2005 (2) TMI 727 - AT - Central Excise

Summary

Issues: Classification of goods and limitation

Classification of Goods:
The appeal concerns the classification of goods "Relays" under CH/SH No. 8530.00 of the Central Excise Tariff Act, 1985. The appellants, engaged in the production of Electrical Signalling, Safety, or Traffic Controlling Equipment for Railways, initially classified the goods under Sub-heading 8608.00 but later re-classified them under Sub-heading 8530.00. The Assistant Commissioner classified the product under Chapter Heading 8536.90. The Board's Circular supported the classification under Chapter Heading 85.36, which was upheld by the Commissioner (Appeals). The corrigendum proposed to classify the item under Chapter 8536.90.

Limitation:
The issue of limitation arises from the demand of duty based on the revised classification. The decision in the case of M/s. Toshniwal Instruments (India) Ltd. v. CCE, Pune, and M/s. Studds Ltd. v. CCE, Delhi-II, established that the demand is time-barred. The time-limit for demanding duty is computed from when the corrigendum was issued, which was beyond the period specified in Section 11A(1) of the Act. As a result, the entire demand of Central Excise duty was considered time-barred, and the appeal by the assessee was allowed on limitation.

This judgment highlights the importance of correct classification of goods under the Central Excise Tariff Act, 1985 and the implications of time-barred demands for duty. The re-classification of goods and the subsequent dispute regarding the appropriate classification underscore the need for clarity and consistency in classification practices. The reliance on Board Circulars and legal precedents further emphasizes the significance of established guidelines and case law in resolving classification disputes. The decision regarding the limitation period for demanding duty serves as a reminder of the procedural requirements and timelines that govern such matters, ensuring fairness and adherence to statutory provisions.