TaxTMI 
TaxTMI 
2023 (4) TMI 654
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..... Compounds of PBT under Chapter Sub Heading No. 39079190 of the schedule to Central Excise Tariff Act, 1985. ii.) I also order to classify the excisable goods viz. Compound of Polyamide, under Chapter Sub Heading No. 39081090 of the schedule to Central Excise Tariff Act, 1985. iii.) I confirmed and order to recover the differential Central Excise duty amounting to Rs.2,88,58,033/- (Rupees Two Crore eighty eight lakhs fifty eight thousand and thirty three, including Education Cess and Sec. & High. Ed. Cess), as detailed in annexure "A-1, A-2 and A-3" to the Show Cause Notice, from M/s. Axel Polymers Limited, S.No. 309, Village- Mokshi, Sankarda SAvli Road, Tal-Savli, Dist.-Vadodara under proviso to Section 11A(1) of the Ce....
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.... product since both the product are not pure and the same are compounded with other material therefore, the goods does not fall under the description i.e. polyester chips or nylon chips. The contention of the adjudicating authority is that the term 'Polyester Chips'and 'Nylon Chips'are in respect of pure material and not compounded with other material. The demand was also confirmed invoking the extended period of limitation. 02. Shri Anand Nainawati, learned counsel appearing on behalf of the appellant submits that the exemption from payment of excise duty under the notification supra is provided in respect of Polyester Chips and Nylon Chips. It is his submission that admittedly both the products having active ingredient i.e. in Polyeste....
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....dated 29.12.2006 . 2.1 He submits that the issue is of pure question of interpretation of relevant entries of notification therefore, there is absolutely no suppression of fact on the part of the appellant accordingly, the demand for extended period is not sustainable. He placed reliance on the following judgments:- • UNION OF INDIA V/s. INTER CONTINENTAL (India)- 2008 (226) ELT 16 (S.C.) • INTER-CONTINENTAL (INDIA) V/s. UNION OF INDIA- 2003 (154) ELT 37 (Guj.) • TATA TELESERVICES LTD V/s. CC- 2006 (194) ELT 11 (S.C.) • GUJARAT POLYCRETE PRIVATE LTD. V/s. CCE, AHMEDABAD 1999 (114) ELT 843 (Tribunal) • Continental Foundation JT Venture Vs CCE Chandigarh- 2007 (216) ELT 177 (....
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....ling under chapter heading no. 3907 and nylon chips falling under heading no. 3908. It is to be noted that for the purpose of exemption eight digit subject heading has not been prescribed under the notification therefore, it is clear that all the polyester chips falling under 3907 is eligible for exemption similarly, all the nylon chips falling under 3908 is eligible for exemption. The adjudicating authority has denied the exemption relying on the clarification given by the Chemical examiner and chemical examination report which is reproduced below:- "1. Polyester chips: The sample is in the form of white chips mainly composed of Polyester and additives, glass fibre % of Polyester = 70.65% (Approx) % ....
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.... are not pure PBT and pure nylon chips but both are pre-dominantly consists of more than 70% of polyester and nylon. 4.1 It is pertinent to note that the chemical examiner has not answered that even though it is not pure PBT or pure nylon chips, the same will fall under polyester chips or nylon chips respectively therefore, the adjudicating authority has given of his own assumption that since the PBT and nylon chips are not pure the same cannot be considered as polyester chips and nylon chips which is very absurd observation of the learned Commissioner. It is settled law that any chemical compound is classifiable on the basis of its active ingredient only. In the present case, since both the products are admittedly pre-dominance of Polye....