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2009 (12) TMI 242 - AT - Central ExciseSoap- Penalty- The appellant is engaged in the manufacture of soaps of different varieties such as Nivea Soap, Johnson & Johnson Baby Soap and Tetmosol Soap etc., on job work basis. The dispute in the instant case relates to the classification of Tetmosol Soap manufactured by the Appellant on job work basis for M/s. Nicholas Piramal India Limited. The appellant had classified the product as a “Soap, other than for toilet use, whether or not containing medicament or disinfectant” under sub heading 3401.11 of Central Excise Tariff Act, 1985. On the basis of said classification, the appellant opted to discharge appropriate duty applicable. The department took the stand that the impugned product is not a medicated soap and hence ought to be reclassified as toilet soap under sub-heading 3401.19 of Central Excise Tariff Act, 1985. Consequent on such reclassification the department demanded the differential duty as well as penalty for the period May 2003 to December 2003 by issuing show cause notice to the appellants. Held that- The Tribunal passed the order on 13-5-2005, whereas the show cause notice related to the year 2003. Therefore, it cannot be said that there was any suppression of facts or willful mis-declaration, fraud or collusion etc. In view of the above position, while on merits, we find that appellants have no case and therefore, they are required to pay the duty demanded with interest as applicable, penalty imposed on them under Section 11AC read with Rule 25 of Central Excise Rules, 2002 is set aside. The appeal is partly allowed.
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