Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise, ... vs Mafatlal Dyes & Chemicals Ltd on 9 March, 2010
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT No. I APPEAL No. E/4027/02 (Arising out of Order-in-Appeal No. RJB/M-II/282/2002 dated 30.9.2002 passed by Commissioner of Central Excise (Appeals), Mumbai-II) For approval and signature: Mr. P.G. Chacko, Hon'ble Member (Judicial) Mr. P. Karthikeyan, Hon'ble Member (Technical) ======================================================
1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen of the Order?
4. Whether Order is to be circulated to the Departmental : Yes authorities?
====================================================== Commissioner of Central Excise, Mumbai-III Appellant Vs. Mafatlal Dyes & Chemicals Ltd. Respondent Appearance: Shri N.A. Sayyad, Authorised Representative (JDR), for appellant None for respondent CORAM: Mr. P.G. Chacko, Hon'ble Member (Judicial) Mr. P. Karthikeyan, Hon'ble Member (Technical) Date of Hearing: 9.3.2010 Date of Decision: 9.3.2010 ORDER NO................................. Per: P.G. Chacko, Member (J)
This is an appeal filed by the Revenue, represented today by the learned JDR. There is no representation for the respondent (assessee) despite notice, nor any request of theirs for adjournment.
2. The issue arising for consideration pertains to classification of three products, namely Emdilith, Mahacol and Emditex. The lower appellate authority has classified all these products, for the periods covered by the relevant classification declarations (Nos. 5/2000-01 dated 13.10.2000, 6/2000-01 dated 16.11.2000, 7/2000-01 dated 27.11.2000, 8/2000-01 dated 23.1.2001 and 9/2000-01 dated 19.3.2001) under SH 3905.10 of the CETA Schedule as claimed by the assessee. According to the Revenue, the first two products are classifiable under SH 3506.00 as decided by the original authority. Hence the present appeal.
3. Learned JDR has given us the necessary account of the history of this case, which, we find, is relevant to the aforesaid issue. Way back in 1990, the assessee wanted the above products to be classified under SH 3905.10 as basic grades of polymers of vinyl acetate in packing above 1 kg. Show-cause notices were issued by the department to classify the products under SH 3506.00 as adhesives and recover differential duty on that basis. The original authority, by order-in-original dated 26.2.1991, classified the first two products under SH 3506.00 as adhesives and the third one under SH 3905.10. This decision was subsequently upheld by the Collector of Central Excise (Appeals) vide order-in-appeal No.23/29 dated 13.2.1992, which was not challenged by the assessee. Thus, the classification of the three products stood finalised, in favour of the Revenue in respect of Emdilith and Mahacol and in favour of the assessee in respect of Emditex. The above order-in-appeal was not challenged by the Revenue either. Subsequently, the Assistant Commissioner finalised provisional assessments on the aforesaid basis for the period 1993 to 1995 vide order-in-original No.70 dated 17.1.1997. He also raised consequential demand of duty on the assessee vide order-in-original dated 19.11.1997, whereafter the assessee opted for settlement of the dispute under the Kar Vivad Samadhan Scheme, 1998 and accordingly settled the dispute on payment of 50% of the duty amount based on order-in-original dated 19.11.1997. However, in the meanwhile, the assessee filed an appeal with the Commissioner (Appeals) against order-in-original dated 17.1.1997 but the appellate authority remanded the case for de novo adjudication. Obviously, what was remanded was finalisation of provisional assessments for the period 1993-95. When, pursuant to the remand, the Deputy Commissioner insisted on bank guarantee under Rule 9 of the Central Excise Rules, 1944, the assessee once again approached the appellate authority, which granted relief to the appellant by dispensing with bank guarantee vide order-in-appeal dated 18.8.2001. Meanwhile, the aforesaid classification declarations filed by the assessee came to be considered by the Deputy Commissioner and the three products were classified under SH 3506.00 (Emdilith and Mahacol) and SH 3905.10 (Emditex). It was this decision of the Deputy Commissioner which was set aside by the Commissioner (Appeals) in relation to the classification of Emdilith and Mahacol, against which the Revenue is presently in appeal before us.
4. The learned JDR submits that the classification of the two products (Emdilith and Mahacol) was finalised by the lower appellate authority as early as in 1992 and that the decision of the said authority became final and binding on both sides and, therefore, it was not open to the said authority to reopen the classification of the two products. It is also submitted that the test report of the Deputy Chief Chemist relied on by the lower appellate authority in the impugned order had been considered by the original authority way back in 1991 in the context of classification of the products. Obviously, the test report was also part of the record considered by the lower appellate authority while affirming the classification ordered by the original authority. It is that decision of the Collector (Appeals) (1992) which attained finality for want of challenge. The learned JDR has further pointed out that, in the impugned order, the learned Commissioner (Appeals) overlooked the fact that the assessee had accepted the classification of Emdilith and Mahacol under SH 3506.00 and, on that basis, chosen to settle the dispute with the department under the KVS Scheme.
5. After considering the submissions and examining the other grounds of this appeal, we have found merit. The classification of Emdilith and Mahacol under SH 3506.00 originally decided by the Assistant Collector in 1991 was sustained by the Collector (Appeals) in 1992. Both the authorities duly took into account the report of the Deputy Chief Chemist. The classification was never challenged by the assessee. They, however, chose to settle the dispute, which arose out of demand notices based on the aforesaid classification of Emdilith and Mahacol under SH 3506.00, under the KVS Scheme. There is nothing on record to show that, since the above classification of the two products, there was any change in the method of manufacture of the goods or any change in tariff entries. In the circumstances, the subsequent classification declarations filed by the assessee ought to have been disposed of in the light of the appellate Collector's order of 1992. As rightly pointed out by the appellant, it was not open to the Commissioner (Appeals) to reopen the classification of the two products, which was settled long ago.
6. In the result, the decision of the lower appellate authority in relation to the classification of Emdilith and Mahacol is set aside and this appeal is allowed.
(Pronounced in Court) (P. Karthikeyan) Member (Technical) (P.G. Chacko) Member (Judicial) tvu ??
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