Distinct commercial identity supports separate excise classification; review notice was also held time-barred under the governing limitation period.

Finished industrial gaskets cut out of mineral fibre sheets were treated as a separate excisable commodity with distinct commercial identity, so they were held classifiable under Tariff Item 68 and not under Tariff Item 22-F(4). A review show cause notice issued to reopen an appellate order was also held time-barred because the applicable limitation period under the proviso to Section 36(2), read with Section 11-A, had expired. The classification objection and the limitation challenge were both resolved in favour of the assessee.

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Issues: (i) Whether industrial gaskets cut out of mineral fibre sheets were classifiable under Tariff Item 68 or under Tariff Item 22-F(4) of the Central Excise Tariff; (ii) Whether the review show cause notice issued under Section 36(2) of the Central Excises and Salt Act was barred by limitation.

Issue (i): Whether industrial gaskets cut out of mineral fibre sheets were classifiable under Tariff Item 68 or under Tariff Item 22-F(4) of the Central Excise Tariff

Analysis: The goods were treated as a separate excisable commodity on the footing that the finished gaskets had a distinct commercial identity. The Tribunal followed its earlier decision on identical facts and applied the same reasoning to hold that the gaskets were properly classifiable under Tariff Item 68. On that basis, the classification made by the Assistant Collector under Tariff Item 22-F(4) was not sustainable.

Conclusion: The classification under Tariff Item 22-F(4) was set aside and the goods were held classifiable under Tariff Item 68, in favour of the assessee.

Issue (ii): Whether the review show cause notice issued under Section 36(2) of the Central Excises and Salt Act was barred by limitation

Analysis: The notice sought to reopen the appellate order dated 11-5-1981, but it was issued on 3-5-1982. The Tribunal held that the relevant period for issuing the review notice was six months as contemplated by the proviso to Section 36(2), read with the limitation period under Section 11-A of the Central Excises and Salt Act. Since the notice was beyond that period, it could not survive at least in relation to the quantified duty demand.

Conclusion: The review notice was held to be barred by limitation, in favour of the assessee.

Final Conclusion: The appeal failed, and the review proceedings were discharged, with the classification issue and the limitation objection both decided against the Department.

Ratio Decidendi: Where a finished product acquires a distinct commercial identity, it may be separately classifiable for excise purposes; a review notice issued beyond the prescribed period under the governing limitation provision is time-barred.

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