TaxTMI 
TaxTMI 
2026 (1) TMI 1344
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....2 of CETA. It is alleged that constituents of Xylene contained in the Mixed Xylene manufactured by the appellant is less than 82.72%; hence it merits classification under Chapter heading 2707 instead of 2902 of CETA, 1985. Consequent to completion of the investigation, show-cause notice was issued on 02.05.2017 demanding differential duty of Rs.11,74,60,396/- for the period from April 2012 to September 2016 along with interest and penalty. On adjudication, the demand was confirmed with interest and penalty of equivalent amount. Hence, the present appeal. 3.1. At the outset, the learned advocate for the appellant has submitted that the manufactured product Mixed Xylene is classifiable under Entry 29024400 of CETA, 1944. He has submitted that a combination of Ortho-xylene, Meta-xylene and Para-xylene i.e. Mixed Xylene is classifiable under the said Tariff Entry 29024400 of CETA, 1985. Relying on the Chapter Note 1(a)/(b) to Chapter 29 of CETA, he has submitted that it includes separate chemically defined organic compounds and mixtures of two or more isomers, which originate from the same organic compound. There is no specification prescribed in the Chapter Note which makes referen....
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....an amount of Rs.4,86,61,783/- along with interest much before issuance of show-cause notice; hence, applying Section 11A(2) of the Central Excise Act, 1944 (CEA, 1944), the show-cause notice itself should not have been issued for the period September 2014 to September 2016. 3.3. Learned advocate for the appellant has further submitted that the demand has been confirmed invoking extended period of limitation for the period April 2012 to March 2015. He has submitted that in the year 2007 itself, the appellant had intimated the Department on the issue of classification of Mixed Xylene adopted by them and had been filing ER-1 returns periodically wherein the details of Mixed Xylene cleared by them had been correctly declared including the classification adopted by them. Also, he has submitted that the Department has been conducting regular Central Excise audit and in all audit reports, it is duly recorded that Mixed Xylene is manufactured by the appellant classifying the same under Tariff Entry 29024400. Further, he has submitted that wrong classification of the product cannot termed as suppression of fact or misdeclaration when the constituents of the product has been disclosed to ....
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....ispute in the present appeal relating to classification of the manufactured product viz. Mixed Xylene which the appellant claimed to be classifiable under Chapter sub-heading 29024400 attracting 12% ad valorem, whereas, the Revenue's allegation is that the product in question is classifiable under Tariff 27073000 attracting 14% ad valorem; also, whether the demand can be confirmed invoking extended period of limitation for the period 2012 to 2016. 7. The competing Tariff entries read as under:- Chapter sub heading 2707 30 00 Tariff Item Description of goods Unit Rate of duty (1) (2) (3) (4) 2707 2707 30 00 Oils and other products of the distillation of high temperature coal tar similar products in which the weight of the aromatic constituents exceeds that of the non-aromatic constituents - Xylol (xylenes) .. ... ... ... ... .... ... ... ... ... ... ... Kg. 12.5% Chapter sub-heading 2902 44 00 Tariff Item Description of goods Unit Rate of duty (1) (2) (3) (4) 2902 2902 44 00 Cyclic hydrocarbons -- Mixed xylene isomers .. ... ... ... ... .... &nb....
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....rs and Ethyl benzene, the xylene content being only 82.4%. The assessee has claimed that Ethyl benzene and Dimethyl benzene (xylene) are the same organic compound, which is unacceptable to Chemistry. Ethyl benzene and Dimethyl benzene are different organic compounds, the former being the ethyl derivative of benzene and the latter being dimethyl derivative of benzene. The two compounds are two different derivatives of benzene and hence two different organic compounds. Hence the subject goods, which is a mixture of dimethyl benzene and ethyl benzene, cannot be considered as a "mixture of two or more isomers of the same organic compound". It docs not attract Note 1 (b) to Chapter 29. On the other hand, the following HSN Note (relied on by Id. SDR) would clinch the classification issue under consideration : "Xylene (dimethyl benzene) (C6,H4,(CH3;)2). A benzene derivative in which two atoms of hydrogen have been replaced by two methyl groups. There are three isomers : o-xylene, m-xylene and p-xylene. Xylene is a clear, inflammable liquid found in light coal tar oil. To fall in this heading, xylene must contain 95% or more by weight of xylene isomers, all isomers being ....
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....ed vs. Commissioner of Central Excise, Pune-1 [2022 (382) E.L.T. 442 (S.C.)], the Hon'ble Supreme Court emphasizing the role of HSN in understanding and resolving the classification dispute under Central Excise Tariff Act observed as: "6. The definition of a product given in the HSN should be given due weightage in the classification of a product for the purpose of levying excise duty. This is because in the Statement of Objects and Reasons of the Bill leading to enactment of Central Excise Tariff Act, 1985, it was clearly stated that the pattern of tariff classification is broadly based on the system of classification derived from the International Convention on the Harmonised Commodity Description and Coding System (Harmonised System) with such contraction or modification thereto as are necessary, to fall within the scope of the levy of Central Excise duty. The tariff so suggested for the levy under the Indian Tariff Act is based on an internationally accepted nomenclature, in the formulation of which, all considerations, technical and legal, have been taken into account. This was done to reduce avoidable disputes on tariff classification. Besides, the tariff would be on....