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M/s. Khaitan Agro Versus CCE & ST, Indore

2017 (1) TMI 494 - CESTAT NEW DELHI

Imposition of penalty - Classification of intermediate product in dispute for long time - Soya Gums - Held that: - Ultimately, the classification of the product under heading 1522 has been accepted by the assessee and differential duty paid. Under the circumstances, I am of the view that the benefit of section 11A (2)(B) cannot be extended in view of the explanation-1. - The appellant will be entitled to the benefit of payment of penalty of 25% of the differential duty as the differential du .....

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gaged in the manufacture of Refined Soya bean Oil. During the process of making Refined Soya bean Oil, certain other products which emerged are Soya Gums, Soya sludge, Fatty Acid, Deodorized Distillate etc. The present dispute is with respect to the product prescribed as Soya Gum . The appellant was originally classifying the product Soya Gum under chapter heading 15220090, but subsequently changed the classification to 13019019 from the month of May 2007. The classification was again changed in .....

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ial Central Excise duty to the extent of ₹ 17,78,541/- along with the applicable interest amount of ₹ 1,49,098/- and the same was intimated to the Revenue authorities on 08.09.2008. However, the Show Cause Notice dated 15.10.208 was issued and the order in original dated 13.06.2009 was passed in which duty and interest paid by the assessee was confirmed along with penalty equal to the amount of duty under section 11AC of the Central Excise Act, 1944. When the issue was challenged bef .....

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as well as interest before issue of Show Cause Notice. Accordingly, he submitted that, in terms of section 11A (2) (B), no penalty will be imposable. 5. Ld. AR, on the other hand supports the order of the authorities below. He argued that differential duty has arisen as a result of mis-statement by the appellant. He submitted that the product Soya Gum has not only been misclassified but even wrongly described as Soya Oil Sludge, with a view to camouflage the real product. Accordingly, he submitt .....

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. However, during the period May 2007, the assessee has changed the classification to chapter 1301 along with change in description of the item to Soya Oil Sludge. As a result of the investigation undertaken by Revenue, it is established that the product cleared has remained the same but described differently. Ultimately, the classification of the product under heading 1522 has been accepted by the assessee and differential duty paid. Under the circumstances, I am of the view that the benefit of .....

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