2001(03)LCX0169
IN THE CEGAT, WEST ZONAL BENCH, MUMBAI
S/Shri J.H. Joglekar, Member (T) and G.N. Srinivasan, Member (J)
DIPESH ENGG. WORKS
Versus
COMMISSIONER OF C. EX. & CUS., MUMBAI-III
Order Nos. 695-98/2001-WZB/C-II, dated 13-3-2001 in Appeal Nos. E/916-R/95-Mum & E/1151-1153-R/96-Mum
Advocated By : None, for the Appellant.
Smt. R. Arya, SDR, for the Respondent.
[Order per : J.H. Joglekar, Member (T)]. - These four appeals have common grounds and arise from the same order. They are therefore being disposed of vide this single order.
2. In spite of repeated instructions and cautions, the appellants have not appeared before us. We are therefore taking up these appeals for disposal ex parte on merits. We have heard Smt. R. Arya for the Revenue.
3. The appellants filed classification list Nos. 1/91-92, 2/91-92, 3/91-92 and 1/92-93 from time to time. One kind of goods manufactured by them was described as “wooden plates and frames for filtration in filter plates”. These goods were described as articles of wood and claimed to classify under sub-heading 4410.90. These classification lists were approved by the jurisdictional Assistant Collector. In September, 1993, the jurisdictional Collector of Central Excise passed orders in terms of Section 35E(4) of the Central Excises and Salt Act, 1944 (as it then was) directing the Assistant Collector to file an application before the jurisdictional Collector of Central Excise (Appeals) to determine the legality and propriety of these approvals. In this order the Collector after referring to the various tariff entries, opined that the appropriate classification for these products was under Heading 8421. The assessees filed cross-objections and also appeared before the Collector (Appeals). Before the Collector (Appeals), the following submissions were made as recorded by the learned Commissioner (Appeals) :-
“At the hearing of the application and in the cross-objections, the respondents have submitted that the item “wooden plates and frames for filtration in filter press” have been classified under 4410.90 not merely in the disputed period of 91-92 and 92-93 but also in the earlier years. That the plates and frames are for filtration press had been declared explicitly in all the classification lists which have been bought to be reviewed. The said classification lists have been approved by the Assistant Collector and therefore any change in the classification of the product due to re-thinking on the part of the Central Excise Department can only be effective prospectively. They, however, added that they have no objection to the revision of the classification on the lines sought by the Assistant Collector if the same takes effect from the date of the order of the Collector (Appeals) and provided no differential duty for the past periods 91-92 and 92-93 for which show cause-cum-demand notices have already been issued by the Superintendent, are payable by the respondents.”
The Commissioner (Appeals) allowed the application made by the jurisdictional Commissioner and directed classification under 8421.00. In her discussions, however, she used the following language :-
“In the instant case, though the respondents were manufacturing and selling a composite machinery item to their buyers, they were classifying its various component parts separately, viz. wooden plates and frames for filter press, nutch filter, M.S. casting frame, filter press, etc. with a view to claiming exemption for the wooden plates and frames as an independent product. They have, thus, wilfully mis-stated the classification of the product in the classification lists. Under these circumstances, the Department would be well within its right in invoking the extended period under Section 11A in the matter of raising demand. However, the issue before me in the present application is the question of classification and not of demand relating to the past clearances of the disputed product. I, therefore, do not propose to go into the aspect of legality of demand, raised by the respondents in their counter objections.”
4. In their appeal, the assessees have taken very strong objection to these phrases used by the Commissioner. It has been claimed at all times in unambiguous terms that the entire description was given when claiming classification under Chapter 44. It is claimed that even prior to the filing of the classification lists in dispute today, this very classification claimed was without any basis accepted by the Assistant Collectors. It was claimed that they had never cleared any filter press from the factory. It was claimed that the Collector was using this language only to cover the lapses of the Departmental officers. The prayer made is that the observations of the Collector should be struck off from the said order.
5. There is no show cause notice in these proceedings. The order of the Collector under Section 35E(4) does not speak of any suppression or misdeclaration. The proceedings as are before us do not involve any recovery of duty. Therefore the learned Commissioner made a patent error in using the phrases in paragraph 6 as reproduced by us above. We find that the appellants are quite right in seeking deletion of these phrases. We accordingly direct that from the Commissioner's order, the following sentences from paragraph 6 shall be deleted and shall be held to be deleted at all times :-
“In the instant case, though the respondents were manufacturing and selling a composite machinery item to their buyers, they were classifying its various component parts separately, viz. wooden plates and frames for filter press, nutch filter, M.S. casting frame, filter press, etc. with a view to claiming exemption for the wooden plates and frames as an independent product. They have, thus, wilfully mis-stated the classification of the product in the classification lists. Under these circumstances, the Department would be well within its right in invoking the extended period under Section 11A in the matter of raising demand.”
6. The appeals are allowed in these terms.
Equivalent 2001 (132) ELT 0210 (Tri. - Mumbai)