2018 (10) TMI 1985 - AT - Central Excise

Tax Tribunal Upholds Limitation Defense for Furniture Classification Dispute

The Tribunal held that the demand raised against the appellant for the period April 1993 to October 1994, challenging the classification of furniture as ... Invocation of extended period of limitation - whether furniture cannot be considered as handicraft so as to avail exemption Notification 76/06? - HELD THAT:- The issue on limitation was considered by the Tribunal in the assessee’s own case for different period in the case of [2019 (4) TMI 1460 - CESTAT KOLKATA]. By taking note of the fact that the Commissioner of Central excise Kolkata vide his different order for different period has dropped the demand falling outside the normal period of limitation and such order of the Commissioner stands accepted by the Revenue, the Tribunal also granted relief on the limitation aspect in their case reported as Interscape. Inasmuch as the appellants have already been held to be entertaining a bonafide belief in their other matters involving different period, we are not inclined to take a different view in the present case Accordingly, by holding the demand as barred by limitation - appeal allowed. Issues:1. Denovo proceedings by Commissioner after remand by Tribunal2. Classification of furniture as handicraft for duty exemption3. Demand raised beyond normal period of limitation4. Applicability of Supreme Court decision in Louis Shoppe case5. Tribunal's consideration of limitation in similar cases6. Bonafide belief of the appellant in different mattersAnalysis:1. The judgment involves denovo proceedings conducted by the Commissioner following a remand by the Tribunal. The dispute centered around the classification of furniture manufactured by the appellant, with the appellant claiming exemption by treating it as handicraft.2. The demand was raised against the appellant for the period April 1993 to October 1994, challenging the classification of furniture as handicraft for availing exemption under Notification 76/06. The Commissioner upheld the demand based on the Supreme Court decision in Louis Shoppe vs. CCE 1996 (83) ELT 13, which deemed furniture not eligible for handicraft status.3. The appellant argued that the demand, raised beyond the normal period of limitation, was barred. Citing the Louis Shoppe case, the appellant contended that the Tribunal's consistent view since 1989 considered all furniture as handicraft, and cases pre-dating the Supreme Court decision should not be reopened based on allegations of suppression and malafide.4. The Tribunal considered the issue of limitation in the appellant's case for a different period and noted that the Commissioner of Central Excise Kolkata had dropped demands falling outside the normal limitation period in a separate order. Relying on this precedent, the Tribunal granted relief on the limitation aspect, as seen in the Interscape case.5. Given the appellant's bonafide belief in other matters involving different periods, where relief was granted based on limitation, the Tribunal maintained a consistent approach. Consequently, the Tribunal held the demand as barred by limitation, setting aside the impugned order and allowing the appeal with consequential relief.This detailed analysis of the judgment highlights the key issues addressed by the Tribunal, including the classification of furniture, the application of the Louis Shoppe case, and the significance of limitation periods in tax disputes.