2000(10)LCX0209
IN THE CEGAT, COURT NO. II, NEW DELHI
S/Shri V.K. Agrawal, Member (T) and P.G. Chacko, Member (J)
COMMISSIONER OF CENTRAL EXCISE, MEERUT
Final Order No. 1796/2000-B, dated 11-10-2000 in Appeal No. E/2511/2000-B
CASE CITED
Paper Products Ltd. v. Commissioner — 1999(08)LCX0250 Eq 1999 (112) ELT 0765 (S.C.) — Relied on.. [Paras 3, 4, 5]
Advocated By : Shri M.P. Singh, JDR, for the Appellant.
Shri A.R. Madhav Rao, Advocate, for the Respondents.
[Order per : P.G. Chacko, Member (J)]. - The respondents manufactured and cleared STD/PCO monitor and parts/accessories thereof during November, 1998 to February, 1999 on payment of duty @ 13% as applicable to Chapter Headings 90.30/90.33 of the Central Excise Tariff. The Department wanted to classify the products under Tariff entries 84.70/8473.90 attracting duty @ 18% and proposed to recover the differential duty from the respondents under Section 11A of the Central Excise Act as per show cause notice (SCN) dated 17-5-1999. The adjudicating authority confirmed such demand of duty to the extent of Rs. 6,60,260.00. The appeal filed by the respondents against the order of adjudication was allowed by the Commissioner (Appeals). Hence the present appeal by the Revenue.
2. We have carefully examined the records and have heard ld. JDR Shri M.P. Singh for the appellants and ld. Advocate Shri A.R. Madhav Rao for the respondents.
3. We note that the demand of duty as confirmed by the Assistant Commissioner was for a period prior to C.B.E.C.’s circular dated 5-4-1999 which laid down that STD/PCO monitors were appropriately classifiable under Tariff Heading 84.70. The lower Appellate authority set aside the demand of duty following the ruling of the Supreme Court in Paper Products Ltd. v. CCE [1999(08)LCX0250 Eq 1999 (112) ELT 0765 (S.C.)]. The Apex Court’s ruling was that the Board’s circular in force at the relevant point of time and not any later circular (changing the stand on classification) would govern classification of any goods for the relevant time. On a perusal of the aforesaid circular dated 5-4-1999 which contains reference to earlier circular dated 24-1-1994, we observe that the classification of STD/PCO monitor as per the earlier circular was under Tariff Heading 90.20 and that the Board changed their stand and laid down the classification of the said goods under Tariff Heading 84.70 as per the later circular dated 5-4-1999. It was the earlier circular dated 24-1-1994 which remained in force during the period of dispute in the present case and, accordingly, the goods in question stood classified in Chapter 90 during such period. The Commissioner (Appeals) took note of this position and, by the impugned order, held that any further duty could not be demanded for the said period.
4. The only ground raised by the Revenue in the appeal is that, by virtue of the provisions of Section 110 of the Finance Act, 2000, the demand of duty raised in the SCN dated 17-5-1999 for the period prior to the circular dated 5-4-1999 is enforceable against the respondents since the period covered by the demand falls within the period (17-11-1980 to 12-5-2000) mentioned in Section 110, ibid. Ld. DR has, therefore, prayed for setting aside the impugned order. Ld. Advocate has, on the other hand, submitted that the real issue is whether the Board's earlier circular was binding or not on the Department for the period of dispute. On this issue, he has relied on the Supreme Court’s ruling in the case of Paper Products Ltd. (Supra) and has urged for holding that the said circular governed classification of the product for the period of dispute and there was no short levy of duty for such period as the goods stood classified under Chapter 90 of the Tariff during the period.
5. We have carefully examined the rival submissions. It is now settled law that a circular of the Board is binding on the Departmental authorities. The earlier circular dated 24-1-1994 which held the classification of the products under Chapter 90 of the Tariff remained in force till it was superseded by the circular dated 5-4-1999. The impugned demand is for a period between 24-1-1994 and 5-4-1999, for which the party had paid duty at the appropriate rate. There being no question of short-levy, the demand has been rightly vacated by the lower appellate authority following the Apex Court’s ruling in Paper Products Ltd. (Supra). The ground raised in the appeal memo, with reference to Section 110 ibid, is irrelevant to the issue involved in the case as rightly pointed out by ld. Advocate.
6. In view of the above, we find no merit in the Revenue's appeal and we reject the same.
_______ Equivalent 2001 (127) ELT 149 (Tri. - Del.) Equivalent 2001 (042) RLT 0269