Full Judgment Text
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CASE NO.:
Appeal (civil) 6559-6560 of 1997
PETITIONER:
Commissioner Of Customs & Central Excise & Ors.
RESPONDENT:
M/s Charminar Nonwovens Ltd.
DATE OF JUDGMENT: 05/05/2004
BENCH:
CJI & G.P. MATHUR.
JUDGMENT:
J U D G M E N T
(With C.A. Nos.776/1999, 3568-3571/2000, 6270-
6271/2000, 6447-6448/2000, 341-344/2001,
4446/2001, 6198/2001, 1810/2002)
RAJENDRA BABU, CJI:
CIVIL APPEAL NOS.6559-6560 OF 1997
In these matters the question for our
consideration is whether Floor Coverings and Filter
Fabrics are to be classified under sub-heading
No.5703.90 of the Tariff Item attracting duty at the
rate of 30% ad valorem or whether it should be
classified under sub-heading 5703.20 attracting duty at
the rate of 5% ad valorem. A detention memo issued
to the respondent stating that the goods lying in the
factory premises, specified in the schedule, were liable
for confiscation. The respondent was ordered not to
dispose of the goods in question or otherwise deal with
or part with the same unless he heard in the matter to
the proper Central Excise Authority and a notice was
issued on 5.11.1996 to the respondent to show cause
as to why the goods should not be classified as stated
above.
The respondent filed a writ petition before the
High Court of Andhra Pradesh challenging this show
cause notice and the detention order. On an earlier
occasion on similar adjudication, the appellate authority
had upheld the claim of the assessee. The High Court
proceeded on the basis that the appellate order had
become final and expressing agreements with the
same, quashed the notice. The argument on behalf of
the appellant is that if the view of the High Court is
correct a classification cannot be reviewed and any
such classification once made cannot be reviewed even
if the earlier view is erroneous, and such a course
would result in great loss of revenue was not accepted
and allowed their petition and quashed the show cause
notice. Hence this appeal.
The matter relating to commodity classification
whether it falls under one heading or the other or
attracts higher or lower duty has to be decided on facts
arising in each case. Even though, the decision may
have been taken earlier at one point of time but on
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further investigation discover new fact or the law has
changed, as is the stand in the present case, the
matter has to be re-examined. It is not at all proper
for the High Court to interfere in such matters at the
stage of issue of the show cause notice. We, therefore,
set aside the order made by the High Court and remit
the matter to the concerned authority for adjudication.
It shall be open to the respondent to file reply to the
show cause notice as they deem fit, if not already filed
within a period of one month from today or such
further time as may be allowed by the Adjudicating
Authority. We direct the Adjudicating Authority to
dispose of the matter thereafter in accordance with
law.
The appeals are allowed accordingly.
CIVIL APPEAL NOS. 776/1999, 3568-3571/2000,
6270-6271/2000, 6447-6448/2000, 341-
344/2001, 4446/2001, 6198/2001, 1810/2002)
In these cases also identical issue as arises in C.A.
6559-60/1997 fell for consideration before the Tribunal.
The Tribunal took the view that the decision rendered
by the Andhra Pradesh High Court earlier in the case of
M/s Charminar Nonwovens Ltd. would be applicable.
Inasmuch as we have set aside the order made by the
High Court and remited the matter to the Adjudicating
Authority, we follow suit in these cases and set aside
the order of the Tribunal and remit the same to the
Tribunal for consideration of the matter afresh in
accordance with law.