ORDER
J.H. Joglekar, Member (T)
1. On hearing Shri J.C. Patel, for the applicants and Shri A.K. Jain for the Revenue it was felt that the appeal itself could be taken up for disposal. Both sides agreeing this was done after granting waiver of pre-deposit of Rs. 3,26,157=17 demanded as duty and Rs. 50,000 imposed as penalty.
2. The appellant manufactures woven wire mesh of polypropylene as well as ethylene terra fluoro ethylene. Vide classification list effective from 1/45/1994 (sic) [1.4.1994] the goods were classified under Chapter 39. However, vide another classification list effective from 3.2.1995 the classification claimed was under Chapter 49 as textile products for special industrial purpose. Consequent to amendment in Rule 173B in Central Excise Rule Rules, 1944 a formal declaration was filed effective from 1.4.1995 claiming the same classification. The jurisdictional Superintendent vide letter dated 2.1.1996 opined that the earlier classification was correct and requested for details of clearances made under the revised classification and also sought technical data etc. The assessee filed reply on 5.2.1996 giving the required details. However, instead of issuing an order on classification, the jurisdictional Range Officer issued 4 show cause notice-cum-demand covering the period August 1995 to March 1997 alleging short levy of Rs. 3,26,157/17 on the basis of wrong classification. After hearing the assessee the Assistant Commissioner passed a single order upholding the classification under 3904.90 and confirmed the demand. While upholding this order the Commissioner (Appeals) made the following observations:
It is observed from the case records that the product manufactured by the appellant is rightly covered by heading 39.01 to 39.14 of Central Excise Tariff Act, 1985 as the raw material used in the finished product is plastic in primary form. As per Chapter Note 1 of Chapter 39, if the goods are manufactured out of the basic raw materials having primary form of plastics, in that case the product manufactured out of such raw material are classifiable in the Chapter 39 of Central Excise Tariff-Act, 1985.
The present appeal is against this order.
3. We have examined the samples placed on record by the appellant. The contested goods are not products of primary plastic but are woven out of filaments of PPE and ETFE. Therefore the Commissioner (Appeals) had made an error in his observation that the product were plastic in primary form. We observe that the assessee did have the liberty to file a classification list different from what had earlier been filed and had been approved. In these circumstances it was required of the jurisdictional officer to examine afresh the claim made by the appellant and to give opinion on the classification latter claimed. Then and thereafter only would be able to allege short levy. In the present case we find that the present classification claimed under Chapter 59 was not at all considered by the jurisdictional Assistant Commissioner, who in the presumption that the fresh classification was wrong caused the show cause notices to be issued. The order confirming the demand thus suffers from this grave infirmity.
4. We allow the appeal and remand the proceedings back to the jurisdictional Assistant/Deputy Commissioner. He will first decide the classification of the contested products. In doing so he shall take the assistance of the chemical authorities. He shall thereafter proceed in an appropriate manner on the basis of the material available before him and pass orders according to law.