ORDER
Jyoti Balasundaram, Member (J)
1. The appellants herein are engaged in the manufacture of automatic data processing machines and computer peripherals and parts thereof. With the introduction of the CETA 1985, w.e.f. 1-3-1986, they had been classifying computer peripherals under Heading 84.71 and seeking exemption under Notification 64/86, dated 10-2-1986. For the period in dispute viz. 8-3-1986 to 28-2-1987, they filed a classification list No. 1/86-87 w.e.f. 1-3-1986. They filed a classification list No. 1/86-87 in which they classified computers and peripherals under Heading 84.71 and claimed exemption from basic duty in terms of Notification 64/86 and exemption from special excise duty under Notification 171/86 and 175/86. They also furnished a complete list of entire range of peripherals manufactured by them, as annexure to the classification list which was approved on 30-5-1986. A show cause notice dated 25-2-1991 was issued to the assessees proposing recovery of Rs. 56,61,926/- on the ground that computer peripherals fell for classification under Heading 84.73 and were not entitled to the benefit of exemption under Notification 64/86 since this Heading was riot specified in the Notification. The adjudicating authority upheld classification of peripherals under Heading 84.73 and confirmed a duty demand of Rs. 32,12,986 and withdrew the demand of the remaining amount of Rs. 24,48,940/- pertaining to computers which stood exempted under Notification 64/86 during the relevant period. A penalty of Rs. 5 lakhs has also been imposed against the appellants. Hence this appeal.
2. We have heard Shri Rohan Shah, learned Counsel and Shri H.K. Jain, learned SDR.
3. We see force in the submissions of the learned Counsel that the demand is entirely barred by limitation. The appellants clearly described the goods in dispute in their classification list as peripherals and parts for computers and also attached a list of all the peripherals and parts. It is not the case of the Department that the goods did not correspond to the description given in the list. The only ground on which the extended period of limitation has been held to be applicable is that the appellants did not declare the correct nature of the peripherals and parts and their functions, giving an impression that peripherals and parts are automatic data processing unit and, therefore, they had suppressed the fact and misdeclared peripherals and parts for business systems computers as falling under Heading 84.71 which were in fact classifiable under Heading 84.73. We fail to understand how the Department gathered such an impression, in the face of the clear description and details of the various items in dispute. Claiming a classification different from what is ultimately approved by the Department, does not amount to suppression. It is open to an assessee to claim classification under any Heading and it is the responsibility of the Revenue to arrive at the correct classification after examination of full facts. The allegation and finding of suppression and misdeclaration is, therefore, unfounded and unsustainable and we set aside the same. In the result, we set aside the impugned order holding that the demand is entirely barred by limitation and allow the appeal on this ground, without going into the issue of correct classification of the disputed goods.