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of <h1>Tribunal confirms duty demand for misclassified 'Plastic Satranj' product</h1> <h3>SUPREME INDUSTRIES LTD. Versus COMMISSIONER OF CENTRAL EXCISE, BOMBAY-II</h3> SUPREME INDUSTRIES LTD. Versus COMMISSIONER OF CENTRAL EXCISE, BOMBAY-II - 2004 (170) E.L.T. 432 (Tri. - Del.) Issues: Classification of 'Plastic Satranj' product and confirmation of duty demand.Classification of 'Plastic Satranj' Product:The appellants manufactured 'Plastic Satranj' and initially classified it under Charter sub-heading 3922.90 of the CETA, claiming duty exemption under Notification No. 132/86-C.E. Later, they reclassified it under Chapter 39, but only provisionally approved under sub-heading 4601.00 of Chapter 46. The issue was whether the correct classification should be effective from the date of the Board's Circular on 16-6-1987 or earlier. The Tribunal held that the product was always classifiable under Chapter 46, and the Circular merely clarified the classification. The appellants wrongly claimed duty exemption, leading to a demand for duty payment, which was rightly confirmed.Duty Calculation and Modvat Credit:The appellants argued that duty calculation should consider the Modvat credit on inputs used in production and the cum-duty price principle. The Tribunal agreed that the duty amount calculation by the Department was incorrect. The appellants were entitled to claim Modvat credit and the cum-duty price principle, citing precedents like Bharat Wagon & Engg. case and C.C.E., Delhi v. Maruti Udyog Ltd. case. As these aspects were not considered, the matter was remanded to the adjudicating authority for a fresh decision, with instructions to consider the Modvat claim and cum-duty price, affording the appellants a hearing opportunity.Conclusion:The Tribunal upheld the classification of the 'Plastic Satranj' product under Chapter 46 but remanded the case for a reevaluation of the duty amount payable by the appellants. The decision emphasized the need to consider Modvat credit and the cum-duty price principle in the duty calculation process.
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