TMI Blog2010 (6) TMI 446X X X X Extracts X X X X X X X X Extracts X X X X ..... 76 and not under 39. If one reads the appellants submissions in the year 1996, it is apparent that there was no clear description in the said declaration. It was not for the appellants himself to decide whether the classification would be under 76 or 39 irrespective of the description of the product and on the contrary, it was necessary for the appellants to give detailed description of the product in the declaration. This is more so, in view of the self-assessment procedure. Non-declaration of the correct description could have helped the appellant in justifying their claim is a totally different issue. But the fact remains that correct description of the product was not revealed in the declaration. In those circumstances, certainly mis-statement can not be said to be un-intentional. - Decided against assessee Merely because one of the said Managers was authorised signatory to defence filed in the case, that would not be sufficient to construe that he was responsible for the mis-statement. Being so, the penalty against the Managers cannot be sustained. In the result, the appeal filed by the appellant company fails whereas the appeals filed by the Managers succeed. - E/1868-18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eclaring the said product along with the classification in the monthly RT-12 returns. 5. A show cause notice dated24-2-2000came to be issued to the appellants on the ground that the product in question merited classification under Chapter 39 and not under Chapter 76 as was claimed by the appellants. However, under order dated31-5-2004, the said proceedings were dropped holding that in terms of Board s Circular dated6-12-2003, the product was classifiable under sub-heading 76.07. 6. The appellants were again issued with show cause notice on9-2-2001proposing the classification of the product under Chapter 39 and requiring the appellants to show cause as to why the duty should not be ordered to be paid for the period December, 1996 to July, 1999. Though the proceedings were contested by the appellants, the adjudicating authority, relying upon the decision of the Apex Court in the matter of Sharp Industries v. CCE Mumbai-III reported in 2005 (188) E.L.T. 146 (S.C.) held that the product in question was classifiable under Chapter 39 and not under Chapter 76. It was specifically held that the product was classifiable under sub-heading 3923.90 and not under sub-heading 7607.90 as was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at it further disclosed confirmation of the description of the product manufactured by the appellants and knowledge thereof to the department. Considering the same, according to the learned advocate, the finding by the learned Commissioner that there was mis-statement as regards the description of the product in the declaration filed by the appellants on19-11-96is contrary to the materials on record. The authorities below having approved the invocation of extended period of limitation solely on the basis of alleged mis-statement in the declaration and there being no mis-statement in the declaration, the learned Commissioner clearly erred in holding that the department was justified in invoking the extended period of limitation. Further, drawing our attention to the tariff entries under sub-headings 76.07 as well as 39.20, learned advocate submitted that for the purpose of classification of such product under either of the entries, it is immaterial whether the product is covered on both sides or on one side. Being so, by no stretch of imagination it can be said that it was the duty of the appellants to specifically mention in the declaration that the product is covered on both sides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he fact that the Aluminium Foil laminated with plastic material (polyester film and polythene) on both sides in the declaration itself which they had failed to do and therefore, no fault can be found with the impugned order wherein it has been stated that there was mis-statement by the appellants regarding the description of the product. For the same reason, according to the learned DR, there was suppression of facts as such by the appellants so as to justify invokation of extended period of limitation. 9. He further submitted that even a part of the product (to the extent of export) the appellants themselves classified the product under chapter heading 39. 10. Being so, according to the learned DR, it cannot be said that the department had knowledge about the detailed description of the product manufactured by the appellants prior to July, 1999 and hence, the department was justified in invoking the extended period of limitation. 11. Learned Advocate for the appellants drawing our attention to the decision of the Tribunal in Sharp Industries (supra) submitted that the matter in the said case was similar to the case in hand. In that case, the Tribunal clearly observed that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re separated by a layer of another material such as foil, paper etc. provided they retain the essential characteristics of articles of plastic. The test reports show that the concerned products retain the characteristics of plastic. Therefore on merits also we find that the view taken by the lower authorities is the correct view. 14. The Apex Court, therefore, has clearly stated that the word backing relates to coating of a product only on one side whereas in case of coating on both sides of the product, it amounts to sandwiching the product in such coatings. It has been specifically submitted that there can never be backing on both sides . In other words, the term backing refers to a coating on only one side. In case of coating on both sides, it is not to be described as backed by material used for coating. Considering the same, it is difficult to accept the submissions made on behalf of the appellants that description of the product in the declaration given on19-11-1996was not a mis-statement but a correct declaration. 15. It is further contended on behalf of the appellants that at the relevant time, the ruling of the Supreme Court was not available and the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plastic classifiable under heading 7607.90. The description was not for the declaration of aluminium foil laminates coating with paper/plastic or the product being classified under chapter 39. Considering the nature of the description of the product in the inspection note, it cannot be said that the department had knowledge about the fact that the product manufactured was having coating of plastic as such as sought to be contended by the appellants. 13. It is pertinent to note that it was the case of the appellants that there was nothing to suggest in the Chapter 76 that aluminium foil backed with plastic only on one side would fall under the said chapter and that if it is coated by plastic on both sides, it would be under Chapter 39. The aluminium foil whether it is backed on one side or coated on both sides would fall under sub-heading 7607 and that was their reply dated1-9-99to letter dated13-7-1999. This apparently disclosed that the appellants consciously had taken the stand that irrespective of the fact that the product was coated on both sides with plastic, it would fall under chapter 76 and not under 39. If one reads the appellants submissions in the year 1996, it is appa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entional. Being so, we do not find any infirmity in the finding given by the learned Commissioner in this regard. 15. As regards the penalties imposed against the Ex-Manager and Manager of the Company, as rightly pointed out by the learned Advocate for the appellants, the impugned order no way discloses any material having been relied upon to show the involvement of said Managers in relation to mis-statement and, therefore, the said Managers could not have been held responsible or liable to pay any penalty in the matter. Merely because one of the said Managers was authorised signatory to defence filed in the case, that would not be sufficient to construe that he was responsible for the mis-statement. Being so, the penalty against the Managers cannot be sustained. In the result, the appeal filed by the appellant company fails whereas the appeals filed by the Managers succeed. Accordingly, the appeal filed by the appellant company is dismissed while the appeals filed by Managers to the extent of penalty imposed under the impugned order is concerned are allowed and the order in that regard only is set aside. The order against the appellant company is maintained. 16. The appeals ar ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
