2016 (5) TMI 1241

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....h interest and penalties. 2. As stated in the impugned Order-in-Appeal, the appellant M/s. Zenith Spares (herein-after referred to as appellant No.1) was engaged in the manufacture of engineering goods under Chapter heading 84.31 of the first schedule to the Central Excise Tariff Act, 1985 (5 of 1986). It was a unit owned by M/s. Waidhan Engineering and Industries Pvt. Ltd. (herein-after referred to as appellant No.2) and had availed benefit of Notification No.8/2003-CE, dated 01.03.2003. The appellant No.2 was having one more unit, which was functioning in the name and style of M/s. Waidhan Engineering and Industries Pvt. Ltd., Unit II and manufacturing Tread Rubber falling under Chapter No.40 of Central Excise Tariff Act, 1985. The tu....

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....d by appellant No.2 was classifiable under CTH 4008.21 upto 28.02.2005 attracting nil rate of duty and therefore the value of clearance was not includible for the purpose of computing the exemption limit under Notification No.8/2003-CE. As per Note 9 of Chapter No.40, sub-heading 4008.21 was also applied to plates, sheets and strips, whether or not cut to shape and surface worked or further worked so as to render them fit for resoling or repairing or retreading of rubber tyres. As per clause 3(a) of Notification No.8/2003-CE, dated 01.03.2003 for the purpose of determining the first clearances, clearances which are exempted from whole of duty were not to be counted. (iv) Demand is time barred as the appellant was under reasonable and bona f....

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....008.22 of Central Excise Tariff Act, 1985 as "plates, sheets and strips, for resoling or repairing or retreading rubber tyres" and chargeable to duty. The appellant has claimed the classification of the tread rubber under sub heading 4008.21 which reads "plates, blocks, sheets and strip used in the manufacture of sole heels or soles and heels combined for foot wear, chargeable to duty at "Nil" rate. As per the heading and sub heading notes, the tread rubber, by no stretch of imagination can be classified under sub heading 4008.21 which obviously covers vulcanized non-cellular rubber used for foot wear. The classification of Tread Rubber in terms of heading and sub heading note is very clear and the only discordant note is the last para of ....

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....Being an excisable goods chargeable to duty, the value of clearances of tread rubber are to be taken into account for calculating the exemption and eligibility limit under notfn No.8/03 dated 1/3/03 and other similar Central Excise notifn. applicable to the period involved, for both the appellant as well as Unit-II." A careful reading of the above-quoted paras of the impugned order clearly shows that as per Note 9 of Chapter 40, which Commissioner (Appeals) called discordant, it is stated that CTH 4008.21 shall apply to plates, sheets and strips whether or not cut to shape and surface-worked or further worked so as to render them fit for re-soling, repairing or retreading of rubber tyres. The Commissioner (Appeals) in para 13 quoted abov....

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....e non-payment of duties is not equivalent to collusion or wilful mis-statement or suppression of facts, otherwise there would be no situation for which ordinary limitation period would apply. Inadvertent non-payment is to be met within the normal limitation period and the burden is on Revenue to prove allegations of wilful mis-statement. The onus is not on the assessee to prove its bona fides. Un the case of Chemphar Drugs Liniments [2002-TIOL-266-SC-CX], the Supreme Court held that some positive other than mere inaction or failure on the part of the assessee or conscious or deliberate withholding of information when assessee knew otherwise, is required before it is saddled with the liability the extended period. In the case of Continental ....