M/S. Kotak Chemicals Limited vs Commissioner Of Central Excise & S.T., ...

(Arising out of OIA-RKA/81-82/SRT-I/2011 dated 28.02.2011, passed by Commissioner (Appeals) Central Excise, Service Tax & Customs, Surat)

M/s. Kotak Chemicals Limited : Appellant (s)

VERSUS

Commissioner of Central Excise & S.T., Surat : Respondent (s)

Represented by :

For Appellant (s) : Shri Devan Parikh, Senior Advocate and Shri H. Shah, Advocate

For Respondent (s) : Shri J. Nair, Authorised Representative

For approval and signature :

Mr. P.K. Das, Hon'ble Member (Judicial) Mr. H.K. Thakur, Hon'ble Member (Technical)

1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

No 3 Whether their Lordships wish to see the fair copy of the Order?

Seen 4 Whether Order is to be circulated to the Departmental authorities?

Yes

CORAM :

Mr. P.K. Das, Hon'ble Member (Judicial) Mr. H.K. Thakur, Hon'ble Member (Technical)

Date of Hearing / Decision : 13.05.2015

ORDER No. A/10603/ 2015 Dated 13.05.2015

Per : Mr. P.K. Das;

The relevant facts of the case, in brief, are that the appellant were engaged in the manufacture of Calcium Carbonate Precipitated. According to the appellant, it is classifiable under Heading No. 25.05 of the Central Excise Tariff Act, 1985, nil rate of duty. The department is of the view that it would be classifiable under heading No. 28.36 of Central Excise Tariff Act, 1985 and the duty is payable. The Tribunal by final order No. A/831/WZB/AHD/2008 dated 23.4.2008, upheld the classification under Heading 2836.90, following the earlier decisions in the case of M/s. Chaturgia Bio-chemicals Limited  2001 (131) ELT 173 (Tri. Del.) and Gulshan Sugar & Chemical Works  2002 ((150) ELT 890 (Tri. Del.), upheld by the Hon'ble Supreme Court as reported in 2005 (179) ELT A-205 (SC). The Tribunal remanded the matter for re-quantification of duty with certain directions. The appellant challenged the order of the Tribunal before the Hon'ble Supreme Court, which was dismissed as reported in -2009 (243) ELT 321 (SC). In terms of the order of the Tribunal, the adjudicating authority quantified the demand of duty alongwith interest and also imposed penalty on the appellant. By the impugned order, the Commissioner (Appeals) upheld the adjudication order to the extent penalties are set-aside. Hence, the appellant filed this appeal.

2. Learned Senior Advocate on behalf of the appellant fairly submits that they are contesting the demand of duty on merits. He submits that the adjudicating authority by the adjudication order, disposed of five show cause notices, for the period from July 1997 to February 1997 in respect of two show cause notices and for the period February 2001 to November 2011 in respect of three show cause notices. He submits that the adjudicating authority decided two show cause notice in respect of the period July 1997 to February 1997 and no personal hearing was granted. The main contention of the learned Senior Advocate is that earlier the Commissioner (Appeals) decided this issue in favour of the appellant and upheld classification under Chapter 25 vide Order (Appeal) dated 28.11.1990. Thereafter, the Central Excise officers had undertaken search and seized the goods, which was challenged before the Hon'ble Gujarat High Court. By judgment dated 29.09.1994, in Special Civil Application No. 10534 of 1994 (Kotak Chemicals Limited vs. UOI), the Hon'ble High Court quashed the proceedings on seizure of the goods with certain directions to the Revenue. Again, show cause notices were issued which were decided in favour of the appellant by the Commissioner (Appeals) vide OIA dated 25.02.1998. The Commissioner (Appeals) set-aside the adjudication order following the Hon'ble High Court order which is binding on time-barred. In this factual background, the Assessing Officer has no power to issue show cause notices and the demand of duty is not sustainable on this ground alone. He relied upon the following decisions:-

(a) Eco Valley Farms & Foods Limited vs. CCE, Pune-II  2013 (290) ELT 49 (Bom.)

(b) Prayagraj Dyeing & Printing Mills Pvt. Limited vs. UOI  2013 (290) ELT 61 (Guj.)

(c) Priya Blue Industries Limited vs. Commissioner of Customs (Prev.)  2004 (172) ELT 145 (SC.)

(d) Ashfa Himarc vs. UOI  2004 (172) ELT 147 (Del.)

(e) Lamifab & Papers Limited vs. CCE & Cus., Aurangabad  2012 (275) ELT 93 (Tri. Mum.)

(f) Print-n-Pack Pvt. Limited vs. CCE, Ahmd  2012 (275) ELT 95 (Tri. Ahmd.)

(g) Mahindra & Mahindra Limited vs. CCE, Belapur  2008 (222) ELT 474 (Tri. Mum.)

(h) Solid Containers Limited vs. CCE, Thane  2010 (262) ELT 269 (Tri. Mum.)

(i) Rajasthan Drugs & Pharmaceuticals Limited vs. CCE, Jaipur  2005 (184) ELT 71 (Tri. Del.)

(j) RBF RIG Corporation vs. CC (Imports) Mumbai  2011 (264) ELT 486 (SC).

He drew attention of the Bench to the relevant portions of the above decisions.

3. On the other hand, the learned Authorised Representative for the Revenue reiterates the findings of the Commissioner (Appeals). He submits that the three show cause notices for the period from February 2001 to November 2002 were decided by the Tribunal vide final order dated 23.4.2008 which was upheld by the Hon'ble Supreme Court as reported in 2009 (243) ELT 321 (SC). It is submitted that the Tribunal order is merged with the Hon'ble Supreme Court order and therefore, adjudicating authority has rightly passed the de-novo adjudication order. In respect of the other two show cause notices, it is submitted that they are also on the identical issue, which are covered by the decision of the Tribunal

4. After hearing both the sides and on perusal of the records, we find that the three show cause notices dated 25.1.2002, 22.10.2002 and 18.2.2003 for the period February 2001 to November 2002, have already decided by the Tribunal, which is upheld by the Hon'ble Supreme Court. In our considered view, the demand of duty on these three show cause notices have already been merged with the Hon'ble Supreme Court decision. The appellant is not contesting the classification of the goods on merit. Hence we do not find any force in the submission of the learned Senior Advocate and there is no need to discuss the case laws, as the present case is covered by the decision of the Honble Supreme Court against the appellant.

5. We find force in the submission of the learned Senior Advocate in respect of confirmation of the demand of duty for the show cause notices dated 16.6.1997 and 04.3.1997. It is contended that no notice of hearing was issued in respect of the said show cause notices. So, confirmation of demand of duty alongwith interest and penalties in respect of the said two show cause notices are not sustainable.

6. In view of the above discussion, we upheld the demand of duty in respect of the show cause notices dated 25.1.2002, 22.10.2002 and 18.02.2003. The demand of duty in respect of show cause notices dated 16.6.1997 and 04.3.1997 are set-aside and the matter is remanded to the adjudicating authority for fresh adjudication, after giving proper opportunity of hearing. We make it clear that we have not expressed any opinion in respect of the said two show cause notices. Appeal is disposed of in above terms.

(Dictated and pronounced in the Court)

(H.K. Thakur) (P.K. Das) Member (Technical) Member (Judicial) ..KL

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