9911796707
TMI Blog2023 (10) TMI 350X X X X Extracts X X X X X X X X Extracts X X X X ..... by them to M/s.Godrej Consumer Products Ltd. on payment of duty on value determined in accordance with Section 4 or Section 4A of the Central Excise Act, 1944. On verification of records, it was noticed that the appellant manufactured various products viz. GK 3ON COMBIPACK GK ADV ACTV + SYSTEM, GK SIL POW 45 CMB CSD, GK POWERLITE COM CSD and GK SIL POWER 45N CMB and put them in a Combipack, consisting of Mosquito Repellant Refill (Bought out item) and one Electrical Mosquito Repellant Device (hereinafter referred to as EMD). The appellant classified the goods under the Heading 85167920 of CETA 1985 and cleared them on payment of duty under Section 4A value of RSP availing the abatement. 2. During the period from November 2007 to March 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y for the period from November 2007 to January 2013. Show cause notices were issued to the appellant proposing to demand the differential duty along with interest and for imposing penalties. After due process of law, the original authority held that extended period is not invokable and the demand for the period November 2007 to October 2011 cannot sustain. The demand was restricted to period November 2011 to March 2012 being the normal period. The subsequent demands for the period April 2012 to January 2013 was also confirmed along with interest. The proposal to impose penalty under Section 11AC of the Central Excise Act, 1944 was dropped. However, penalty of Rs.5 lakhs was imposed under Rule 25 of Central Excise Rules, 2002. Aggrieved by s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing 3808.10 as applicable to MRR. In fact, the essential character of the combi pack is that MRR cannot be used separately and can be used only along with the machine (EMD). The essential character of the combipack being that of EMD, the classification adopted by the appellant under 85167920 is correct and appropriate. Further when the goods are not classifiable under Rule 3 (a) and Rule 3 (b), as per Rule 3 (c), the goods have to be classified under heading which occurs last in numerical order. In such circumstances also, the classification adopted by the appellant is more appropriate. To canvas that the essential character of the combipack is that of the EMD and not MRR the learned counsel relied upon the decision in the case of United St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us and refill bottle. Whether the buyer would be prompted to buy combination pack with a view to purchase the electro thermic apparatus or with a view to buy refill bottle of pesticides? In our considered view, a prospective buyer would purchase such combination pack for using it as mosquito repellent, which purpose is achieved by vaporizing the liquid pesticide by subjecting it to heat with the aid of electro thermic apparatus. This imply that electro thermic apparatus is merely a delivery machine but the real mosquito repellent is liquid pesticides contained in refill bottle. Thus, we find that the liquid pesticides bottle in the combination pack gives essential character of mosquito repellent to the combination pack. Thus, in our view, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e any suppression or misstatement with an intent to evade payment of duty. The demand was thus restricted to normal period. In the absence of any malafide intention, penalty cannot be imposed under Rule 25 of Central Excise Rules, 2002 also. The said rule states that only when there is non-payment of duty with an intent to evade payment of duty, the penalty can be imposed. 10. The findings recorded by the original authority itself shows that there was no intention to evade payment of duty and therefore the penalty imposed under Rule 25 of Central Excise Rules 2002 is not justified and requires to be set aside which we hereby do. 11. In the result, the impugned order is modified to the extent of setting aside the penalty of Rs.5,00,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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