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2013 (10) TMI 24 - HC - Central ExciseClassification of goods - Condensing Unit of Air-conditioning Machines - Words and Phrases - Valuation - Import policy - Consumer goods – Held that:- The Tribunal had remanded the matter back to decide the dispute in view of the Circular, dated 25-9-2002 - It may be noted that there were divergent views with regard to exemption of parts of air-conditioning machine - The Central Board of Excise and Customs, New Delhi issued the aforesaid Circular, dated 25-9-2002 to set at rest the said controversy - In the circular the Board noticed the order of CEGAT in the case of Universal Commercial Corporation v. C.C., Delhi [1993 (7) TMI 220 - CEGAT, NEW DELHI ] - the components which were required for completion of one air-conditioning machine could be reconsidered as essential. Penalty u/s 11AC –Held that:- So far as the penalty was concerned the Tribunal had rightly set it aside - Mens rea is an essential part for levy of penalty - Where a provision of statute was not clear and there was divergent judicial pronouncements, it cannot be said the there was mens rea on the part of manufacturer if he chooses to follow his course of action in the light of one of the judicial pronouncements - It had been rightly observed to be by the Tribunal that the issue was one of interpretation and application of Rule 2(1) of the Interpretative Rules - The penalty matter should have been left open for re-consideration by the Commissioner Clearly, no case of levy of any penalty was made out and the penalty order was rightly set aside.
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