Classification of Cutting Dies & Discs under Central Excise Tariff, Appeal Dismissed, Penalties Upheld

COLLECTOR OF CENTRAL EXCISE, CALCUTTA Versus BATA (INDIA) LTD.

COLLECTOR OF CENTRAL EXCISE, CALCUTTA Versus BATA (INDIA) LTD. - 1987 (32) E.L.T. 89 (Tribunal) Issues:
Classification of cutting dies and cutting discs under Item 68 CET or Item 51A(iv) CET; Barred by limitation review notice by Central Government; Jurisdiction of Central Board to decide on classification; Proper classification of goods as industrial knives under Item 51A(iv) CET; Imposition of penalty justified or not.

Analysis:
1. The case involved the classification of cutting dies and cutting discs by M/s. Bata (India) Ltd., with the Collector of Central Excise, Calcutta confirming demands under three show cause notices. The Collector classified the goods under Item 51A(iv) CET, while the Central Board later held that the goods fell under Item 68 CET, setting aside the demands and penalties imposed by the Collector.

2. A preliminary objection was raised regarding the review notice issued by the Central Government being barred by limitation under Section 36(2) of the Central Excises and Salt Act. The objection was partially upheld, stating that the bar of limitation may not apply to the penalty imposed under the Collector's order dated 13-12-1979.

3. The issue of whether the penalty could be imposed depended on the proper classification of the goods. Both parties presented arguments on the classification, with the Department questioning the jurisdiction of the Central Board to decide on classification without an appeal against the Assistant Collector's classification order. However, the Tribunal ruled that only grounds mentioned in the review notice by the Central Government could be considered.

4. The Tribunal focused on the classification issue, determining whether the goods were industrial knives under Item 51A(iv) CET. The Central Board's order lacked detailed reasoning for its conclusions, leading the Tribunal to consider evidence presented by both parties regarding the classification of the goods.

5. The Tribunal examined previous cases and certificates provided by the respondents to establish that the products were known as cutting dies and not industrial knives. Relying on precedent and evidence, the Tribunal concluded that the products did not fall under Item 51A(iv) or 51A(iii) CET, leading to the dismissal of the appeal and discharge of the review notice dated 15-2-1982.

6. In a separate judgment, the Sr. Vice-President concurred with the decision to dismiss the appeal, emphasizing that the grounds for review set out by the Central Government should limit the scope of the Tribunal's consideration. The Revenue was not allowed to introduce new grounds at a later stage, and the appeal was dismissed based on the grounds specified in the review notice.