TaxTMI 
TaxTMI 
2010 (3) TMI 548
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....f Section 11A of Central Excise Act, 1944 (as detailed in annexure-B to show cause notice); (b) Central Excise duty amounting to Rs. 2,29,293/- on Tablet box and lids (Plastic containers with lids) falling under CSH No. 3923.90 of CETA, 1985 manufactured and removed clandestinely by M/s. Mahavir Plastics should not be demanded and recovered from them under proviso to sub-section (1) of section 11A of Central Excise Act, 1944 (as detailed in Annexure-C to show cause notice); (c) Central Excise duty amounting to Rs. 44,138/- on snap Button (fasteners) of plastics falling under CSH No. 3926.90 of CETA, 1985 manufactured and removed clandestinely by M/s. Mahavir Plastics should not be demanded and recovered from them under proviso to sub-section (1) of Section 11A of Central Excise Act, 1944 (as detailed in Annexure-D to show cause notice). (d) Central Excise duty amounting to Rs. 75,974/- on mosquito lamps - repellant appeared to be classifiable under chapter sub-heading No. 8548.00 CETA, 1985 manufactured and removed clandestinely by M/s. Mahavir Plastics should not be demanded and recovered from them under proviso to sub-section (1) of Section 11A of Central Excise Acts, 1944 (as....
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....have examined the records and heard both sides. In the written submissions filed on behalf of the appellants, we come across the following break-up of the demand of duty raised on M/s. Mahavir Plastics, for the period 1-4-98 to 24-1-2000. S. No Item Amount of duty demanded (a) Top and bottom holders of cloth clip alleged to be complete cloth clip classifiable under sub-­heading No. 3924.90 Rs. 17,13,341/- (b) Caps, nozzles, containers, lids and accessories of plastics classifiable under sub-heading 3923.90 Rs. 2,29,293/- (c) Snap fasteners classifiable under sub-heading 3926.90 Rs. 44,138/- (d) Mosquito repellant classifiable under sub-heading No. 8548.50 Rs. 75,974/- (e) Modvat credit denied on inputs cleared as such without reversal of credit Rs. 89,301/- 4. In respect of the goods mentioned at 'a' & 'b' above, the case of the assessee is that they were not liable to pay duty on these goods on account of the exemption available to them under Notifications No. 5/98-C.E. dated 2-6-98 (Sl. No. 69) and 5/99-C.E. dated 28-2-99 (Sl. No. 70). It is claimed that the relevant condition (Condition No. 10) was satisfied by the assessee for the benefit of e....
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....he Tribunal's first decision in N.M. Nagpal's case was set aside by the Hon'ble Supreme Court, which remanded the matter to the Tribunal vide order dated 3-5-2006 in Civil Appeal No. 1571/01, [2008 (222) E.L.T. 486 (S.C.)] [CCE, Delhi v. N.M. Nagpal (P) Ltd.]. It is pointed out, fairly enough, that the Remanded case was decided by this Tribunal in favour of the Revenue. In this connection, ld. Counsel has produced a copy of final order Nos. 732-733/2006-EX dated 9-8-2006 in appeal Nos. E/228/00-B and E/1343/01-C. The Tribunal, in the said final order, had a fresh look at condition No. 10 ibid and it was held to the effect that the scope of the condition should be ascertained and understood with reference to the two MODVAT Rules (Rules 57A and 57B) referred to in the text of the condition. Accordingly, it was held that a manufacturer claiming exemption from payment of duty on his final product under Sl. No. 69 of the table annexed to notification No. 5/98-C.E. should not have availed MODVAT Credit under Rule 57A or 57B on the inputs used in or in relation to the manufacture of such final product or in the manufacture of any other final product manufactured in the same factory. In th....
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.... payment of duty by the assessee during the period of dispute, was classified by the ld. Commissioner under sub-heading 3926.90 of the CET Schedule. M/s. Mahavir Plastics claimed classification of the item under SH 9606.10 on the ground that the said item was specifically covered by SH 9606.10 of the tariff schedule. On a perusal of the relevant tariff entries, we find that buttons, snap fasteners, etc. were specifically covered by heading 96.06 and that buttons and button blanks were specifically classified under SH 9606.10 of the tariff schedule as it stood during the material period. The ld. Counsel has also invited our attention to the relevant HSN heading 96.06. Explanatory Notes under this heading indicates that the heading covers buttons, studs and similar articles used for fastening or decorating articles of apparel, household linen, etc. This note further gives a list of principal materials used for making buttons, studs, etc., and these include plastics. On the other hand, the rival heading 39.26 broadly covers the articles of plastics. It is settled law that a specific entry will always prevail over the general. Yet another tenet of rule of classification of excisable go....
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....Madras - 1994 (74) E.L.T. 9 (S.C.). In both the cited cases, it was held to the fact that, where the relevant facts were known to both the parties, the omission by one to do what he might have done and not that he must have done does not render it suppression of facts for the purpose of Section 11A(1) of the Central Excise Act. On the other hand, it is argued by the ld. SDR that the relevant facts were not at all disclosed to the department during the material period and that such facts were covered only through subsequent investigations. The assessee admittedly did not maintain statutory records covering manufacture and clearance of dutiable goods during the material period. No RG-1 register was maintained, nor was any statutory invoice under Rule 57A of the Central Excise Rules, 1944 issued at the time of clearance of the goods. All the transactions were entered only in private records. Clearances were made under bills or challans, some of which were not even in the name of the assessee. The Ld SDR has also pointed out that Shri Upendra Shantilal Kapadia has admitted these facts consistently in all his statements recorded under Section 14 of the Central Excise Act, and none....
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.... That letter read thus :- "We have not manufactured any clips in the current year". 13. The ld. Counsel has made an endeavour to explain this submission of the party by pointing out that the assessee meant to say that they had not manufactured any clips as such in the year 1998-99. We wish, M/s. Mahavir Plastics could have given this explanation in their letter itself. Thus, by and large, the Revenue has been able to make out a case of suppression of facts against the assessee. Accordingly, it is held that no part of the demand of duty is time-barred. 14. The ld. Counsel has also submitted that, in a case of this nature, there can be no penalty on the assessee. In this connection also, he has relied on Final Order Nos. 732-733/06 dated 9-8-2006. It is submitted that the issues involved in this case are in the nature of legal issues and, therefore, a penalty under Section 11AC of the Central Excise Act on the assessee should be avoided. The ld. SDR has vehemently opposed this plea. We have already found that the assessee by their conduct attracted the provisions of the proviso to Section 11A(1) of the Act. As the basis of penalty under Section 11AC is no different from the basis ....
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....ses are concerned. As regards Shri Upendra Shantilal Kapadia, the ld. Counsel has been able to challenge the penalty imposed on him, successfully on the strength of case law. He has cited CC (EP) v. Jupiter Exports - 2007 (213) E.L.T. 641 (Bom.), wherein it was held by the Hon'ble High Court that, where a partnership firm was penalized under Section 112 of the Customs Act, 1962, separate penalties could not be imposed on its partners. Shri Upendra Shantilal Kapadia was a partner of M/s. Mahavir Plastics. We have already held that M/s. Mahavir Plastics are liable to be penalized under Section 11AC. Therefore the separate penalty imposed on the partner under Rule 209A would not be sustainable. 16. In the result, we dispose of these appeals : (a) By holding that M/s. Mahavir Plastics are liable to' pay duty of Rs. 17,13,341/- as well as duty of Rs. 2,29,293/-; (b) By holding that they are not liable to pay duty on the snap fasteners, which were chargeable to 'nil' rate of duty under SH 9606.10 of the tariff schedule during the period of dispute; (c) B....