LexJAISHRI ENGINEERING CO. (P) LTD. versus COLLECTOR OF CENTRAL EXCISE, BOMBAY
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A B c D E F G H JAISHRI ENGINEERING CO. (P) LID. v. ·COLLECTOR OF CENTRAL EXCISE, BOMBAY MARCH 2, 1989 [SABYASACHI MUKHARJI ANDS. RANGANA1HAN, JJ.) Central Excises and Salt Act, 1944.-Section 11-A proviso 35L and First Schedule Items 52 and 68-Whether goods in question were nuts being mere fasteners or end fittings and integral parts of diesel engine pipes-Classification of goods manufactured-functional approach to identity of goods-Whether there was suppression of facts by the assessee-A question of fact-Tribunal free to fix quantum of penalty. The appellant-company applied for a requisite central excise licence .for manufacture of goods falling under Tariff Item 68 and for the purpose l\f such goods L-4 licence was also furnished and also the requisite ground plans of the factory in which the various goods were manufactured. The excise authorities granted L-4 licence. The appel- lant claimed benefit of exemption of Notification No. 89/79-CE dated March 1, 1979. The classification list submitted by the appellant was approved by the Assistant Collector by his letter dated May 25, 1979. For the period April 1, 1979 to June 30, 1979 the appellant filed his RT-12 for assessment which was also finally assessed without any pro- test or objection. As the appellant claimed that his goods were wholly exempted by virtue of notification No. 89/79-CE dated March 1, 1979, the appellant wrote to the Superintendent asking for dispensation from filing RT-12 every month. The Superintendent informed the appellant that it need not file RT-12, but should inform the excise authorities monthly by means of a simple letter the total clearance effected in the month in question. Thereafter, the appellant submitted classification list in 1980, 1981 and 1982 and claimed benefit of exemption under notification No. 105/80-CE dated June 19, 1980. The Assistant Collector approved the class.ification list. The Central Excise Officer attached to the preventive branch visited the factory in July 1982 and examined the products manufac- tured by the appellant. In January 1983, a show-cause notice was issued to the appellant asking it to show-cause as why excise duty should not be demanded under Tariff Item 52 in respect of the piece of nuts manu- 870 -:, ~ 1 ~ 1 -.;. JAISHRI ENGG. v. COLLECTOR OF C.E. 871 factored and removed by the appellant during the period April 1, 1981 to July 19, 1982 without payment of appropriate excise duty thereon, and also to show-cause why penalty should not be imposed for failure to obtain the requisite L-4 licence under Tariff Item 52 and to show cause why the material seized on August 26, 1982 should not be confiscated. A The appellant showed cause and drew the attention of the B authorities to the fact that the goods in question were not nuts but end products or connectors for lubricating purposes and as such were integral parts of Diesel Engine Pip,es falling under Tariff item 68. The Collector of Central Excise passed orders on July 16, 1984 holding that fittings were nuts classifiable under Tariff Item 52, and C that appropriate duty on.the clearance effected by the appellant during the period April 1, 1981 to July 19, 1982 should be paid and tbe seized goods were liable to confiscation but in lieu thereof a redemption fine of Rs.4,000 could be paid. The Collector also imposed a penalty of Rs. 1 lakh. The appellant went up in appeal before the Tribunal, which partly allowed the appeal and partly upheld the order of the Collector. With regard to classification of the different fittings was concerned, it D j.. was held that the classili~ation should have been as nuts under Tariff Item 52 of the Central Excise Tariff. It further held that the appellant was guilty of suppression and therefore rejected the submission of the E appellant that the show-cause notice was barred by time. It, however, reduced the amount of Penalty imposed by the Collector from Rs.1 lakh to Rs.50,000. The appellant appealed to this Court by special leave. In the appeal to this Court, on the question whether the goods manufactured F by the appellant were end products or connectors for lubricating purposes and as such were integral parts of the Diesel Engine Pipes falling under Tariff Item 68 as claimed by the appellant or nuts classifi- able under Tariff Item 52. Dismissing the appeal, HELD: 1. The Tribunal was right in classifying the goods under Tariff Item 52
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