Classification and exemption burden remains on Revenue where no contrary evidence is shown after long lapse of time.

Goods were found classifiable under Tariff Item 15AA rather than Tariff Item 15AA(1) because the products were identical to those earlier held under 15AA, and the Revenue did not show any change in the manufacturing process to justify a different view. The exemption under Notification No. 101/66 was also upheld because the assessee had claimed it in the classification list and the Revenue failed to prove that the preparation contained more than five per cent of principal active ingredients. The passage of time made precise verification difficult, but that alone was insufficient to deny the exemption without contrary evidence.

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Issues: (i) whether the goods manufactured by the assessee were classifiable under Tariff Item 15AA as claimed by the assessee or under Tariff Item 15AA(1) as contended by the Revenue; (ii) whether the benefit of Notification No. 101/66 dated 17-6-1966, granting exemption to surface active preparation containing less than five per cent of principal active ingredients, was admissible.

Issue (i): whether the goods manufactured by the assessee were classifiable under Tariff Item 15AA as claimed by the assessee or under Tariff Item 15AA(1) as contended by the Revenue.

Analysis: The dispute related to identical products for an earlier period that had already been held classifiable under Tariff Item 15AA. The Revenue did not demonstrate that the manufacturing process for the relevant period was different from the process earlier examined. Since the Revenue sought a different classification, the burden lay on it to establish facts justifying departure from the earlier view, which it failed to do.

Conclusion: The classification under Tariff Item 15AA was upheld, against the Revenue.

Issue (ii): whether the benefit of Notification No. 101/66 dated 17-6-1966, granting exemption to surface active preparation containing less than five per cent of principal active ingredients, was admissible.

Analysis: The matter related to an old period and the adjudication took place much later, making it impracticable to verify the exact percentage of principal active ingredients after a long lapse of time. The assessee had claimed the exemption in its classification list, and the Revenue did not establish that the preparation contained more than five per cent of principal active ingredients. The burden to disprove the claimed exemption was not discharged.

Conclusion: The benefit of Notification No. 101/66 was rightly extended, against the Revenue.

Final Conclusion: Both the classification dispute and the exemption dispute were resolved in favour of the assessee, and the Revenue's challenge failed in full.

Ratio Decidendi: Where the Revenue seeks a different classification or exemption denial, it must establish the factual basis for its challenge, and an exemption claim may not be rejected merely because verification becomes impossible after a long lapse of time absent contrary proof.

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