TMI Blog1983 (10) TMI 262X X X X Extracts X X X X X X X X Extracts X X X X ..... t of this order and, therefore, it is proposed to set out at this junture, only the salient facts. The appellants are manufacturers of Polyurethane Foam (P.U.F.) which is an article falling under Item No. 15A of the Central Excise Tariff Schedule (CET). For manufacture of PUF, they imported certain raw materials, namely, polyesters and polyether. These raw materials used to be assessed by the Bombay Customs authorities to basic customs duty as resins under Heading No. 39.01/06 of the Customs Tariff Schedule and countervailing duty as resins under Item No. 15A of the CET. Item No. 15A CET has been one of the items in respect of which the benefit of Rule 56A has been extended by the Central Government. Raw materials falling under Item No. 15A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hane Foam (P.U.F.) for which they used imported polyesters and polyether - these imported products were being assessed by the Bombay Customs to countervailing duty (CVD) equal to Central Excise duty under Item 15A, Central Excise Tariff Schedule (CET). Right from 10-10-1972, the appellants were enjoying the facility of proforma credit under Rule 56A of the Central Excise Rules, of the countervailing duty on the imported raw materials towards payment of duty on the finished product, namely, P.U.F. In 1978, a show cause notice was issued by the Central Excise authority stating that the proforma credit facility under Rule 56A was not available to the appellants on the ground that the related raw materials were not resins falling under the purv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l period, namely, July 1977 to November 1977, the amount of ₹ 3,02,311.91 availed of as proforma credit was, on adjudication, held by the Asstt. Collector as not permissible and available for such credit and, therefore, to be re-credited by the appellants in their proforma credit account. In this connection, the Counsel submitted that while the Asstt. Collector was competent to grant an assessee the permission to avail himself of the facilities under Rule 56A, he was not competent to withdraw the said permission. The power to order such withdrawal was conferred only on the Deputy Collector and that too in 1981 by the Board vide E.L.T. 1981 Vol. 7 S. No. 27 of the Table on page T-68. 5. Shri Ramamoorthy further submitted that sub-ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 18-6-1977 exempting inputs dutiable under Item 68 and used in the manufacture of other goods would be available for the appellants. He also referred to 1983 E.L.T. page 1157 in which this Tribunal has held that goods could not be classified differently for basic customs duty and countervailing customs duty. 7. Shri Jain, the learned SDR, referred to the decision of the Madras Bench of the Tribunal - 1983 ECR 969-D - and submitted that, for the purpose of Rule 56A(5), wilful suppression need not be there. Non-declaration of the relevant facts was a sufficient cause. The appellants knew that the imported raw materials were not resins and they did not inform the department of the correct position. They were erroneously availing thems ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edings any classification dispute. The Customs authorities at Bombay has assessed the 2 products in question, namely, polyesters and polyethers, to countervailing duty under Item 15A CET. The appellants had acquiesced in the assessment and had accordingly paid countervailing duty. Though the very same goods, namely, polyesters and polyethers, were held to be chemicals and not resins by the Appellate Collector of Customs, Madras and this view was upheld by the Central Government on revision, it is not clear why the appellants did not bring this matter to the notice of the Bombay Customs authorities and press for classification as chemicals. It may be that the Bombay Customs authorities had assessed the goods to countervailing duty as resins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the lower authorities and direct that the proforma credit availed of by the appellants, and which was ordered to be re-credited, be restored to their proforma credit account. The relief to the appellants on the basis of this order shall be granted by the concerned Central Excise authorities within a period of 4 months from the date of communication of this order. 11. [Order per : H.R. Syiem, Member (T)[. - I agree with Sankaran s reasonings that the appeal should succeed. I would like to add a few thoughts that occur to me. 12. What the customs and excise did in Hyderabad flies in the face of what it did in Bombay. There is an unwritten law that when a tax collecting authority makes an assessment which is incorrect, it is prohibite ..... X X X X Extracts X X X X X X X X Extracts X X X X
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