TaxTMI 
TaxTMI 
1995 (6) TMI 32
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....iod from 4th August, 1985 to 3rd February, 1986 invoking Section 11A of the Central Excise and Salt Act, 1944. The impugned demand is based on review of 'classification lists/lists' pertaining to the said product which was/were approved by the department from time to time and duly acted upon until reviewed by Order dated 27th April, 1987 passed by the Collector of Central Excise (Appeals) in the review application filed by Assistant Collector of Central Excise. The basic question which arises for consideration of the Court in this petition is as to from which date the said order dated 27th April, 1987 would operate. The relevant facts are set out hereinafter. 2.A few facts are required to be set out before considering the submissions mad....
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....ise, Panaji be annulled and M/s. Geno Pharmaceuticals Ltd., Karaswada, Mapusa, may be directed to pay the duty on the Product 'PROTECTONE', under the Tariff Item No. 68 of Central Excise Tariff." During the earlier period, also, the classification list filed by the petitioners was duly approved and the petitioners were treated as exempted from payment of excise duty in view of applicability of exemption notification referred to hereabove. 5.It appears that the Central Excise Department changed its opinion in respect of classification of the said Item under Tariff Item 1B of the Central Excise Tariff and the applicability of the exemption Notification No. 17/70 in respect of the above referred Item as late as 24th January, 1986. Sectio....
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....emption notification relied upon by the petitioners was not available to the petitioners. The approval of earlier classification list submitted by the petitioners was annulled by the said order dated 24th April, 1987. 7.The learned counsel for the petitioners has submitted that the re-classification of the product in question, in pursuance of the decision of the Reviewing Authority can be made operative only from the date of issue of show cause notice by the Reviewing Authority to the assessee. The learned counsel emphasized that in this case the earlier classification list was not merely approved by the Department but was acted upon for several years. It is not disputed that the relevant show cause notice was issued to the petitioners a....
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....he classification list accepted by the Department and acted upon earlier was erroneous in law and a notice of demand was thereafter issued for recovery of short-levied excise duty under Section 11A of the Central Excise and Salt Act. In paragraph 4 of the judgment of the Apex Court cited above, R.M. Sahai, J., speaking for the Apex Court inter alia observed that in such situations, the re-classification of the product shall be effective from the date the Department issued the show cause notice. This was a case where the price list was accepted by the Department and acted upon and later on the Department took the view that the price list submitted by the assessee was erroneous and the assessable value was liable to be calculated in a differe....
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....d that once the question relating to the correctness of the classification was at large by way of an appeal, the original order would merge with the appellate order and the order of the appellate authority would come into operation on and from the date the classification list was filed. Relying on this decision, the learned counsel for the revenue submitted that the revised classification list in respect of the said product would in any event operate from 26th August, 1985, being the date of approval of the classification list set out in paragraph 2 of the application for review dated 24th January, 1986. Having regard to the clear pronouncement of the Supreme Court in the case of M/s. Rainbow Industries (P) Ltd. v. Collector of Central Exci....