Fresh excise demand letter invalid where classification dispute was already decided for the assessee and the Revenue had appealed.

Approval of a classification list can make duty paid during the intervening period provisional, so differential duty may arise on final approval. Here, however, the Collector (Appeals) had already set aside the unquantified demand for the same period, and the Revenue had carried the classification dispute in appeal. In those circumstances, the Superintendent of Central Excise was not justified in issuing a fresh demand letter, and invocation of Section 11A of the Central Excise Act, 1944 was held inappropriate. The demand letter was therefore not sustainable, and the assessee succeeded on that issue.

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Issues: Whether the Superintendent of Central Excise could demand duty by letter when the classification dispute had already been decided in favour of the assessee and the Revenue had carried the matter in appeal.

Analysis: The approval of a classification list may render the duty paid during the interregnum provisional, and differential duty can arise consequentially on final approval. However, the demand in the present case was issued by the Superintendent despite the Collector (Appeals) having already set aside the unquantified demand for the same period. The Tribunal held that, once the issue had been determined in favour of the assessee and the Revenue had pursued an appeal, the Superintendent was not justified in issuing a fresh demand letter, and the invocation of Section 11A of the Central Excise Act, 1944 was not appropriate in these circumstances.

Conclusion: The demand letter was not sustainable and the assessee succeeded on this issue.

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