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TMI Blog2016 (5) TMI 1241X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned Order-in-Appeal, the appellant M/s. Zenith Spares (herein-after referred to as appellant No.1) was engaged in the manufacture of engineering goods under Chapter heading 84.31 of the first schedule to the Central Excise Tariff Act, 1985 (5 of 1986). It was a unit owned by M/s. Waidhan Engineering and Industries Pvt. Ltd. (herein-after referred to as appellant No.2) and had availed benefit of Notification No.8/2003-CE, dated 01.03.2003. The appellant No.2 was having one more unit, which was functioning in the name and style of M/s. Waidhan Engineering and Industries Pvt. Ltd., Unit II and manufacturing Tread Rubber falling under Chapter No.40 of Central Excise Tariff Act, 1985. The turnover of both the appellants was clubbed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 upto 28.02.2005 attracting nil rate of duty and therefore the value of clearance was not includible for the purpose of computing the exemption limit under Notification No.8/2003-CE. As per Note 9 of Chapter No.40, sub-heading 4008.21 was also applied to plates, sheets and strips, whether or not cut to shape and surface worked or further worked so as to render them fit for resoling or repairing or retreading of rubber tyres. As per clause 3(a) of Notification No.8/2003-CE, dated 01.03.2003 for the purpose of determining the first clearances, clearances which are exempted from whole of duty were not to be counted. (iv) Demand is time barred as the appellant was under reasonable and bona fide belief that their product was classified under su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ips, for resoling or repairing or retreading rubber tyres" and chargeable to duty. The appellant has claimed the classification of the tread rubber under sub heading 4008.21 which reads "plates, blocks, sheets and strip used in the manufacture of sole heels or soles and heels combined for foot wear, chargeable to duty at "Nil" rate. As per the heading and sub heading notes, the tread rubber, by no stretch of imagination can be classified under sub heading 4008.21 which obviously covers vulcanized non-cellular rubber used for foot wear. The classification of Tread Rubber in terms of heading and sub heading note is very clear and the only discordant note is the last para of note 9 of Chapter 40, which reads as follows:- "Sub-heading No.400 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aken into account for calculating the exemption and eligibility limit under notfn No.8/03 dated 1/3/03 and other similar Central Excise notifn. applicable to the period involved, for both the appellant as well as Unit-II." A careful reading of the above-quoted paras of the impugned order clearly shows that as per Note 9 of Chapter 40, which Commissioner (Appeals) called discordant, it is stated that CTH 4008.21 shall apply to plates, sheets and strips whether or not cut to shape and surface-worked or further worked so as to render them fit for re-soling, repairing or retreading of rubber tyres. The Commissioner (Appeals) in para 13 quoted above traced the history of classification of tread rubber and observed that the above referred note 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts, otherwise there would be no situation for which ordinary limitation period would apply. Inadvertent non-payment is to be met within the normal limitation period and the burden is on Revenue to prove allegations of wilful mis-statement. The onus is not on the assessee to prove its bona fides. Un the case of Chemphar Drugs Liniments [2002-TIOL-266-SC-CX], the Supreme Court held that some positive other than mere inaction or failure on the part of the assessee or conscious or deliberate withholding of information when assessee knew otherwise, is required before it is saddled with the liability the extended period. In the case of Continental Foundation Joint Venture [2007 (216) ELT 177 (SC)], Supreme Court went to the extent of ruling that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of its jurisdiction. Para 22 of the said judgement is reproduced below:- "22. The Tribunal came to the conclusion that the demand by the Revenue was beyond the period of limitation of one year prescribed under Section 73(1) of the Finance Act, 1994 and that the period of five years could not have been invoked. That part of the judgment of the Tribunal has been confirmed in the companion appeal. Once that be the position and the Tribunal having came to the conclusion that the extended period of limitation could not have been validly applied, the Tribunal, in our view, acted outside its jurisdiction in entering upon the merits of the dispute on whether the demand for duty should be confirmed. Once it is held that the demand is time barred, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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