PEARLS OF BEAUTY Vs. CCE

JUDGEMENT

(1.) VIDE the impugned order the Commissioner of Central Excise classified Henna Powder in unit packings for use on Hair, manufactured by the Applicants herein, under C.E.T.A. sub -Heading 3305.90 for the years 1994 -95 and 1995 -96 and under Central Excise Tariff Act sub -Heading 3305.99 for the year 1996 -97, confirmed the duty demand of Rs. 33,83,172/ - on the above goods cleared during the period from 1.4.1994 to 22.7.1996 under the proviso to Section 11A of the Central Excise Act read with Rule 9(2) of the Central Excise Rules, and has imposed penalty equal to duty under Rule 173Q read with Section 11AC.

(2.) Arguing on the stay application, Ld. Counsel Shri L.P. Asthana, contends that the entire demand is barred by limitation since the classification lists/declarations filed during the relevant period, describing the goods as Henna Powder classifiable under chapter Heading 3203.00 of the Central Excise Tariff Act 1985 were approved by extending the benefit of exemption under Notification No. 27/90 -CX dt. 20.3.1990; and therefore the charge of suppression, misstatement is not sustainable so as to make available to the department, the extended period of limitation. He also pleads financial hardship on the ground that the current liabilities of Applicants company are in excess of its current assets, as seen from the relevant balance sheet. The Applicants also contends that proviso of Section 11AC are not applicable herein, because the entire period of demand is prior to the introduction of this section in the Central Excise Act; and that imposition of consolidated penalty under Section 11AC and Rule 173 of the Rule is not legally permissible. In these circumstances, the Applicants pray for waiver of pre -deposit and stay of recovery of duty and penalty pending disposal of the Appeal.

(3.) THE prayer is opposed by the Ld. D.R. who drew our attention to para 28 of the impugned order wherein the Commissioner has dealt with plea of time bar and held that the assessees deliberately concealed the full description of the goods in the classification lists/declarations with intention and sole motive of evading duty. Regarding the plea of financial hardship, he has no comments to offer.