Final classification barred reassessment of product heading, so the excise duty demand, interest and penalty failed.

Finality of product classification barred the revenue from reopening the issue in demand proceedings. The product had already been held to be pig fat under sub-heading 0201.00 in separate proceedings, and that order was not appealed against. Because that classification had attained finality, the authorities could not proceed on the contrary assumption that it fell under sub-heading 1501.00. The excise duty demand, along with interest and penalty, therefore lacked a valid foundation and could not be sustained.

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Issues: Whether the excise duty demand, interest and penalty could be sustained when the classification of the product as pig fat under sub-heading 0201.00 had already attained finality and excluded the product from Chapter 15.

Analysis: The product classification had been decided in separate proceedings, and the order holding it to be pig fat under sub-heading 0201.00 had not been appealed against. That determination therefore became final. Once the classification issue had attained finality, the revenue authorities could not reopen it indirectly in the demand proceedings or proceed on the contrary assumption that the product fell under sub-heading 1501.00. Since the demand itself was founded on the now impermissible classification, the basis for excise duty, interest and penalty disappeared.

Conclusion: The demand, interest and penalty could not be sustained and the assessee succeeded on the classification-linked liability issue.

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