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2009 (10) TMI 348 - AT - Central ExciseValuation- Modular Terminal Rossette (MTR) is a plastic box with provision to plug in a male jack and can facilitate connection of phone to the external line. It is an accessory to telephone. The appellants M/s. ITEL Industries (ITEL) got MTRs manufactured on job work basis with the components it supplied. These were cleared separately as well as along with the electronic push button telephones manufactured by ITEL. It is since settled vide Final Order No. 89-90/01 dated 24-1-01 of the Tribunal that assembling MTR from bought out components constitutes manufacture. The department had issued the following show cause notices to recover duty on MTRs cleared by ITEL. Held that- if the goods were under provisional assessment, differential duty could be recovered without issuing a Show Cause Notice u/s 11A of the Act. Demand could not validly be confirmed invoking longer period as no suppression is found against ITEL. The impugned order held that the dispute involved interpretation. We hold that no penalty is imposable on the appellants for its failure to pay duty demand sustained by us since the dispute involved interpretation. The impugned order is set aside. The appeal is allowed in part by remand to the original authority to requantify the demand allowing benefit u/s 4(4)(d)(ii) of the Central Excise Act, and Cenvat credit of duty paid on the inputs since reversed.
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