1999 (2) TMI 145 - AT - Central Excise

Tribunal remands case for assessment of specific serial number in Central Excise Tariff Act

The Tribunal allowed the Revenue's appeal and remanded the case for further examination to determine the specific serial number of Notification No. 14/92 ... Classification Issues:Classification of HDPE bags and sacks under Central Excise Tariff Act - Applicability of Notification No. 14/92 - Duty payment dispute - Requirement of Show Cause Notice.Analysis:The appeal was filed by the Revenue against the order-in-appeal dated 26-12-1994 passed by the Collector (A), Ahmedabad. The Respondent manufactured bags and sacks of HDPE tapes and claimed classification under Chapter 39 of the Central Excise Tariff Act. A Show Cause Notice was issued for demanding duty short paid during a specific period. The Asstt. Collector agreed with the classification under sub-heading 3923.90 but held that duty was payable as per Notification No. 14/92. On appeal, the Collector (A) found the demand not legally sustainable as no new Show Cause Notice was issued after agreeing on the classification under Chapter 39. The Revenue argued that no new notice was needed if the classification was agreed upon, and the applicability of any notification had to be determined without a fresh notice.The Respondents did not appear but submitted that the demand for differential amount considering HDPE sacks under Chapter 63 was not legal. They referred to a clarification by the Central Board of Excise and Customs that HDPE fabrics and bags are classifiable under Chapter 39. The Tribunal reviewed the submissions and noted that the Asstt. Collector had classified the product under Chapter 39 before considering the notification. It was observed that a new Show Cause Notice was unnecessary after agreeing on classification, and the notification specified different rates of duty for goods falling under specific headings within Chapter 39.The Tribunal found that the Collector (A) had not examined the applicability of the specific serial number of Notification No. 14/92 to the impugned product. Therefore, the matter was remanded for further examination to determine which serial number of the notification would apply to the respondent's goods. The Tribunal allowed the appeal filed by the Revenue by way of remand to resolve the issue of notification applicability after providing an opportunity for a personal hearing to both parties.