2004 (96) ECC 444 (Tri)

CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL

West Zonal Bench -- Mumbai

Ms. Jyoti Balasundaram, Member (J) and Shri C. Satapathy, Member (T)

Charotar Tobacco Co. & Patel C.B. & Sons.

Versus

Commissioner of Central Excise, Mumbai

Appeals No. E/4144/98 & E/4145/98-MUM

[Arising out of Ord-in-App. No. YG/612/MII/98 dt. 4.9.98 passed by CCE (A), Mumbai.]

Order No. A/735 & 736/WZB/2004/C-I dated 12.5.2004,
Certified on 4.6.2004

Classification/Limitation

Branded Tobacco sold by the appellants in new packets. The Commissioner has come to a conclusion that scribings and symbols such as "Ronak Chap" and "Shop No. 4"/"Shop No. 5" in circle appearing on the packets have been used in relation to the impugned goods and have been admitted to be identifying the goods of the appellants. Regarding limitation both the appellants informed the Department that they had stopped printing brand name on the packets w.e.f. 16.3.1995 and further that they would not put any brand on their product in future. But it was found during visits in February 1996 that they had not adhered to their undertaking and that they were using brand names on the packets.

Held, the Commissioner (Appeals) has passed a correct order in regard to classification of the impugned goods as also on the question of limitation.

Appeals are dismissed

PRESENT :

Shri K.K. Shroff, Adv. for the appellants.

Shri S.V. Parelkar, JDR for the respondent.

Per : C. Satapathy

Heard both sides and perused the case records including cited case laws. The issue involved in these two appeals is whether the impugned Tobacco sold by the appellants in new packets would be classified as branded Tobacco. We find that the Commissioner (Appeals) has adequately dealt with various issues raised by the appellants in the impugned order, in which he has observed as follows:

I have carefully considered the record. I find that branded unmanufactured tobacco was seized from both the party's on 16.3.95. They are also asked vide department's letter dt. 16.3.95 to get themselves registered and to pay duty. Both appellants vide their letters dt 27.3.95 informed the department that they had stopped printing any brand name on the packets since 16.3.95 and that they would not put any brand, in future, and hence they were not liable to pay C. Ex. Duty. Vide the same letters they had also sought for permission to remove the seized tobacco without payment of duty, by repacking in plastic bags without any brand name. The department vide letters dt. 28.3.95 had rejected the request to clear tobacco, they had in stock on 16.3.95, in plastic bags without any brand name. I find that the appellants did not pay duty on the basis of their declaration in respective letters dt. 27th March 1995 that they had stopped putting any brand on the packets since 16.3.95.

It is, further, observed that on intelligence the jurisdictional C. Ex. Officers visited the shops of both the appellants on 5.2.96 and seized branded unmanufactured tobacco. The investigation revealed that both the appellants had been putting the symbol "Shop No. 4" or "Shop No. 5" in circle, on all the packets although they had declared vide their letter dt. 27th March 1995 that they had stopped putting, any brand on the packets. Both the appellant's representative in their statements recorded before C. Ex. Officers admitted that the said symbols were put so also to identify the appellants. I also find that the packets containing unmanufactured tobacco bear several details besides name and address of the appellants, though the wording of the symbol is the number of the shop, it is so printed that it amounts to a symbol. Other scribings printed on the packets viz "Patel Cb & Sons", "Ronak Chap" and the said symbols "Shop No. 4" or "Shop No. 5" in circle, are in addition to name and address of the appellants. The said symbol having been used in relation to the goods and having been admitted for identifying the goods as of the appellants, the Addl. Commissioner was justified in holding the goods as brand in them of Note 1 to Chapter 24 of C. Ex. Tariff. Commr. (A)'s Order No. 95/64 & 62/SRI/97 dt. 7.4.97 dealt with goods affixed with generic name "Pandharpuri" and facts of this case are quite different.

It is thus observed that both the appellants removed branded unmanufactured tobacco, that they had misdeclared to the department vide their letter dt. 27.3.95 that they had stopped putting any brand on the packets since 16.3.95. I do not find any force in appellants contention that putting such symbols did not amount to branding. The appellants vide their letters dated 27.3.95 declared to the department that they had removed the symbols on their packets allegedly amounting to branding and that since 16.3.95, they had stopped putting any brand on the goods and also that, in future, they would not be putting any brand. In fact, however, they stopped using one of the markings on the packets while they continued using other symbols, in question, even after 16.3.95. This came to be detected on 5.2.96 on the officers visit to their shop on the basis of specific intelligence. The appellants, thus, had deliberately attempted to escape from payment of duty and the Addl. Commr. is right in invoking the extraordinary provisions of Section 11A. The case-law cited by the appellants on the issue of limitation is of no avail to them. The contention on behalf of M/s. Patel CB & Sons that there was no suppression or that demand dt. 1.8.96 was, thus, time barred is also not acceptable to me for the reasons recorded herein above.

2. We find that the Commissioner has come to a conclusion that scribings and symbols such as "Ronak Chap" and "Shop No. 4"/"Shop No. 5" in circle appearing on the packets have been used in relation to the impugned goods and have been admitted to be identifying t7he goods of the appellants. As such, he has come to a conclusion that the impugned goods are classifiable as branded tobacco.

3. We also find that the appellants were asked in March 1995 to get themselves registered and pay duty on branded tobacco. However, both the appellants informed the Department that they had stopped printing brand name on the packets w.e.f. 16.3.1995 and further that they would not put any brand on their product in future. However, it was found during visits in February 1996 that they had not adhered to their undertaking and that they were using brand names on the packets. As such, the Commissioner has come to a conclusion that extended time limit is applicable in respect of the demand of duty against the appellants.

4. We are of the view that the Commissioner (Appeals) has passed a correct order in regard to classification of the impugned goods as also on the question of limitation. We are also of the view that the appellants have not made out a case requiring interference with the impugned order. Hence, we dismiss the appeals.

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