2014 (3) TMI 663 - AT - Central Excise

Tribunal Upholds Duty Demand on Newsprint Classification

NEPA LTD. Versus COMMISSIONER OF CENTRAL EXCISE, INDORE

The Tribunal upheld the duty demand against the appellants for the classification of newsprint under the Central Excise Tariff Act, 1985. Despite the ... Benefit of Notification No. 60/88-C.E., dated 1-3-1988 - Manufacture of Newsprint - Classification of goods under sub-heading No. 4801.90 or under heading No. 48.02 - Held that:- as per the Central Excise Tariff Heading No. 48.01 covers new print in rolls of sheets and as per the Chapter Note 3 of Chapter 48 of the Tariff “News prints” means paper intended for printing of a newspaper. In the present case, as the paper in question, was cleared to such organisations, which are not printer of newspaper hence the paper was not intended for printing of a newspaper - Following decision of assessee's own case in [2008 (4) TMI 620 - CESTAT, NEW DELHI] - Decided against assessee. Issues: Classification of newsprint under Central Excise Tariff Act, 1985; Entitlement to Notification No. 60/88-C.E. benefit; Validity of duty demand and penalty imposition; Rejection of application for recalling Tribunal's final order; High Power Committee's direction to re-adjudicate the matter; Finality of Tribunal's decision and subsequent appeal to High Court.Classification of Newsprint: The appellants were engaged in manufacturing newsprint falling under Heading 48.01 of the Central Excise Tariff Act, 1985. The dispute arose regarding the classification of newsprint supplied to customers other than newsprint establishments under sub-heading No. 4801.90. The department contended that the goods should be classified under heading No. 48.02 attracting a higher duty rate. Seven show cause notices were issued demanding duty payment of Rs. 2,63,536, which was confirmed by the Adjudicating authority along with a penalty of Rs. 5,000.Benefit of Notification No. 60/88-C.E.: The department argued that the appellants were not entitled to the benefit of Notification No. 60/88-C.E., dated 1-3-1988. The Commissioner (Appeals) initially set aside the duty demand and penalty, but the CESTAT later reversed this decision and restored the original order-in-original. The Tribunal dismissed an application for recalling its final order, stating that the paper in question was not intended for printing newspapers as per the Central Excise Tariff.Re-adjudication and High Power Committee's Direction: Following the Tribunal's decision, the High Power Committee directed the department to re-adjudicate the matter. The adjudicating authority confirmed the duty demand against the appellants, which was upheld by the Commissioner (Appeals). The Tribunal noted that the issue had been settled at its level, and the COD's direction to re-adjudicate was unnecessary. The Tribunal found no reason to interfere with the lower authorities' decisions.Finality of Tribunal's Decision and Appeal to High Court: The Tribunal emphasized that once an issue is settled by the Tribunal, subsequent directions to re-adjudicate may not be warranted. The Tribunal highlighted that the issue had attained finality at its level, and any appeal should have been made to the High Court. Despite the appellant's appeal to the High Court and the rejection by the High Power Committee, the Tribunal rejected the appeal and disposed of the stay petition, affirming the lower authorities' decisions.This detailed analysis of the judgment provides a comprehensive overview of the issues involved, the legal arguments presented, and the Tribunal's reasoning in reaching its decision.