TMI Blog2009 (11) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner (Appeals) granted two benefits to the assessee. Firstly, the assessee was allowed to treat the invoiced price of the goods as ‘cum-duty price’. Secondly, they were allowed to claim ‘input duty credit’. The assessee deposited duty with interest within thirty days from the date of communication of the orders of adjudication. It is submitted that they also paid penalty to the extent of 25% of the duty amount within such period. These facts are not in dispute. Therefore, our decision on the penalty-related issue will be subject to the relevant provisions of Section 11AC. - E/626-627/2006 - A/310-311/2009-WZB/C-I/EB - Dated:- 19-11-2009 - S/Shri P.G. Chacko, Member (J) and B.S.V. Murthy, Member (T) Shri T.C. Nair, Consultant wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No penalty was imposed under any other provision. Meanwhile, a second show-cause notice dated 14-5-2004 was also issued by the department demanding duty of Rs. 1,90,942/- for the period from April, 2003 to March, 2004 and proposing penalties under Section 11AC and Rule 25. Interest on duty was also demanded under Section 11AB. This show-cause notice was also contested. The adjudicating authority confirmed the above demand of duty against the assessee and imposed on them equal amount of penalty under Section 11AC. No penalty was imposed on the party under Rule 25. In appeals filed by the assessee against the two orders of adjudication, the Commissioner (Appeals) sustained the demands of duty by approving the classification of the goods under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ample of the product and therefore the product should be considered as a solution or suspension of dye in water. By virtue of this description, it is argued, the product could only be classified as ordinary writing ink under SH 3215.10. 4. Ld. SDR, on the other hand, refers to the chemical test report which states that the material may not be considered as writing ink. He also refers to the Tribunal's Larger Bench's decision G.M. Pens International Ltd. v. Commissioner, 2005 (187) E.L.T. 180 (Tri.-LB), wherein marker ink was held to be classifiable under SH 3215.90 (other) on the basis of HSN Explanatory Notes. SDR further submits that the product was supplied to buyers, who used the same for printing purposes. He submits that many of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of facts but, according to Consultant, no suppression can be alleged in this case. In this context, he has relied on the Supreme Court's judgment in Densons Pultretaknik v. Commissioner of Central Excise, 2003 (155) E.L.T. 211 (S.C.). This claim is also opposed by SDR. 7. Consultant has also argued that, in a case of this kind, involving classification dispute, no penalty can be imposed. This argument has also been contested. 8. We have given careful consideration to the submissions. At the outset, we have to reject the plea made by Consultant that the goods in question is a water-based preparation. There is no evidence, whatsoever, in support of this plea. In the very declaration filed by them, they declared that the ink was manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is well supported by the oral evidence of the assessee and their buyers. All the buyers, who were examined by the investigating officers, consistently stated that they had purchased only 'jet ink' from the assessee and had used the same in ink-jet cartridges for printing purposes. One of the witnesses even stated that the ink procured from the assessee was not usable as writing ink. Thus, the evidence on record clearly supports the classification of the product under the residuary sub heading viz. 3215.90 (other). The decision in this regard taken by the lower authorities is only to be sustained. As we have decided the classification of the goods on the facts and evidence on record in this case, we think, we need not look into any other cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wanted to use it for printing purpose only. The assessee's conduct has never been consistent with what they declared in their classification declaration. The evidence gathered by the Department also went against them. On these facts, we cannot help holding that the assessee suppressed the material facts before the Department with intent to evade payment of duty. The Apex Court's judgment cited by Consultant is not applicable to this case. 11. In the second show-cause notice, the Department did not invoke the proviso to Section 11A(1) of the Act. They, however, alleged suppression and, on this basis, a penalty under Section 11AC was proposed against the assessee. It has been consistently held by the Tribunal that, where the proviso to Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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