Full Judgment Text
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CASE NO.:
Appeal (civil) 7524-7525 of 2004
PETITIONER:
Commissioner of Central Excise, Jalandhar
RESPONDENT:
M/s. Rajiv Textile Industries & Anr.
DATE OF JUDGMENT: 15/04/2005
BENCH:
Ruma Pal, Arijit Pasayat & C.K. Thakker
JUDGMENT:
J U D G M E N T
RUMA PAL, J.
During the years 1995-96, 1996-97 and 1997-98, the
respondent Textile Mills cleared grey cotton canvas clothes
and grey cotton fabrics, without payment of any central
excise duty on the ground that the products were classifiable
under Chapter 52 of the Central Excise and Tariff Act 1985
under which the rate of excise duty was nil at the relevant
point of time. According to the Revenue Authorities the
goods were classifiable under sub-heading 5911.90 of the
Tariff and liable for central excise duty at the rates specified
on the Tariff. A show cause notice was issued on 27th
December, 2000 why central excise duty should not be
recovered and why penal action should not be taken against
the respondent. In the meanwhile the respondent- Textile
Mills were closed down in September, 1997 and M/s. Moti
Lal Traders started functioning from the same premises with
the same machinery.
The Additional Commissioner of Central Excise relying
on the case of M/s. Simplex Mills Co. Ltd. Vs CCE
Nagpur: 1993 (49) ECR 147 confirmed the demand of
duty and also imposed personal penalty on the respondent
and ordered interest on the delayed payment. Duty was also
demanded from M/s. Moti Lal Traders and personal penalty
as well as interest was levied.
The respondent and M/s. Moti Lal Traders both
preferred appeals before the Commissioner of Central Excise
(Appeals). The appeals were allowed by following the
decision of a larger Bench of the Tribunal in Jyoti
Overseas Limited Vs. CCE, Indore, reported in 2001
(130) ELT 446 which overruled the decision in Simplex
(supra) and held that cotton fabrics which were not ’made
up’ were correctly classifiable under Chapter 52 and not TH
59.09 (subsequently numbered as 5911.09). The Tribunal
dismissed the appellant’s appeal on the same ground.
The decision in Jyoti Overseas Limited (supra) has
been approved by this Court in our judgment dated 1st
March, 2005 in C.A. Nos. 2816-2818/2002, Commissioner
of Central Excise, Nagpur Vs. M/s. Simplex Mills Co.
Ltd. We therefore hold that the goods manufactured by the
respondent were classifiable under Chapter 52 and not
under Chapter 5911.90 as contended by the Revenue. The
appeals are accordingly dismissed.