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2016 (3) TMI 266 - AT - Central ExciseExtended period of limitation - Availability of exemption under notification 29/2004-CE - re-classify the product under heading 7019 and to deny the exemption - sustainability to demand for extended period - Held that:- The original authority clearly indicated in the order that the appellant has declared in their ER-1 returns that they are engaged in the manufacture of clearance of dust collection bags manufactured out of cotton fabric, poly fabric and woven glass fabrics. However, the Original Authority proceeds further to state that the Chapter heading was not mentioned in respect of woven glass fabrics and this will amount to deliberate suppression of facts. We are not able to agree with such conclusion. It is an admitted fact that the appellant has declared the nature of raw material and the nature of final product. They had in their assessment and clearance documents mentioned the classification as was done for many years. In the matter of classifying the product, the assessee followed their understanding. When the material facts are disclosed, a particular classification followed by the appellant will not make a case for suppression. The Hon’ble Supreme Court in the case of [Desons Pultretaknik (2003 (1) TMI 115 - SUPREME COURT OF INDIA )] held that merely claiming a classification under a particular heading cannot be a willful misstatement or a suppression of facts. The Tribunal in the case of [AB Mauri India Pvt. Ltd. 2010 (8) TMI 348 - CESTAT, MUMBAI] held that in the case of bonafide belief of a particular classification, it cannot be said that the appellant suppressed any material fact before the Department with intend to evade payment of duty. After careful consideration of the facts of the case, we find the demand for extended period is not sustainable, and accordingly, the appeal in so far as it relates to extended period is allowed. The penalty imposed on the appellant is also set aside. The demand due to reclassification as confirmed by the Original Authority with applicable interest will be restricted to the normal period of limitation. The appeal is disposed of in these terms. - Decided in favour of assesseee
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