2000 (6) TMI 231 - AT - Central Excise

Supreme Court clarifies duty exemption for video projector; extended limitation period upheld

The Supreme Court ruled in favor of the appellant regarding the classification of a video projector for central excise duty exemption under Notification ... Demand - Limitation - Misdeclaration - Valuation Issues:1. Classification of video projector for central excise duty exemption.2. Invocation of extended period of limitation for show cause notices.3. Misdeclaration of goods and duty liability recalculations.4. Valuation of goods for duty calculation.5. Benefit of recalculation of duty liability based on cum-duty prices.Classification Issue:The appeal concerns the classification of a video projector for central excise duty exemption under Notification No. 160/86-C.E. The Supreme Court previously ruled that the video projector manufactured by the appellant was distinct from Broadcast Television Receiver Sets and qualified for exemption under the said notification.Limitation Issue:The appellant argued against the invocation of the extended period of limitation for the second show cause notice issued for wilful misdeclaration to evade duty payment. The Tribunal upheld the extended limitation period due to misdescription of the product in the classification list, justifying the issuance of show cause notices.Misdeclaration and Duty Recalculation:The appellant's misdeclaration of the product led to the issuance of show cause notices. The duty liability was recalculated after admitting the misdeclaration, and the Tribunal found no fault in the adjudicating authority's valuation based on invoices and allowed discounts.Valuation Issue:The valuation of goods was based on invoices with discounts considered, resulting in confirmed duty demands. The Tribunal found the adjudicating authority's approach to valuation appropriate and upheld the duty demands.Recalculation Based on Cum-Duty Prices:Regarding the benefit of recalculating duty liability based on cum-duty prices, the Tribunal directed a re-examination by the adjudicating authority in line with the Larger Bench decision in Srichakra Tyres Ltd. v CCE, Madras. The Tribunal instructed a review for possible relief based on the facts and law.In conclusion, the appeal was rejected except for the directive to re-examine the duty liability recalculation issue. The Tribunal maintained the classification decision, upheld the extended limitation period, confirmed the valuation approach, and directed a reassessment for recalculating duty liability based on cum-duty prices as per the Larger Bench decision.