Commr. of Cen. Exc. Ahmedabad v. M/S Urmin Products P. Ltd. and Others

Supreme Court of India · 2023 INSC 951 · 2023

Coram: S. RAVINDRA BHAT, ARAVIND KUMAR

JUDGMENT ARAVIND KUMAR, J. 1. Delay condoned on 23.08.2023. 2. These appeals are divided into seven (7) groups for convenience, and facts of each group are enumerated under the respective groups whereunder questions or points for determination have been formulated and anal ysed thereunder. For the purpose of convenience, the details of the judgment with reference to each group and details thereof are enumerated hereinbelow in the following table no. 1: TABLE 1 GROUP NUMBER. CONTENT – DETAILS PAGE NUMBER FROM TO 1. Commissioner Of Central Excise Ahmedabad v. M/S Urmin Products and Ors. [ C. A. No. 10159 – 10161 of 2010] i. Brief Facts 17 20 ii. Submissions of Parties 20 29 iii. Discussion and Finding 29 49 COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS 2. Commissioner Of Central Excise, Chandigarh v. M/S. Flakes-N-Flavourz [ C. A. 5146 of 2015] i. Brief Facts 50 51 ii. Submissions of Parties 51 55 iii. Discussion and Findings 56 72 3. Commissioner Of Central Goods and Service Tax Excise and Customs Bhopal v. Kaipan Masala Pvt. Ltd. [ Diary No. 44912 of 2019; Diary No. 6888 of 2020] i. Brief Facts 73 78 ii. Submissions of Parties 78 81 iii. Discussion and Findings 81 86 4. M/S Dharampal Premchand Ltd. V . Commissioner of Central Excise [ C.A. No. 2469 of 2020 along with Diary No. (s) 3492, 3487, 2810, 3484, 3513, 3536, 3544, 3545, 3547 of 2020.] i. Brief Facts 86 90 ii. Submissions of Parties 90 94 iii. Discussion and Findings 95 116 5. Commissioner of Central Goods and Service Tax v. M/S Tej Ram Dharam Paul [C.A. No. 3596 of 2023] i. Brief Facts 116 119 ii. Submissions of Parties 119 121 iii. Discussion and Findings 121 125 6. Commissioner Of Central Excise and Service Tax Meer ut V . M/S Som Pan Products Pvt. Ltd. [D.No.14581 of 2019] i. Brief Facts 126 127 ii. Submissions of Parties 127 129 iii. Discussion and Findings 129 130 7. Commissioner of Central Excise & ST Alwar v. Tara Chand Naresh Chand [C.A. No.959 of 2019] i. Brief Facts 131 133 ii. Submissions of Parties 133 137 iii. Discuss and Findings 137 142 ORDER Page 143-144 581 3. On behalf of the Revenue in the various groups of matters before this Court, we have heard: - (1) Mr. N. Venkataraman, learned Additional Solicitor General of India, (2) Ms. Nisha Bagchi, learned standing counsel. 4. On behalf of the assessee, we have heard: - (1) Mr. S.K. Bagar ia and Mr. Vivek Kohli, learned Senior Counsel, (2) Mr. A.R. Madhav Rao, Mr. Rupesh Kumar and Ms. Seema Jain, learned counsel. 5. The Appellants in Group No. (s) 1,2,3,5,6 and 7, and the Respondents in Group No.4, namely the ‘Commissioner of Central Excise’ are hereinafter referred to as “Revenue” . The Appellants in Group No.4 and the respective respondents in Group No. (s) 1,2,3,5,6 and 7, are hereinafter referred to as “Assessee” for the sake of convenience and brevity. 6. For ease of reference, the following table no. 2 of nomenclatures/ abbreviations is made available below. TABLE 2 Sr. No. Nomenclature/ Abbreviation Particulars / Meaning 1. “BIS” Bureau of Indian Standards 2. “CBIC” Central Board of Indirect Taxes and Customs 3. “CETA” Central Excise Tariﬀ Act, 1985 4. “CE ACT’ Central Excise Act, 1944 5. “CET SH” Central Excise Tariﬀ Sub-Heading 6. “CESTAT” Customs, Excise and Service Tax Appellate Tribunal 7. “CTPM” Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010 8. “CRCL” Central Revenue Control Laboratory 9. “OIA” Order-In-Appeal 10. “OIO” Order-In-Original 11. “CT” Chewing Tobacco 12. “ZST” Zarda/Jarda Scented Tobacco COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 7. The learned advocates appearing for the parties have placed reliance and referred to various statutory provisions, relevant chapters of CE A ct, CETA, CE Rules, CTPM Rules, and various relevant notiﬁ cations/circulars issued from time to time by the respective departments/ministry. For clarity and ease of reference we have catalogued the same herein in tabl e no.3 below: TABLE 3 I. TARIFF AND NOTIFICATIONS RELATING TO THE PERIOD 2005-2006 ISSUED UNDER CE ACT 1. Chapter 24 of the Central Excise Tariﬀ in 2004-05 (6 Digit Code). 2. Notiﬁ cation No. 13/2002 – CE (NT) dated 01.03.2002 under Section 4A prescribing abatement from MRP for arriving at assessable value. 3. Notiﬁ cation 10/2003 – CE (NT) dated 01.03.2003 under Section 4A prescribing abatement of 50% for all goods under 2404.41. 4. Chapter 24 of the Central Excise Tariﬀ in 2005-06 (8 Digit Code) 5. Circular 808/05/2005- CX dated 25.02.2005 in regard to introduction of 8-digit tariﬀ from 6-digit tariﬀ in vogue earlier. 6. Notiﬁ cation 2/2006 – CE (NT) dated 01.03.2006 under Section 4A. 7. Notiﬁ cation 16/2006 – CE (NT) dated 11.07.2006 under Section 4A. II. TARIFF AND NOTIFICATIONS BETWEEN THE YEARS 2010-2015 ISSUED UNDER THE CE ACT 1. Notiﬁ cation: 10/2010- C.E. (N.T.) dated 27-Feb-20 10 notifying Unmanufactured Tobacco and Chewing Tobacco under Section 3A. 2. Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rul es, 2010 Notiﬁ cation: 11/2010-C.E. (N.T.) dated 27-Feb-2010 583 3. Notiﬁ cation: 16/2010 – CE. Dated 27.02.2010 prescribing rate for branded unmanufactured tobacco and chewing tobacco. 4. Notiﬁ cation: 16/2010 – CE. Dated 27.02.2010 prescribing rate for branded unmanufactured tobacco and chewing tobacco. 5. Notiﬁ cation: 17/2010 – CE (NT) dated 13.04.2010- Notiﬁ es Jarda scented tobacco under Section 3A. 6. Notiﬁ cation 18/2010 – CE (NT) dated 13.04.2010 – Prescribi ng the capacity deemed to have been produced for chewing tobacco (including Filter Khaini), Unmanufactured Tobacco and Jarda Scented Tobacco. 7. Notiﬁ cation: 19/2010- C.E. dated 13.04.2010 – prescribing the rate for Chewing Tobacco, Unmanufactured Tobacco and Filter Khaini. 8. Notiﬁ cation: 14/2012 – CE Dated 14.03.2012 prescribing the new rate for Chewing Tobacco, Unmanufactured Tobacco and Filter Khaini. 9. Notiﬁ cation: 2/2014 – C.E. dated 24.01.2014 – prescribing the new rate for Chewing Tobacco, Unmanufactured Tobacco an d Filter Khaini. 10. Notiﬁ cation: 17/2014 – C.E. dated 11.07.2014 – Prescribing the new rate for chewing tobacco, unmanufactured tobacco and ﬁ lter khaini. 8. It would be apt and appropriate to extract Section 11A as it stood in 1980, and as it stood after the amendment brought in 2000 and by Act 10 of 2000 (w.e.f. 17.11.1980) and subsequent substitution by Act 8 of 2011, as it would have a direct bearing on the various batch of appeals before us. They read as under: COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 1980 2000 2011 Section 11A. ! " ! # $ % Section 11A. & erroneously refunded, whether or not such non-levy or non-payment, short- levy or short payment or erroneous refund, as the case may be, was on the basis of any approval, acceptance or assessment relating to the rate of duty on or valuation of excisable goods under any other provisions of this Act or the rules made thereunder], a Central Excise Oﬃ cer may, within one year from the relevant date, serve notice on the person chargeable with the 2 Section 11. ' for any reason, other than the reason of fraud or collusion or any wilful misstatement or suppression of facts or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty,- (a) the Central Excise Oﬃ cer shall, within [two years] from the relevant date, serve notice on the person chargeable with the duty which has not been so levied or paid 1 Substituted by Act 10 of 2000, sec. 97(a), for “erroneously refunded” ( w.e.f. 17.11.1980) 2 Subs. By Act 8 of 2011 585 ' ! ( ) ) * * + + + # + duty which has not been levied or paid or which has been short- lev- ied or short- paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount speciﬁ ed in the notice: Provided that where any duty of exercise has not been levied or paid or has been short-levied or short- paid or erroneously refunded by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty, by such person or his agent, the provisions of this sub-section shall have eﬀ ect, as if for the words [one year], the words “ﬁ ve years” were substituted. Explanation. - Where the service of the notice is stayed by an order of a Court, the period of such stay " ! # , COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] shall be excluded in computing the aforesaid period of [one year] or ﬁ ve years, as the case may be. [(1A) When any duty of excise has not been levied or paid or has been short- levied or short paid or erroneously refunded, by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Act or the rules made thereunder with intent to evade payment of duty, by such person or his agent, to whom a notice is served under the proviso to sub-section (1) by the Central Excise Oﬃ cer, may pay duty in full or in part as may be accepted by him, and the interest payable thereon under section 11AB and penalty equal to twenty-ﬁ ve per cent of the duty speciﬁ ed in the notice or the duty so accepted by such person within thirty days of the receipt of the notice.] 587 9. The detailed discussion of the relevant provisions, rules, notiﬁ cations, and circulars and its applicability or otherwise, have been deliberated upon while analysing the facts under each of the group. A PRELUDE TO THE LIS 10. We deem it necessary to brieﬂ y state the history of classiﬁ cation of these two competing entries which have been the pivotal issue in all these groups of appeals before this Court, i.e., CET SH 2403 9910 (‘chewing tobacco’) and CET SH 2403 9930 (‘zarda/jarda scented tobacco’) 11. At the outset, it may be noticed that the expressions ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ are nowhere deﬁ ned under the CE ACT or CETA. CETA initially covered ‘tobacco’ in item No.9 to the schedule. Entry 9(II) was country tobacco and sub-clause (2) thereof read “if intended for sale as chewing tobacco, whether manufactured or merely cured.” In 1983, ‘tobacco’ was covered under Item 4 of the Schedule of the CE Act. The relevant entry being Entry 4 II (5) which covered ‘chewing tobacco’ . In 1985, the CETA was enacted and ‘Chewing tobacco’ was shown under Entry 4 II (4). The Finance Act,1987, inserted “CET SH 2404.39” with eﬀ ect from 01.03.1987. The heading included the following: “Chewing tobacco including preparations commonly known as Khara Masala, Kiwam, Dokta, Zarda, Sukha and Surti”. Thus, for the first time ‘Zarda’ was recognized separately as preparation. 12. In 1996-97, CET SH 2404.40 was reformulated to read “chewing tobacco and preparations containing chewing tobacco”. 13. In 2002, under Section 4A of the CE Act, Notiﬁ cation No. 13/2002 – CE (NT) dated 01.03.2002 was issued prescribing abatement as percentage of retail sale price. However, it is to be noticed that Notiﬁ cation No.13/2002 had not covered ‘Chewing Tobacco’ reﬂ ecting under the relevant Entry 2404.21, within its ambit of ‘notiﬁ ed goods’ for the purposes of availing beneﬁ ts under Section 4A. However, subsequently by Notiﬁ cation No.10/2003 – CE (NT) dated 01.03.2003 was issued introducing Entry 24A in Notiﬁ cation 13/2002 dated 1.03.2002, thereby covering all goods under entry 2404.41 within the ambit of ‘notiﬁ ed goods’ for the purposes of Section 4A of the CE Act. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 14. Prior to the introduction of the 8-digit tariﬀ classiﬁ cation, ‘chewing tobacco’ was reﬂ ected under Chapter 24, under speciﬁ c entry ‘2404.41’ of the six-digit Central Excise Tariﬀ classiﬁ cation. Subsequently the new 8-digit Central Excise Tariﬀ classiﬁ cation was introduced vide Circular 808/05/2005 -CX dated 25.02.2005, Chapter 24 of the Central Excise Tarriﬀ came to be amended and heading ‘2403’ was introduced which reads: “2403 – Other manufactured tobacco and manufactured tobacco substitutes; ‘Homogenised’ or ‘Reconstituted’ tobac co; Tobacco extracts and essences”. The Central Excise Tariﬀ Heading ‘2403’ included the following sub-headings: “ 2403 9910 chewing tobacco 2403 9920 preparations containing chewing tobacco. 2403 9930 zarda/jarda scented tobacco.” 15. On 01.03.2006, Notiﬁ cation No.2/2006 was issued, vide which Notiﬁ cation No.13/2002 dated 01.03.2002 was superseded. Thus, the list of products, with their respective chapter headings/sub-headings, which were to be covered under the assessment in terms of Section 4A of the CE Act, were notiﬁ ed in terms of the eight-digit tariﬀ classiﬁ cation. However, it is pertinent to note that said Notiﬁ cation No.2/2006 did not include ‘Jarda/ Zarda scented tobacco – CET SH 2403 9930’ within the scope of ‘notiﬁ ed goods’ under Section 4A of the CE Act, for availing the beneﬁ ts of abatement as percentage of retail sale price. 16. Subsequently, Notiﬁ cation No.16 of 2006 dated 11.07.2006 was issued, wherein CET SH 2403 9930 came to be included within Notiﬁ cation No.2/2006 dated 01.03.2006, thereby including ‘jarda/ zarda scented tobacco’ within the scope of ‘notiﬁ ed goods’ under Section 4A of CE Act. 17. It is relevant to note at this juncture, the period between 1.03.2006 and 11.07.2006, during which the beneﬁ ts of MRP-based assessment was not available to goods classiﬁ ed under CET SH 2403 9930 as ‘jarda/ zarda scented tobacco’ is the very same period of dispute which has to be adjudicated in the appeals in Group I ( Urmin Products ) and Group II ( Flakes-n-ﬂ avourz ). 589 18. In light of the evolution of classiﬁ cation of ‘chewing tobacco’ and ‘jarda/zarda scented tobacco’ having been discussed hereinabove, we proceed to address the issues/questions formulated within the various appeals before us. At the outset, it must be mentioned that the ﬁ ndings and conclusions arrived at will pertain to the issues formulated and adjudicated in light of the facts relevant to those groups, and hence, the ﬁ ndings are mutually exclusive to the facts of each group. I. COMMISSIONER OF CENTRAL EXCISE AHMEDABAD V . M/S URMIN PRODUCTS AND ORS. [ C. A. NO. 10159 – 10161 OF 2010] BRIEF FACTS 19. In these appeals, the Revenue has challenged the order dated 25.03.2010 passed by the jurisdictional CESTAT wher eunder the classiﬁ cation given by the assessee was accepted as “ﬂ avoured chewing tobacco” falling under CET SH 2403 9910 and not as ‘zarda/jarda scented tobacco’ falling under CET SH 2403 9930 of CETA. 20. The assessee came to be visited with a show cause notice dated 09.07.2007 stating thereunder that the assessee had been manufacturing and clearing the product manufactured by it as ‘zarda/jarda scented tobacco’ under the guise of ‘chewing tobacco.’ During the visit to the assessee’s factory by the Department’s oﬃ cers, they noticed the process of manufacturing ‘zarda/jarda scented tobacco.’ The statement of the production manager and also the statement of the factory in charge ca me to be recorded, based on which the Department concluded that there was a deliberate intention to evade payment of duty by misclassiﬁ cation and wilful misstatement of their product to enable them to pay lesser duty. Accordingly, by invoking the extended period of limitation as provided under proviso to Section 11A(1) CE Act, the Department called upon the assessee to show cause as to why the product which had been classiﬁ ed as ‘chewing tobacco’ should not be classiﬁ ed as ‘zarda/jarda scented tobacco’ and why the said product should not be accordingly assessed to duty as per Section 4 of the CE Act, for the period 01.03.2006 to 10.07.2006 . Further, the assessee was required to show cause as to why the penalty as a consequence of wi lful misclassiﬁ cation should not be recovered. The said show cause notice came to be adjudicated and the show cause notice including the demand ma de COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] thereunder, was upheld in OIO dated 28.01.2008. This OIO was challenged and an appeal came to be ﬁ led before the CESTAT which came to be allowed and the stand taken by the assessee was upheld by opining as under: “21. On the other hand, the department has not produced any evidence to show that the product is Tobacco Scented with Zarda. In fact , the learned SDR relied upon the process of manufacture in adjudication order. However, the process of manufacture given in the adjudication order in Para 2 is the manufacturing process as noticed by the oﬃ cers when they visited the factory premises. This is a ﬂ owchart prepared by the oﬃ cers after their visit. However, when we have a look at the statement of the Production Manager Shri Ramesh Narsi nghbhai Patel in the ﬂ ow chart, the Zarda Scented Tobacco in the proces s of manufacture is missing. Zarda Scented Tobacco ﬁ g ures in the manufacturing ﬂ ow chart given by Shri Dipak Suryakant Shah only. Further, it was also brought to our notice that dur ing the period from 19.01.05 to 20.08.05, the appellants had described the product in the classiﬁ cation list as Chewing Tobacco and from 1.3.05, to 31.3.06, it was classiﬁ ed as Zarda Scented Tobacco and from 1.4.06 onwards, the classiﬁ cation description was Chewing Tobacco which continues till today. In the invoice/bills prepared by the appell ant, the item was described as Zafrani Zarda and from 1.4.06, it is being called as Baghban Flavoured Chewing Tobacco. It is not the case of the department or the party that there was change in the lab el or manufacturing process. From the description in the label, it is quite clear that the product is called Flavoured Chewing Tobacco. No expert opinion or information from the trade have been obt ained and it is only the statement of factory manager that the product is usually eaten with Pan, Betel nut or Pan Masala etc. Department has come to the conclusion that the product is not Chewing Tobacco. Further, as submitted by the appellant, nowhere in the statem ent of the employees, it has been stated that Zarda Scent was added. Under these circumstances, in view of the above discussion, neither side has been able to show whether the product is Chewing Tobacco or Zarda Scented Tobacco clearly. Both sides have some points in their favour and some against them. Under these circumstances, in view of the fact that the label calls the product as Flavoured Chewing Tob acco, 591 no Zarda Scent has been used and the product has not been sold as Zarda Scented Tobacco by the appellant, we consider that the cla im of the appellant that the product is Flavoured Chewing Tobacco has to be accepted. Thus, on merit, the appellants succeed. Therefore, the demand for diﬀ erential duty fails and naturally the penalties imposed under Section 11AC of Central Excise Act or rules of Central Excise Rules, 2002 also have to be set aside.” 21. The issue of limitation was also held in favour of the assessee by opining as under: “22. In any case, we consider that the limitation would apply i n this case and show cause notice should not have been issued beyond one year in view of the fact that the appellant intimated their intention to change. Further, the appellant had also intimated that the p roposed change was not in line with industrial factory. Therefore, extended period also could not have been applied in this case.” 22. Hence these appeals. SUBMISSIONS OF THE PARTIES 23. We have heard Shri N. Venkataraman, learned Additional Solicitor General appearing for the Revenue, and Ms. Nisha Bagchi, appearing for the Revenue. 24. It is the contention of the Revenue that Notiﬁ cation No.2 of 2006 dated 01.03.2006 was issued in supersession of Notiﬁ cation No.13 of 2002 dated 01.03.2002 specifying thereunder that the goods covered under Section 4A of CE Act 1944 was for MRP-based assessment and it did not specify the goods falling under CET SH 2403 9930 that is ‘zarda/jarda scented tobacco’ , but it covers the goods falling under CET SH 2403 9910 that is ‘chewing tobacco’ . It was contended that as ‘zarda/jarda scented tobacco’ was not speciﬁ ed under MRP-based assessment under Section 4A, the goods have to be assessed under Section 4 of the CE Act. Shri Venkatarama n, Learned Additional Solicitor General and Shrimati Nisha Bagc hi have contended that the assessee changed and misclassiﬁ ed the produc t from ‘zarda/jarda scented tobacco’ i.e., CET SH 2403 9930 to ‘chewing tobacco’ i.e., CET SH 2403 9910 with an intention to evade payment of duty under Section 4 of the CE Act, 1944 despite there being no change in the nature COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] of the products. It is contended that the assessee despite being aware of the fact that their product was not covered under relevant notiﬁ cation which provides for valuation under Section 4A of CE Act, had continued to avail the beneﬁ t of Section 4A of CE Act till 11.07.2006. It is contended by the Revenue, that abatement provided to the goods classiﬁ able under CET SH 2403 9910 i.e., ‘chewing tobacco’ was 50 percent, therefore if the goods are cleared as ‘chewing tobacco’ the duty has to be paid on lower value, resulting in payment of such amount of duty as the value determined under Section 4A of CE Act, after 50 percent abatement, which was much l ess as compared to transaction value under Section 4 of CE Act. It is further contended by the Revenue that ‘zarda/jarda scented tobacco’ was brought into the ambit of Section 4A of CE Act, by amendment to Notiﬁ c ation No.16 dated 11.07.2006 and thus the product ‘zarda/jarda scented tobacco’ was not speciﬁ ed for assessment under Section 4A of the CE Act, for the period 01.03.2006 to 10.07.2006. Hence, the Revenue sought to justify the demand of duty short paid by the assessee by invoking the proviso under Section 11A (1), along with interest, at the appropriate rate under Section 11AB of the Act 1944. 25. The learned Senior counsel for the Revenue would further elaborate his submissions by contending that the assessee has not shown any proof of record for concluding that ‘zarda/jarda scented tobacco’ is also ‘chewing tobacco’ . By contending that this tariﬀ classiﬁ cation was in force during the period of the board’s letter dated 23.06.1987, notice dated 15.07.1987, and the notiﬁ cation dated 16.03.1995 and as such they would not come to the rescue of the assessee. It is also urged that the tariﬀ has been aligned to 8 digits and more speciﬁ cally calculation has been provided where ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ have been separately classiﬁ ed and as such the contention of the assessee has no legs to stand. 26. The Revenue would further contend that the assessee is selling its product as “zafrani zarda” and as such it cannot claim ‘zarda/jarda’ used in the tariﬀ heading is diﬀ erent from ‘zarda/jarda’ used by assessee and further, the assessee has not been able to demonstrate how i ts product is diﬀ erent from ‘zarda/jarda scented tobacco’ mentioned in the tariﬀ . The Revenue would also contend that once the product is sold as ‘zarda/jarda’ , which is speciﬁ cally covered under CET SH 2403 9930, it cannot claim that 593 the said product would fall CET SH 2403 9910 as ‘chewing tobacco’ . The Revenue has drawn the attention of this Court to the fact that assessee earlier classiﬁ ed the product as ‘zarda/jarda scented tobacco’ , and there being no change in classiﬁ cation of the product, to pay duty at lesser value would be without any justiﬁ cation. They would also contend that the tribunal has committed a serious error in ignoring the statement of the persons who were in charge of the factory and the statement of the factory manager which was relied upon by the department to substantiate as to how the a ssessee had been manufacturing the product, and the process, and there being no change in the manufacturing process, or any new plant and machinery having been installed in their unit. The standing counsel for the Revenue, would a lso contend that during 2005-06 the assessee themselves described the product as ‘zarda/jarda scented tobacco’ and suddenly from April 06, 2006, started describing their product as ‘chewing tobacco’ classiﬁ able under CET SH 2403 9910 to avail the beneﬁ t of Notiﬁ cation No.2 of 2006 dated 01.03.2006. It was also contended that when two or more headings are a vailable, the product should be classiﬁ ed under the more speciﬁ c heading according to the description of the product and in the instant group it would fall u nder CET SH 2403 9930 as ‘zarda/jarda scented tobacco’ . 27. The Revenue also contended that tribunal in paragraph 21 of the impugned order having held that “both sides have some points in their favour and some against them” failed to elaborate or assign the reasons for extending the beneﬁ t of Section 4A to assessee and on this ground alone the impugned order is liable to be set aside. 28. The Revenue would also contend that tribunal co mmitted a serious error in concluding that show cause notice should have been issued within one year period as the assessee intimated their intention to change the classiﬁ cation and contended that the assessee has not mentioned any details of the products which they were manufacturing at that ma terial time but had only forwarded a cryptic communication, lacking details and bereft of material particulars, namely the intention of changing the heading and classiﬁ cation of the product which was being manufactured by them and no evidence for reasons of change was forthcoming from the sai d communication, and as such the assessee cannot take umbrage under the said communication to stave-oﬀ its liability or, to contend that extended period of limitation cannot be applied as the department knew about such change. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 29. The learned counsel appearing for the respondent – asseessee by supporting impugned order passed by the tribunal would contend that intention of the Revenue/Government was to levy duty on the product manufactured by the appellant-assessee under Section 4A of CE Act only. He would submit that the product manufactured by the assessee was classiﬁ ed under CET SH No.2404.41 as ‘chewing tobacco’ and duty was assessed under Section 4A of CE Act on MRP basis and accordingly duty was paid. He would contend that with introduction of the 8 (eight) digit tariﬀ era, assessee classiﬁ ed its product as ‘zarda/jarda scented tobacco’ under CET SH 2403 9930 for the period 01.03.2005 to 28.02.2006. At this juncture, he would hasten to add that in accordance with the policy on taxation on ‘tobacco production’ , the duty assessment regime remained constant i.e., under Section 4A of CE Act on MRP basis only. He would contend that Notiﬁ cation No.2 of 2006 dated 01.03.2006 which was issued superseding Notiﬁ cation No.13 of 2002 dated 01.03.2002 under the list of notiﬁ ed goods with the respective Chapter heading/sub-heading, would cover assessment in terms of Section 4A of the CE Act. Though notiﬁ ed, by oversight ‘zarda/ jarda scented tobacco’ under CET SH was omitted, he would contend that taxation of ‘tobacco products’ remains constant i.e., under Section 4A of CE Act on MRP basis. In this background he would contend that throughout the respondent-assessee has classiﬁ ed its product as ‘chewing tobacco’ with the knowledge and acceptance of the Department. 30. He would also contend that the extended period of limitation could not have been invoked in the background of assessee having intimated the Department about the change in classiﬁ cation in advance and there was no suppression of fact or mis-declaration. 31. He would also contend that assessment under Section 4 of the CE Act in terms of the transaction value of the product, the price charged and recovered by the assessee would necessarily have to be treated as cum- duty-price and assessment ought to be done and when such an exercise is undertaken the diﬀ erential duty would be insigniﬁ cant. 32. He would contend that the product manufactured by the assessee is only ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ , which expressions are not deﬁ ned under the Act and no explanation is provided on what products could possibly have been covered under the heading ‘zarda/ 595 jarda scented tobacco’ , or what is the scope of that heading. In that view of the matter, he would contend that the ‘Common Trade Parlance Test’ as has been enunciated by this Court will have to be applied and tested. He would also further contend that classiﬁ cation is a question relating to chargeability and, therefore, the burden of proof lies on the Department, for whi ch no evidence whatsoever has been adduced by the Department to justify the change. It is his submission that any change in the classiﬁ cation has to be based on something more than just change in tariﬀ entry. Even otherwise, if classiﬁ cation is possible under two entries, the one more beneﬁ cial to the assessee would be adopted. Hence, relying upon the following judgments he prays for dismissal of the appeal ﬁ led by the Revenue: 1. HPL Chemical Ltd. v. CCE 2006 197 ELT Chandigarh 324 (SC) 2. Mauri Yeast India Pvt. Ltd. v. State of U.P. (2008) 5 SCC 680 3.C.G. & S.T. CCE and ST Rohtak v. Som Flavours Masala Pvt. Ltd. - Civil Appeal No.1251 of 2023 disposed of on 17.02.2023. 4. Commissioner of Central Excise, Nagpur v. Shree B aidyanath Ayurved Bhawan Ltd. (2009) 12 SCC 419. ISSUES/QUESTIONS FOR CONSIDERATION 33. Questions that arise for our consideration in this group are as under: Q.1 Whether the authorities below were correct and just iﬁ ed in invoking the proviso to Section 11A of the CE Act? Q.2 Whether the product manufactured and cleared by the assessee for the period 01.03.2006 to 10.07.2006 was required to be classiﬁ ed under the CET SH 2403 9910 as ‘chewing tobacco’ or to be classiﬁ ed under CET SH 2403 9930 as ‘zarda/jarda scented tobacco’ ? DISCUSSION AND FINDINGS BACKGROUND 34. The assessee herein was availing the beneﬁ t of the Notiﬁ cation No. 13 of 2002 dated 01.03.2002, issued in exercise of the power under Section 4A of CE Act, whereunder the goods/products were chargeable to a duty of excise with reference to value, notwith standing anything COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] contained in Section 4 of CE Act, to be deemed to b e the retail sale price declared on such goods, else such amount of a batement, if any, from such retail sale price by classifying the product manufactured as ‘chewing tobacco’. 35. Undisputedly, the assessee was availing the ben efit of Notiﬁ cation No.13 of 2002 dated 01.03.2002 and adopti ng MRP-based assessment. Even after the introduction of 8-digit tariﬀ classiﬁ cation ( w.e.f. 28.02.2005 ), the assessee was availing the same beneﬁ t. However, in the teeth of two classifications made under Noti fication dated 24.02.2005, re-organizing the CET SH 2403 9910 as ‘chewing tobacco’ and CET SH 2403 9930 as ‘zarda/jarda scented tobacco’ , which attracted duty of 34% on both the products at the time, the a ssessee classiﬁ ed or re-classiﬁ ed the product manufactured and hithe rto declared as ‘chewing tobacco’ to ‘zarda/jarda scented tobacco’ . Notiﬁ cation No.2 of 2006 dated 01.03.2006 issued in supersession of Notiﬁ cation No.13 of 2002 excluded ‘zarda/jarda scented tobacco’ and did not specify CET SH 2403 9930 for MRP-based assessment, or in ot her words did not include or did not specify ‘zarda/jarda scented tobacco’ for MRP- based assessment. Hence, the assessee started class ifying the product manufactured as ‘chewing tobacco’ though he had declared earlier as ‘zarda/jarda scented tobacco’ . Thus, by virtue of such deletion/omission in light of Notiﬁ cation No.13 of 2002, the assessm ent was required to be made under Section 4 which provides for the valu ation of excisable goods for purposes of charging of duty of excise. In other words, the beneﬁ ts that were ﬂ owing from the operation of Section 4A having been excluded by virtue of the Notiﬁ cation dated 0 1.03.2006, the assessee reverted to ‘chewing tobacco’ to avail the beneﬁ t of Section 4A. In the light of the analysis of these notiﬁ cations vis-à-vis the statutory provisions of the levy of duty or chargeability, it would not detain us for long to answer the questions formulated hereina bove. RE: Q. No. 1 Issue of Limitation/ Section 11A of th e CE Act: 36. In the instant case i.e., Civil Appeal Nos.1015 9-10161 of 2010 - CCE Ahmedabad vs. M/s Urmin Products Pvt. Ltd. the show cause notice came to be issued on 09.07.2007 and the OIO came to b e passed on 28.01.2008 which resulted in the impugned order date d 25.03.2010. 597 37. The tribunal by the impugned order has held to the following eﬀ ect: “22. In any case, we consider that the limitation would apply in this case and show cause notice should not have been issued beyond one year in view of the fact that the appellant intimated their intention to change. Further, the appellant had also intimated that the proposed change was not in line with the industrial factory. Therefore, the extended period also could not have been applied in this case.” 38. It would be apt to note at this juncture itself that the judgment of this Court in CCE Vs. Cotspun (1999) 7 SCC 633, whereunder, it came to be held that levy of excise duty based on an approved classiﬁ cation list is not a short levy and diﬀ erential duty cannot be recovered on the ground that it is a short levy. It was further held that levy of excise duty based on an approved classiﬁ cation list is the correct levy, at least until the correctness of the approval is questioned by the issuance of a show cause notice to the assessee. It is only when the correctness of the approval is challenged that an approved classiﬁ cation list ceases to be such. It was further held: “14. The levy of excise duty on the basis of an approved classiﬁ cation list is the correct levy, at least until such time as to the correctness of the approval is questioned by the issuance to the assessee of a show-cause notice. It is only when the correctness of the approval is challe nged that an approved classiﬁ cation list ceases to be such. 15. The levy of excise duty on the basis of an approved classiﬁ cation list is not a short levy. Diﬀ erential duty cannot be recovered on the ground that it is a short levy. Rule 10 has then no application. 16. We are, therefore, of the opinion that the judgment in Ballarpur Industries which did not advert to Rule 173-B, does not lay down the law correctly and it is overruled. The decision in Rainbow Industries, on the other hand, correctly lays down the law. It was delivered in the context of Rule 173-C dealing with approved price lists and th e provisions of Rules 173-C and 173-B are analogous.” 39. However, the said ﬁ nding in Cotspun’s case would not merit acceptance for the simple reason that the amendment to Secti on 11A of COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] CE Act, brought by Act 10 of 2000, would clearly take within its sweep , that even if there is non-levy or non-payment, short levy or short payment, or erroneous refund, as the case may be, on the basis of any approval, acceptance or assessment relating to the rate of duty or on valuati on of excisable goods under any other provisions of the CE Act or the rules made thereunder, the Central Excise Oﬃ cer can, within one year from the relevant date, serve a notice on the person chargeable with duty which has not been levied or unpaid or which has been short levied or short paid or to whom the refund has been erroneously been made, requiring him to show cause why he should not pay the amount speciﬁ ed in the notice. 40. Notification No.2 of 2006 dated 01.03.2006 was issued in supersession of Notiﬁ cation No.13 of 2002 dated 01.03.2002 specifying thereunder the goods covered under Section 4A of Act 1944 for MRP- based assessment. It was noticed that the notiﬁ cation did not specify the goods falling under CET SH 2403 9930 ( ‘zarda/jarda scented tobacco’ ) but covered the goods falling under CET SH 2403 9910 ( ‘chewing tobacco’ ). Since the ‘zarda/jarda scented tobacco’ was not speciﬁ ed under MRP-based assessment under Section 4A of CE Act, the goods had to be assessed under Section 4 of the CE Act. The abatement provided to the goods cl assiﬁ ed under CET SH 2403 9910 was 50 percent. Hence, if the goods are cleared as ‘chewing tobacco’ the duty has to be paid on lower value res ulting in payment of a lesser amount of duty, as the value determined under Section 4A after 50 percent abatement was much lesser compa red to transactional value under Section 4 of CE Act. It is for this precise reason the assessee changed the classiﬁ cation from ‘zarda/jarda scented tobacco’ to ‘chewing tobacco’ . ‘Zarda/jarda scented tobacco’ was brought into the ambit of Section 4A of the CE Act (MRP-based assessm ent), by virtue of amendment to Notiﬁ cation No.2 of 2006 vide Notiﬁ cation No.16 of 2006 dated 11.07.2006. In other words, ‘zarda/jarda scented tobacco’ was not speciﬁ ed for assessment under Section 4A of CE Act for the period 01.03.2006 to 10.07.2006 . In the light of the aforesaid discussion, we are of the considered view the contention of the assessee cannot be acce pted and the Revenue was correct and justiﬁ ed in issuing the show cause notice. 41. One of the contentions raised by the assessee throughout has been that they had ﬁ led a letter on 30.03.2006 clearly showing the change in the 599 classiﬁ cation by the assessee and the reasons for the change were shown in the statement as well as their letter dated 25.06.2007 and there was no suppression. In fact, the adjudicating authority has extracted the contents of the letter dated 30.03.2006 in paragraph 13.1 of the OIO dated 28.01.2008. However, for immediate reference and at the cost of repetition it is extracted herein below: “This is to inform you that as per the practice followed by our industry, we classiﬁ ed our product; chewing tobacco into CETSH 2403 9910.” 42. It is an admitted fact that till the ﬁ ling of this letter, the assessee continued to classify the product as ‘zarda/jarda scented tobacco’ falling under CET SH 2403 9930. It is for this precise reason, that the adjudicating authority has observed, and rightly so that the letter dated 30.03.2006 had been cleverly drafted and it does not mention in detail the product which they were manufacturing at that material time namely ‘zarda/jarda scented tobacco’ . Though the classiﬁ cation in the letter shows entry CET SH 2403 9910 ( ‘chewing tobacco’ ), it would depict a picture as though it is a new product. A plain reading of the letter would not indicate that the author of the said letter intended to reveal any details about the product that is being manufactured. However, the assessee cannot feign ignorance as to the necessity of furnishing such relevant details necessary for determination of payment of duty. The assessee having been in this industry for a long period was well aware of this statutory requirement. Upon a deeper e xamination of the said letter, the suppression becomes more apparent, namely the non- mentioning of change of the name and classiﬁ cation of the goods which they were currently manufacturing and which they ought to have disclosed. It would be apposite to note the judgment of this court in Continental Foundation Jt. Venture v. Commissioner of Central Excise (2007) 10 SCC 337 that suppression means failure to disclose full information with intent to evade payment of duty. It has been further held: “12. The expression “suppression” has been used in the proviso to Section 11A of the Act accompanied by very strong words as ‘fraud’ or “collusion” and, therefore, has to be construed strictly. Mere omission to give correct information is not suppression of facts unless it was deliberate to stop the payment of duty. Suppression means failure to disclose full information with the intent to evade payment of duty. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] When the facts are known to both the parties, omission by one party to do what he might have done would not render it suppression. When the revenue invokes the extended period of limitation under Section 11A the burden is cast upon it to prove suppression of fact. An incorrect statement cannot be equated with a wilful misstatement. The lat ter implies making of an incorrect statement with the knowledge that the statement was not correct. 14. As far as fraud and collusion are concerned, it is evident that the intent to evade duty is built into these very words. S o far as misstatement or suppression of facts are concerned, they are cle arly qualiﬁ ed by the word ‘wilful’, preceding the words “ misstatement or suppression of facts” which means with intent to evade duty. The next set of words ‘contravention of any of the provisions of this Act or Rules’ are again qualiﬁ ed by the immediately following words ‘with intent to evade payment of duty.’ Therefore, there cannot be suppression or misstatement of fact, which is not wilful and ye t constitute a permissible ground for the purpose of the proviso to Section 11A. Misstatement of fact must be wilful.” It is this hiding of the fact and not specifying the details in their letter that led to the issuance of the show cause notice and invocation of Section 11A and Section 11 AC of the CE Act, by the Department. It cannot b e ignored that till ﬁ ling of the letter dated 30.03.2006, the assessee itself was classifying the product as ‘zarda/jarda scented tobacco’ falling under CET SH 2403 9930 and being a large-scale manufacturer and paying large sums of amount as duty, to contend that it was unaware of the diﬀ erence between these two products, or to contend that it had classiﬁ ed the product as ‘zarda/ jarda scented tobacco’ by ignorance, is not a plausible justiﬁ cation on part of the assessee. However, on the issuance of Notiﬁ cation No.2 of 2006 dated 01.03.2006 under which ‘zarda/jarda scented tobacco’ was excluded or in other words not included in the said notiﬁ cation, the assessee changed the description of its product from ‘zarda/jarda scented tobacco’ to ‘chewing tobacco’ . The date of communication of the letter dated 30.03.2006 by the assessee also acquires signiﬁ cance in as much as the Notiﬁ cation No.2 of 2006 dated 01.03.2006 were to take eﬀ ect from 01.04.2006 and just two days before the date of the said Notiﬁ cation No.2 of 2006 coming into eﬀ ect, this 601 communication dated 30.03.2006 has been forwarded to the Department by the assessee. The intention of springing up such a letter is evident from the fact that intention was to evade payment of duty payable under Se ction 4 of CE Act; despite knowing the fact that its product was not covered under relevant notiﬁ cation which provides for valuation under Section 4A, yet the assessee did so, only to pay duty on lower value as per Sec tion 4A of CE Act, by claiming the product manufactured by it as ‘chewing tobacco’ rather than ‘zarda/jarda scented tobacco’ to avail beneﬁ t of MRP-based assessment which was lower than the value as prescribed under Section 4 of the CE Act. 43. Yet another factor which cannot go unnoticed is the statement of the production manager and factory in-charge and manager recorded at the time of the inspection of the units/factory of the assessee, whereunder they have clearly admitted in their statement dated 21.06.2007 recorded under Section 14 of the CE Act, wherein they conﬁ rmed that in the E.R. 1 returns ﬁ led for the month of April 2006 onwards, they have revised the classiﬁ cation of their ﬁ nal product from CET SH 2403 9930 to CET SH 2403 9910 and started describing their product as ‘chewing tobacco’ instead of ‘zarda/jarda scented tobacco’ and by virtue of such declaration they continued to pay duty as per MRP-based assessment under the relevant Notiﬁ cation No.2 of 2006 dated 01.03.2006 though ‘zarda/jarda scented tobacco’ was not covered under MRP-based assessment during the period 01.03.2006 to 10.07.2006 till the tariﬀ entry i.e., CET SH 2403 9930 being brought within the ambit of Section 4A of CE Act by issuance of Notiﬁ cation 16 of 2006 dated 11.07.2006. It is for this precise reason that the act of the assessee was held to be a deliberate and accordingly wilful misstatement was alleged on part of the as sessee, with an intention to evade duty payable under Section 4 of the CE Act, which would attract the extended period of limitation, namely proviso to Section 11A (1) being invoked. The adjudicating authority has examined the issue of invoking an extended period of limitation, in the background of the communication dated 30.03.2006 which has been very heavily relied upon by the assessee to stave oﬀ the allegation of misrepresent ation or wilful misstatement of facts and the adjudicating authority opined as under: “It can be seen that the assessee had very cleverly drafted the letter and did not mention any details of the product which they were COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] manufacturing at that material time i.e.,’Jarda scented tobacco’ . On reading this letter, any person could conclude that they have starte d a new product ‘Chewing tobacco’ which they have cla ssiﬁ ed in 2403 9910 as it is the, correct subheading of Chewing tobacco. On a plain reading of the letter, at the ﬁ rst instance, no one will be able to understand the real motive. The assessee did not mention in the letter that they are changing the name and classiﬁ cation of the goods which are currently being manufactured by them which they were supposed to do. Had they mentioned this fact at that time, the issue would not have arisen at all. Intentionally, they have hidden the facts and did not elaborate in the letter. The assessee, on the contrary pre ferred to show the reasons in the statement recorded under Section 4 on 26-6- 2006 when the department caught him for evading the duty. Further, the assessee has mentioned that as per the practice followed by their industry, they classify their product Chewing tobacco into 2403 9910. The classiﬁ cation of the goods manufactured by an assessee is based on many factors including the raw material used, manufacturing process and the end use. If any of the deciding factors is changed then the classiﬁ cation may change and therefore the industry cannot decide the classiﬁ cation in such type of goods. The assessee intentionally hid the fact that they have changed the classiﬁ cation of their product viz. ‘Jarda scented tobacco’. It is an establish fact that when there is no dispute on classiﬁ cation and the assessee suddenly submits a very carefully drafted letter of such type, a general inference will be draw n that a new product has been introduced in place of earlier one. The assessee, with intent to evade the Central Excise duty, deliberately resorted to mis-statement and willfully suppressed the vital facts. The assessee had changed and misclassiﬁ ed the product from ‘Jarda scented tobacco’ to ‘Chewing tobacco’ with an intention to evade payment of duty payable under Section 4 of the Central Excise Act, 1944, despite knowing the fact that their product was not covered under the relevant Notiﬁ cation which provides for valuation under Section 4A. The assessee did so to enable them to pay duty on lower value [as the value as per Section 4A of Central Excise Act, 1944 (MRP based assessment) was lower than the value as per Section 4 of Central Excise Act, 1944. Thus, there was a deliberate intention to evade payment of duty by the assessee, 603 by misclassiﬁ cation and willful mis-statement of their product and due to this act, the department is entitled to invoke the extended period as provided in the proviso to Section 11A (1) of the Central Excise Act, 1944 to recover the diﬀ erential duty along with interest under section 11 AB for the larger period upto 5 years and has also rendered themselves liable to penalty under section 11 AC of the Central Excise Act 1944. I, accordingly hold that the assessee is liable to penalty under Section 11AC of the Central Excise Act, 1944.” However, the tribunal has proceeded to hold that limitation would apply and show cause notice should not have been issued beyond one year in view of the fact that the assessee intimated their intention to change – vide Paragraph 22 of the impugned order, without addressing the aforesaid issues which has been dealt in detail hereinabove. In other words, the tribunal by cryptic order has negatived the contentions of the Revenue and held tha t the invocation of the extended period of limitation was not warranted. This ﬁ nding, not being in consonance with the facts obtained on the hand, we are unable to subscribe our views to the judgment of the tribunal. In that view of the matter, we are of the considered view that Question No.1 is to be answered against the assessee and in favour of the Revenue and aﬃ rm the ﬁ nding of the adjudicating authority and reverse and/or set aside the ﬁ nding recorded by the tribunal which has been observed at the initial stage herein given that it is not only contrary to the facts but also contrary to law as noticed hereinabove. It is for these precise reasons the Adjudicating Authority was of the clear view that there has been a deliberate intention to avoid payment of duty by the assessee by misclassiﬁ cation and willful misstat ement of its product and hence it was justiﬁ ed in invoking the extended period as provided in the proviso to Section 11A(1) of CE Act, 1944. RE: Q.2 – WHETHER ASSESSEE’S CLASSIFICATION FOR THE PERIOD IN DISPUTE IS TO BE ACCEPTED? 44. In the instant case the principle of admission is the best proof that can be applied to conclude that the assessee itself h ad classiﬁ ed the product as ‘zarda/jarda scented tobacco’ based on the declaration in ER-I returns for April 2006 and onwards. On advent of 8-digit era under the CETA, ‘chewing tobacco’ was classiﬁ ed under CET SH 2403 9910, and ‘zarda/jarda scented tobacco’ came to be separately classiﬁ ed under CET COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] SH 2403 9930 from 01.03.2005 despite such classiﬁ cation, the notiﬁ cation issued in respect of goods to be assessed on the basis on MRP cont inued to show the tariﬀ heading and the goods covered under ‘chewing tobacco’ head as 2404.41. When Notiﬁ cation No.2 of 2006 dated 01.03.2006 came to be issued and it reﬂ ected under Serial No.28 that all goods classiﬁ ed under entry SH 2403 9910 to 2403 9920 were covered for MRP assessment and the product ‘zarda/jarda scented tobacco’ was not included under said entry, it necessarily meant that ‘zarda scented tobacco’ could not be determined under MRP assessment scheme. 45. The signatory to the ER – 1 returns ﬁ led by the assessee for the relevant period was Smt. Sheetal K Majithia, Director – Finance and she was the one who took the decision to change the classiﬁ cation of the product. Hence, she was issued with the summons for appearing and explaining the same. However, she chose to ignore the summons and has not appeared before the adjudicating authority. Whereas, the factory in-charge and manager, Shri Dipak S Shah, has appeared and has furnished the statement, whe reunder he admits that he reports to Smt. Sheetal K Majithia, D irector – Finance. He further admits in his statement dated 26.06.2007 and 09.07.2007, that their/assessee’s product is classiﬁ able as ‘jarda/zarda scented tobacco,’ they still continued to pay duty as per MRP-based assessment prescribed under Section 4A of the CE Act. He further admits at the material time 2005-06, the product manufactured by them was described as ‘jarda/zarda scented tobacco’ and was known and sold in the market as ‘jarda/zarda scented tobacco’ , which was also described in their invoices accordingly. He has categorically admitted in his statement that from April 2006 onwards the assessee started describing their product as ‘chewing tobacco’ for availing the beneﬁ t of Notiﬁ cation of 2 of 2006 dated 01.03.2006, which undisputedly did not continue to reﬂ ect ‘jarda/zarda scented tobacco’ . In this background, when the communication dated 30.03.2006 to the Department intimating the change of classiﬁ cation is perused, it would indicat e the details of the products which was being manufactured was not speciﬁ ed in the said communication at all. In that view of the matter, the communication relied upon by the assessee would pale into insigniﬁ cance. ` 46. The label of the product manufactured by the appellant is “Baghban Zafrani Zarda” and below the label it is indicated as “ﬂ avoured chewing 605 tobacco.” It has been the consistent stand of the assessee that the expression “zarda/jarda” in the tariﬀ entry is diﬀ erent from the term “zarda/jarda” used by the appellant. It is nobody’s case that there was a cha nge in the label or manufacturing process from the six (6) digit era to the eight (8) digit tariﬀ era. The tribunal itself seems to have been in dilemma and has been swayed by the fact that no expert opinion had been obtaine d by the Department for classiﬁ cation. This situation would not arise at all for reasons more than one, ﬁ rstly, the assessee itself right from the beginning has been consistently declaring the product manufactured by it as ‘chewing tobacco’ till the 8-digit regime in 2005 (w.e.f. 24.02.2005) sub-classiﬁ ed the entries as ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ . In the ER-I returns ﬁ led from March 2005 till April 2006 i.e., after the sub-classiﬁ cation, the assessee mentioned the description of the product as ‘zarda scented tobacco’ and from April 2006 reclassiﬁ ed it as ‘chewing tobacco’. 47. At the cost of repetition it requires to be noticed that the Notiﬁ cation No. 2 of 2006 dated 01.03.2006 was issued in supersession of Notiﬁ cation 13 of 2002 dated 01.03.2002 specifying the goods covered under Section 4A of the CE Act, for MRP based assessment. The said notiﬁ cation di d not specify the goods falling under CET SH 2403 9930, i.e., ‘zarda/jarda scented tobacco’ , but it covers the goods falling under CET SH 2403 9910 i.e., ‘chewing tobacco’ . Thus zarda/jarda scented tobacco not having been speciﬁ ed under MRP-based assessment under Section 4A of the CE Act, the goods had to be necessarily assessed under Section 4 of the CE A ct. The assessee being aware that there being no change in the nature of the products, its ingredients and also the manufacturing process had changed and misclassiﬁ ed the product as ‘chewing tobacco’ from ‘zarda/jarda scented’ tobacco. Had the assessee continued its classiﬁ cation as ‘zarda/jarda scented tobacco’ , the duty payable as per transaction value under Section 4 of the CE Act would have been much more than the determination under Section 4A of CE Act after 50 % abatement. It is for this precise reason for avoiding and evading payment of the higher duty, the classiﬁ cation was deliberately changed from ‘zarda/jarda scented tobacco’ to ‘chewing tobacco’ . 48.The reliance placed by the assessee on Board’s l etter dated 23.06.1987, trade notice dated 15.07.1997 and Notiﬁ cation dated 16.03.1995, would have no impact or bearing on the facts of the present case/group, since COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] they were issued during the era of 6-digit tariﬀ classiﬁ cation being imposed. As noticed by us above, the tariﬀ entry having been realigned to 8 digits and there being a speciﬁ c sub-heading being provided and two competing products namely – ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ having been separately classiﬁ ed, the aforesaid circular/notiﬁ cations relied upon by the assessee would not come to rescue of the assessee. 49. It is trite law that when speciﬁ c entry is found in a ﬁ scal statute, the same would prevail over any general entry. If there are two or more sub-headings, the heading which provides the most speciﬁ c description will have to be preferred to a heading providing a more general description. In the light of the aforestated discussion we are of the considered view that classiﬁ cation of the product as adjudicated by the authority deserves to be accepted and ﬁ nding recorded by the tribunal deserves to be set aside and consequently allow these appeals. Thus, b oth the points formulated hereinabove in this group is answered in f avour of the Revenue and against the asessee. II. COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH V . M/S. FLAKES-N-FLA VOURZ [ C. A. 5146/2015] 50. In the instant group, the Revenue is in appeal assailing the order passed by the Customs, Excise and Service Tax Appellate Trib unal (CESTAT), New Delhi dated 20.02.2014 by the jurisdictional tribunal. BRIEF FACTS 51. The respondent-assessee is the manufacturer of zarda , pan chatni and scented supari falling under the category of excisable goods under the CETA, and was clearing its product ‘Gopal Zarda’ under CET SH 2403 9910 as ‘chewing tobacco’ and paid excise duty based on retail sale price under section 4A of the CE Act, (hereinafter to referred as “CE Act”). During the audit, it was found that the assessee’s product merits classi ﬁ cation under CET SH 2403 9930 as ‘Zarda/Jarda scented Tobacco’ . On redetermination of value under section 4 of the CE Act it was found that the assessee has short- paid excise duty by Rs. 4,28,65,508/- and accordingly, a show cause notice came to be issued under section 11A of the CE Act. The Commissioner of Central Excise, in his OIO dated 02.04.2008 conﬁ rmed the demand of duty, interest, penalty and held that the product manufactured by the respondent- 607 assessee falls under CET SH 2403 9930 as ‘Zarda/Jarda scented tobacco’ by concluding that assessment has to be made under section 4 of the CE Act. An appeal was preferred against the said order before the CESTAT which came to be allowed and the OIO dated 02.04.2008 was set aside. SUBMISSIONS OF THE PARTIES 52. We have heard the learned advocates appearing for the parties. 53. Ms. Nisha Bagchi learned counsel appearing for the Department has supported the OIO dated 02.04.2008 while contending that the tribunal committed an error in setting aside the said ﬁ ndings and in holding that the product in question was classiﬁ able as ‘chewing tobacco’ under CET SH 2403 9910 and rejecting the stand of the department th at same should be classiﬁ ed as ‘zarda/jarda scented tobacco’ under CET SH 2403 9930. She would contend that the tribunal erred in relying upon its ﬁ ndings recorded in M/s Urmin Products Private Limited which undisputedly is under challenge before this Court in Civil Appeal No. 10159-161 of 2010 (Group I) and as such it ought not to have relied upon the said judgment. She would also contend that the tribunal erred in not considering the fact on 15.02.2007 Shri Manoj Gupta, partner of the appellant, he has admitted that perfumery compounds are added to the raw tobacco and as such product is to be classiﬁ ed under CET SH 2403 9930 as ‘Zarda/Jarda scented tobacco’ and not ‘chewing tobacco’. 54. She would contend that prior to CETA (Amendment), 2004 came into force on 28.02.2005, ‘chewing tobacco’ and its preparations were covered under chapter 2404.41 and after the amendment the sai d chapter heading was classiﬁ ed into three separate tariﬀ items within the chapter heading 2404 namely, ‘chewing tobacco’ , preparations containing ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ and would contend all these three items were earlier classiﬁ ed collectively under chapter heading 2404.41 and the classiﬁ cation as it exists today clearly suggests that ‘chewing tobacco’ is not scented/ﬂ avoured/perfumed tobacco and both the disputed items fall under diﬀ erent and distinct classes of products. She would also submit that the assessee themselves admit that their product is ‘zarda/jarda’ and even the packed pouches bear printed description of their contents as ‘Gopal Zarda’ . Reiterating the contentions raised, grounds urged and pleas put forward Civil Appeal No. 10159-161 of 2010 ( M/s Urmin Products Private Limited ), she prays for allowing this appeal. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 55. Per contra, Mr. Vivek Kohli, learned senior counsel, appearing for the respondent has reiterated the contentions raised and grounds urged before the tribunal. He would contend that throughout the period befo re dispute, during the disputed period and even after the disputed period, the product manufactured by the assessee was classiﬁ ed as ‘chewing tobacco/ ﬂ avoured chewing tobacco’ . Even the ER-1 returns and weekly online returns ﬁ led by the assessee classifying the product as ‘chewing tobacco’ were accepted by the Revenue without any objection. He would contend that even after introduction of 8-digit tariﬀ for full one year i.e., from 1.03.2005 to 28.02.2006, the assessee classiﬁ ed its product under tariﬀ entry number 2403 9910 and discharged its tax liability under Section 4A of CE Act, which was accepted with full knowledge by the Revenue and raising obje ction during audit of the unit for the period 1.03.2006 to 11.07.2006 is possibility of higher Revenue during this period is due to (a) technical oversight by the Revenue itself which was later corrected and, (b) the alternate assessment on transaction value rather than MRP based assessment. He would contend that when classiﬁ cation of the product is accepted earlier and for the subsequent period, same cannot be classiﬁ ed diﬀ erently. There being no deﬁ nition of the competing products, the application of the common parlance test is to be adopted and when so adopted the only conclusion that has to be drawn is that product is to be construed as ‘chewing tobacco’ , as declared in invoices and understood by distribution chain of dealers, stockists, retailer s and consumers. He would submit that burden of proof lies on the Revenue as classiﬁ cation is a question relating to chargeability and the same having not been discharged by adducing any evidence whatsoever the classiﬁ cation as done by the adjudicating authority has been right set-aside by the tribunal. 56. He would submit that the Revenue is seeking to impose classiﬁ cation wherein the word ‘perfumery’ to impart ﬂ avour to ‘chewing tobacco’ has the basis and the fact remains the very same process is adopted since decades. Based on uncorroborated statement the classiﬁ cation cannot be done. To conclude he would contend that as opined that this court in W.P.I.L. v. CCE Meerut – 2005 (181) ELT 359 has opined that during transition phases inadvertent mistakes have to be interpreted / understood in the light of or in the context of policy prevailing in respect of the product and the policy then existing was to tax tobacco products under Section 4 A of the CE Act – MRP based assessment, it is only logical that classiﬁ cation 609 declared by the assessee and declared by the department prevail. Hence, he prays for dismissal of the appeal by relying upon the following judgments. i. HPL Chemicals Limited v. CCE Chandigarh. 2006 (197) ELT 324 (SC) ii. Mauri Yeast India Private Limited v. State of UP. 2008 (225) ELT 321 (SC) iii. C.G. and S.T. CCE and S.T., Rohtak v. Som Flavour Masala Private Limited iv. CCE, Nagpur v. Shree Baidyanath Ayurved Bhawan. 2009 (237) ELT 225 (SC) v. W.P.I.L. Limited v. CCE, Meerut. 2005 (181) ELT 359 SC. DISCUSSION AND FINDINGS 57. The period involved in the present appeal pertains to 01.03.2006 to 10.07.2006. During the audit of the accounts of the assessee, the department noticed that the assessee was manufactur ing ‘zarda/jarda scented tobacco’ and was claiming it as ‘chewing tobacco’ . The stand of the assessee has been that they were manufacturing vari eties of ﬂ avoured ‘chewing tobacco’. Hence, the statement of the partner of the assessee came to be recorded on 15.02.2007, which has been noticed in p aragraph 3 of show cause notice dated 30.03.2007. Hence, we do not propose to extract the same. A perusal of the said statement would ind icate the manner in which the product has been manufactured. It is admitted in the statement given by the partner of the assessee, that raw tobacco is mixed with an additive mixture which is manufactured by mixing perfumery compounds received from the noticee’s Delhi Unit itself. He als o admits that to this perfumery mixture, further compounds are added for making various types of tobacco to be manufactured. Based on this statement a nd precisely for the reason that the product manufactured by the assess ee seems to not be ‘chewing tobacco’ , aforesaid show cause notice dated 30.03.2007 came to be issued by calling upon the assessee to show caus e as to why the short-paid duty amounting to Rs.4,28,65,508/- should not be recovered. The said show cause notice came to be adjudicated and the Commissioner conﬁ rmed the said demand. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 58. Being aggrieved by the order dated 02.04.2008 passed by the Commissioner, appeal before the tribunal was ﬁ led and as already noticed hereinabove, there were divergent views of the Member (Judic ial) and Member (Technical). The judicial member at paragraph 16 of the order held that the appellant (assessee) had properly classiﬁ e d it as ‘chewing tobacco’ under CET SH 2403 9910 and applying the principles laid in M/s Urmin Products Private Limited (which is the subject mat ter of Civil Appeal No. 10159-161 of 2010) allowed the appeal whereas the technical member disagreed with the said view and held that the product manufactured by the appellant-assessee is to be classiﬁ ed as ‘zarda/jarda scented tobacco’ under CET SH 2403 9930 and should be assessed under the provision of Section 4 of CE Act, for the relevant period and with eﬀ ect from 11.07.2006 under Section 4A when speciﬁ c Notiﬁ cation No.16/2006 dated 11.07.2006 came into force. 59. In the light of the diﬀ erence of opinion the matter came to b e referred to the opinion of a third member who concurred with the view expressed by the judicial member and held that the product manufactured by the petitioner was ‘chewing tobacco’ and not ‘zarda/jarda scented tobacco’ as claimed by the Revenue. 60. It is pertinent to mention that the issue concerning classiﬁ cation has been discussed by us herein above in the matter of Commissioner of Central Excise, Ahmedabad Vs. M/s Urmin Products Private Limited and Others and ﬁ ndings recorded by us in paragraph no.(s) 46,47,48 and 49 supra would be squarely applicable to the facts on hand. 61. Undisputedly, the tribunal as noticed herein above has relied upon the view expressed in M/s Urmin Products Private Limited by it to arrive at a conclusion that the product is to be classiﬁ ed as ‘chewing tobacco’ . 62. It is no doubt true that in the instant case, the assessee duly has been declaring the product manufactured by it as ‘chewing tobacco’ . However, the fact remains that there was no issue till the Six-digit tar iﬀ era which was revoked with the introduction of the Eight-digit tariﬀ head. Pursuant to the same the entry was reorganized and reclassiﬁ ed as ‘chewing tobacco’ (2403 9910), a preparation containing the ‘chewing tobacco’ (2403 9920) and ‘zarda/jarda scented tobacco’ (2403 9930). Circular No. 808/5/2005- CX dated 25.02.2005 came to be issued whereunder classiﬁ cation was 611 given that the subsisting notiﬁ cation having a six-digit enumeration should be read in terms of the eight-digit of the new Central Excise Tariﬀ . On 01.03.2006, Notiﬁ cation No. 02/2006 came to be issued by virtue of which a Notiﬁ cation No. 13/2002 dated 01.03.2002 was superseded. Thus, the list of products with their respective chapter headings/sub-headings, which were to be covered under the MRP-based assessment in terms of S ection 4A of the CE Act, was notiﬁ ed in terms of an Eight-digit tariﬀ . In the said notiﬁ cation ‘zarda/jarda scented tobacco’ was left out or was not included for MRP-based assessment. Subsequently, by clariﬁ catory Notiﬁ cation No. 16/2006 dated 11.07.2006, the product ‘zarda/jarda scented tobacco’ was brought back within the MRP-based assessment beneﬁ t. Thus, the burning issue would be between the period 01.03.2006 to 11.07.2006 which in the instant case relates to 01.03.2006 to 10.07.2006. 63. In the instant case, the facts do not disclose there being a change in the declaration of the product manufactured by the present res pondent herein, as was in the case with M/s Urmin Products Private Limited . Even otherwise by virtue of the change from Six-digit tariﬀ to Eight-digit tariﬀ era and during the period 01.03.2006 to 11.07.2006. Though the generic word ‘chewing tobacco’ including preparation commonly known as “khara masala, quiwam, dhokta, zarda, sukha, surti” or “chewing tobacco and preparation containing chewing tobacco” got bifurcated or took its new birth by virtue of which the said entry was re-organised and classiﬁ ed under three headings namely ‘chewing tobacco’ (2403 9910), ‘preparations containing chewing tobacco’ (2403 9920) and ‘zarda/jarda scented tobacco’ (2403 9930), the heading ‘zarda/jarda scented tobacco’ did not ﬁ nd a place in the corresponding Notiﬁ cation No. 02/2006 dated 01.03.2006 and thereby the ‘zarda/jarda’ scented tobacco got excluded from the preview of the Notiﬁ cation No. 02/2006 and the beneﬁ t of the assessment in terms of Section 4A was no more available for the product ‘zarda/jarda scented tobacco’ or in other words the manufacturers of ‘zarda/jarda scented tobacco’ were required to be assessed under Section 4 of CE Act. On account of t his there was a huge gap in the central excise duty leviable under Section 4 of the CE Act, which would obviously be the heartburn for the taxpay ers which resulted in the above-noticed tug of war between the Revenue and the assessee, wherein the assessee contended the products manufa ctured by it though scented or ﬂ avoured still continued to be ‘chewing tobacco’ COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] and it did not partake the character of the ‘zarda/jarda scented tobacco’ . For ﬁ nding an answer to this question, apart from the ﬁ nding recorded in M/s Urmin Products Private Limited’s case, we deem it appropriate to note that the general rules for the interpretation of the goods are tra ceable to provisions of the CETA under the chapter heading “general rules for the interpretation this schedule” . Presuming for a moment that where goods are prima facie classiﬁ able under two or more headings (by accepting the proposition of the assessee) it raises a serious doubt with regard to the classiﬁ cation of the product. In such circumstances, section 2 of the CETA, 1985 provides that the rates at which duties of excise shall be leviable under the CE Act, are speciﬁ ed in the ﬁ rst and second schedules. The ﬁ rst schedule contains a set of rules known as “general rules for the interpretation of this schedule” . These rules begin with a mandate that the classiﬁ cation of goods in this schedule shall be governed by the following principles laid thereunder. This rule had received interpretation of this Court in the matter of Westinghouse Saxby Farmer Ltd. v. Commissioner of Central Excise, Calcutta, (2021) 5 SCC 586 whereunder it came to be held as follows: “26. Rule 1 of these Rules makes it clear that “the titles of Sections, Chapters and Sub-Chapters are provided for ease of reference only and that for legal purposes, classiﬁ cation shall be determined according to the terms of the headings and any relative Section or Chapter Notes and provided such headings or Notes do not otherwise require, according to the provisions of the rules that follow”. 27. Rule 2 deals with (i) incomplete or unﬁ nished articles; and (i i) mixtures or combinations of material or substance. While Rule 2(a) deals with incomplete or unﬁ nished Articles, Rule 2(b) deals wi th mixtures or combinations of a material or substance. 28. Rule 3 deals with cases where goods are classiﬁ able under two or more sub-headings. But Rule 3 begins with a reference to Rule 2(b). Therefore, it is necessary to extract Rule 2(b) and Rule 3 together. They read as follows: “2. ( a )*** ( b ) Any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combinations of that material or 613 substance with other materials or substances. Any reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classiﬁ cation of goods consisting of more than one material or substance shall be according to the principles of Rule 3. 3. When by application of Rule 2(b) or for any other reason, goods are, prima facie, classiﬁ able under two or more headings, classiﬁ cation shall be eﬀ ected as follows: ( a ) the heading which provides the most speciﬁ c description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally speciﬁ c in relation to those goods, even if one of them gives a more complete or precise description of the goods. ( b ) mixtures, composite goods consisting of diﬀ erent materials or made up of diﬀ erent components, and goods put up in sets for retail sale, which cannot be classiﬁ ed by reference to clause (a), shall be classiﬁ ed as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable. ( c ) when goods cannot be classiﬁ ed by reference to clause (a) or clause (b), they shall be classiﬁ ed under the heading which occurs last in numerical order among those which equally merit consideration.” 64. On the strength of the inputs used in the manufacture of the disputed product and the end product which is sought to be classiﬁ ed a s ‘chewing tobacco’ by the assessee and ‘zarda/jarda scented tobacco’ by the Revenue, results in the moot question, as to what test is to be adopted namely, whether sole or principal usage test is to be applied? This Court in Westinghouse Saxby Farmer Ltd.’s case (supra) had an occasion to deal with similar issues and took note of the earlier dicta of this Court rendered in A. Nagaraju Bros. v. State of A.P., 1994 Supp (3) SCC 122 and held there is no ‘one’ single universal test in this matter. 65. Keeping these aspects in mind when the facts on hand are perused it would disclose the product manufactured by the assessee-res pondent is COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] sold as ‘Gopal zarda’ and both the members of the tribunal namely, technical members and judicial members are ad idem on the issue of the manufacturing process of the goods and the product in question namely, they all agree that tobacco ﬂ avouring substance is added and the judicial member has clearly held that the product is marketed as “ﬂ avoured chewing tobacco”. This addition of scent or ﬂ avour in the ‘chewing tobacco’ was contended to be ‘zarda/jarda scented tobacco’ by the Revenue, whereas the assessee has taken a stand that by addition of the scent or ﬂ avour, it would not partake the character of the ‘zarda/jarda scented tobacco’ but continues to be ‘chewing tobacco’ . In this background, the diﬀ erence between ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ if attempted to be ascertained from the deﬁ nition found in the glossary of Bureau of Indian Standards, particularly in terms of deﬁ nition and preparation, it is classiﬁ ed as under: “2.27 ‘Chewing Tobacco¬’- Chewing tobacco, as its name suggests is a tobacco preparation for chewing purpose, also taken with paan (betel leaf). Gutka, surti, zarda, quiwam and dokta are some of the diﬀ erent types of chewing tobacco preparations. 2.184 ‘Zarda’ - A chewing tobacco product made of highly scented and ﬂ avoured tobacco ﬂ akes. Chewed along with betel nut and paan (betel leaf).” 66. A careful perusal of the meaning allocated to th e concerned products, ‘Chewing Tobacco’ and ‘Zarda’ leads to formulation of the following distinction based on the diﬀ erent parameters as under: “Preparation and Form Chewing Tobacco: Chewing tobacco typically comes in loose leaf or twist form. It consists of cured and fermented tobacco leaves. Chewing tobacco is usually taken by placing a portion of it between the cheek and gum, where it releases nicotine over time as it’s slowly chewed. Zarda Tobacco: Zarda, on the other hand, is a speciﬁ c type of chewing tobacco that is ﬁ nely chopped or shredded and highly scented and ﬂ avoured. It is often sweetened and can be brightly coloured. Zarda is known for its strong and distinct aroma and ﬂ avour. It is often consumed by placing it in the mouth, similar to other chewing tobacco products, and is sometimes chewed along with betel nut and paan. 615 Flavour and Aroma Chewing Tobacco: Chewing tobacco can come in various ﬂ avours, but it may not always be as strongly scented or ﬂ avoured as Zarda. The ﬂ avours can range from natural tobacco ﬂ avours to menthol, wintergreen, or other fruit and spice ﬂ avours. Zarda Tobacco: Zarda is speciﬁ cally known for its highly scented and ﬂ avoured nature. It is often infused with strong spices and sweeteners, giving it a distinct and potent aroma and taste. The ﬂ avours in Zarda are often more pronounced and intense compared to regular chewing tobacco. Use with Betel Nut and Paan Chewing Tobacco: While chewing tobacco can be used alongside betel nut and paan, it is not exclusive to this combination. Chewing tobacco can be used independently as well. Zarda Tobacco: Zarda is more commonly associated with being used in combination with betel nut and paan. This combination i s often considered a traditional practice in some South Asian cultures.” 67. At this juncture, it may be relevant to draw a distinction between the facts of the instant case and the facts in the case of Urmin supra. In the present factual scenario, there has been a consistent and clear classiﬁ cation provided by the assessee, which was accepted by the Revenue, prior to the dispute arising from the audit objection raised by the concerned assessing oﬃ cer. 68. Unlike the facts as narrated above in Group I, i.e., Urmin, whereunder the assessee therein had sought to change the classiﬁ cation of the goods manufactured by them, particularly when there was a diﬀ erence in the duty, and a much higher duty was required to be paid by the assessee. Whereas in the instant case on hand, there has been no change in classiﬁ cation of the product which was sought by the assessee. It is settled law that the onus/burden of proof for change in classiﬁ cation of the product lies on the Department, particularly when it wishes to challenge a long-accepted classiﬁ cation. This court in the case of HPL Chemicals Limited Vs. CCE, Chandigarh: 2006 5 SCC 208 while discussing the onus/burden of proof in matters of chargeability held as follows: COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] “28. This apart, classification of goods is a matte r relating to chargeability and the burden of proof is squarely upon the Revenue. If the Department intends to classify the goods under a particular heading or sub-heading diﬀ erent from that claimed by the assessee, the Department has to adduce proper evidence and discharge the burden of proof. In the present case the said burden has not been discharged at all by the Revenue. On the one hand, from the trade and market enquiries made by the Department, from the report of the Chemical Examiner, CRCL and from HSN, it is quite clear that the goods are classiﬁ able as “denatured salt” falling under Chapter Heading 25.01. The Department has not shown that the subject product is not bought or sold or is not known or is dealt with in the market as denatured salt. The Department’s own Chemical Examiner after examining the chemical composition has not said that it is not denatured salt. On the other hand, after examining the chemical composition has opined that the subject-matter is to be treated as sodium chloride.” 29. It has been held by this Court in a number of judgments that the burden of proof is on the Revenue in the matter of classiﬁ cation. In Union of India v. Garware Nylons Ltd. [(1996) 10 SCC 413] in para 15 this Court held as under: (SCC pp. 419-20) “15. In our view, the conclusion reached by the High Court is fully in accord with the decisions of this Court and the same is justiﬁ ed in law. The burden of proof is on the taxing authorities to show that the particular case or item in question is taxable in the manner clai med by them. Mere assertion in that regard is of no avail. It has been held by this Court that there should be material to enter appropriate ﬁ nding in that regard and the material may be either oral or documentary. It is for the taxing authority to lay evidence in that behalf even be fore the ﬁ rst adjudicating authority. Especially in a case as this, where the claim of the assessee is borne out by the trade enquiries received by them and also the aﬃ davits ﬁ led by persons dealing with the subject- matter , a heavy burden lay upon the Revenue to disprove the sai d materials by adducing proper evidence. Unfortunately, no such attempt was made. As stated, the evidence led in this case conclusively goes to show that nylon twine manufactured by the assessee has been treated 617 as a kind of nylon yarn by the people conversant with the trade. It is commonly considered as nylon yarn. Hence, it is to be classiﬁ ed under Item 18 of the Act. The Revenue has failed to establish the contr ary. We would do well to remember the guidelines laid down by this Court in Dunlop India Ltd. v. Union of India [(1976) 2 SCC 241 : AIR 1977 SC 597] in such a situation, wherein it was stated: (SCC p. 254, AIR p. 607, para 35) ‘When an article has, by all standards, a reasonable claim t o be classiﬁ ed under an enumerated item in the Tariﬀ Schedule, it will be against the very principle of classiﬁ cation to deny it the parentage and consign it to an orphanage of the residuary clause.’ ” 69. Given the circumstances in the present case, the Department has not provided any suﬃ cient evidence before this Court determine the nature, characteristics, contents, and composition of the product in order to adjudicate the present dispute purely on the issue of classiﬁ cation and hence no attempt can be made to determine the appropriate entry of classiﬁ cation for the product manufactured by the assessee at the relevant period of time of the dispute. The Revenue has also not raised any speciﬁ c grounds in relation to any wilful misstatement with an intention to evade duty on part of the assessee, as opposed to the case of Urmin wherein one of the main grounds urged was the intention to avoid payment of duty. It is pertinent to mention that there is a speciﬁ c observation made by the Commissioner in his OIO dated 30.03.2007 that no wilful suppression is attributable to the assessee, and placing reliance on this very observation, the trib unal had also set-aside the penalty imposed upon the assesssee. It may be noted that this court in the case of CCE vs. Damnet Chemicals Private Ltd. (2007) 7 SCC 490 had held: “26. In the circumstances, we ﬁ nd it diﬃ cult to hold that there has been conscious or deliberate withholding of information by the assessee. There has been no wilful misstatement much less any deliberate and wilful suppression of facts. It is settled law that in order to invoke the proviso to Section 11-A(1) a mere misstatement could not be enough. The requirement in law is that such misstatement or suppres sion of facts must be wilful. We do not propose to burden this judgment with various authoritative pronouncements except to refer the judgment of COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] this Court in Anand Nishikawa Co. Ltd. v. CCE [(2005) 7 SCC 749 : (2005) 188 ELT 149] wherein this Court held : (SCC p. 759, para 27) “27. … we ﬁ nd that ‘suppression of facts’ can have only one meaning that the correct information was not disclosed deliberately to evade payment of duty. When facts were known to both the parties, the omission by one to do what he might have done and not that he must have done, would not render it suppression. It is settled law that mere failure to declare does not amount to wilful suppression. There must be some positive act from the side of the assessee to ﬁ nd wilful suppression.” (emphasis supplied) 27. It is clear from the material available on record that the Excise Authorities had inspected the manufacture process, collected the necessary information and details from the responde nt assessee and even collected the samples and sent for chemical analysi s. The authorities were aware of the tests and analysis reports of the products manufactured by the respondent assessee. The relevant facts were very much within the knowledge of the Department authorities. The Department did not make any attempt to lead any evidence that there was any wilful misstatement or suppression of facts with intent to evade payment of duty.” 70. Classiﬁ cation is a question relating to “chargeability”. It is well settled law that insofar as chargeability is concerned, the burden of proof lies on the Revenue and not on the assessee. In the facts obtained in the present case, no evidence of whatsoever nature has been placed by the Revenue to raise any presumption. In fact, the entire proceedings are based upon “audit objection” and the Revenue attempts to rely upon the additives to the ‘chewing tobacco’ as the basis for arriving at a conclusion, that assessee had cleared the ‘jarda/zarda scented tobacco’ which is not even supported by the samples drawn or inquiry made from the traders or consumers or stockist, suppliers and buyers. In the absence of iota of material, the ﬁ nding of the tribunal cannot be displaced. It would be of beneﬁ t to extract the ﬁ nding recorded by the third member of the tribunal, who upheld the ﬁ nding of the judicial member and it reads: 619 “9 In the tariﬀ the expression xxxx practice. In the present case, as the product is ﬂ avour chewing tobacco and it is bought and sold in the market as chewing tobacco. Further the appellant from the beginning classifying the same as chewing tobacco and after the period in dispute also classiﬁ ed the same as chewing tobacco. Hence I ﬁ nd merit in the contention of the appellant that the product in question is ch ewing tobacco and classiﬁ able under Heading 24039910 of the Tariﬀ .” 71. Upon anxious consideration of the aforestated facts, coupled with lack of cogent evidence for the purpose of determination of the classiﬁ cation entry with respect to the product manufactured by the assessee, we deem it necessary to not interfere with the ﬁ ndings of the tribunal in light of the settled judicial ﬁ ndings of this Court which directly have a bearing on the facts of the present case. 72. At the cost of repetition, we would further like to reiterate that the observations and ﬁ ndings recorded in this group are exclusive to the peculiar facts of this case only. III. COMMISSIONER OF CENTRAL GOODS AND SERVICE TAX EXCISE AND CUSTOMS BHOPAL V . KAIPAN MASALA PVT. LTD. DIARY NO. 44912/2019 AND 6888/2020 73. Two Appeals i.e., Diary No. 44912 of 2019 and Diary No. 6888 of 2020 are the subject matter of this group whereunder the Revenue is in appeal challenging the order of the jurisdictional CESTAT dated 14.11.2018 passed in Excise Appeal Nos. 50468, 50469, 50470, 50471, 57472, 51319 and 51978 of 2018. BRIEF FACTS 74. Before adverting to the facts of the present group it may be noticed that with eﬀ ect from 01.03.2015, the capacity of production per packing machine per month and rate of duty for ‘chewing tobacco’ and ‘Zarda/ jarda Scented Tobacco’ was amended vide Notiﬁ cation No. 4/2015 and Notiﬁ cation No. 5/2015-C.E. (N.T.), respectively and the duty for ‘chewing tobacco’ was prescribed diﬀ erently as compared to ‘Zarda/Jarda scented tobacco’ as already noticed herein above. The respondent-assessee vide their communication letter dated 18.03.2015 intimated to the jurisdictional competent authority that the product manufactured by them is only ‘scented COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] zarda/jarda tobacco’ which is diﬀ erent from ‘chewing tobacco.’ They also informed that the nomenclature of ‘chewing tobacco’ is being used as there was no diﬀ erence in the capacity of production as well as the rate of duty before the budget of 2015-16. In response to the said letter of the assessee, the Range Superintendent vide his letter dated 19.03.2015 requested the assessee to submit the manufacturing process of their product. Hence, the assessee vide its communication dated 24.03.2015 informed that ‘chewing tobacco’ and ‘scented zarda/jarda tobacco’ , both contain the same ingredients. 75. A Notiﬁ cation No. 25/2015-CE dated 30.04.2015 was brought with eﬀ ect from 01.05.2015 whereby the rate of Central Excise Duty of ‘zarda/jarda scented tobacco’ came to be amended again but there was no change in the rate of duty on ‘Chewing Tobacco’ as compared to ‘zarda/ jarda scented tobacco’. 76. The assesee vide communication dated 28.05.2015 intimated to the department that with eﬀ ect from 01.06.2015, they would be manufacturing ‘chewing tobacco’ falling under CET SH 2403 9910 instead of ‘scented zarda/jarda tobacco’ falling under CET SH 2403 9930 and accordingly submitted a revised form to the competent oﬃ cer. In the background of frequent changes made in the classiﬁ cation by the assessee and in order to ascertain the proper classiﬁ cation of goods, the oﬃ cers of the department drew the samples of the products under panchnama dated 01.06.2015 and forwarded the same to the chemical examiner, CRCL, New Del hi and received the test report on 03.06.2015. It was found that the ‘chewing tobacco’ contains identical ingredients that are contained in ‘scented zarda/jarda tobacco.’ It was also noticed by the department that assessee through communication and declaration form ﬁ led prior to 28.05.2015 had mentioned their product as Pan masala and “scented zarda/jarda tobacco” . Thus, having found that the product manufactured by the assessee namely, contains the same ingredients as ‘chewing tobacco’ and ‘scented zarda/ jarda tobacco’ and involves the same manufacturing process which was conﬁ rmed by the CRCL Report vide dated 03.06.2015 and the assessee had attempted to change their stand by ﬁ ling convenient declarations, the claim of the assessee was not accepted. It appeared that the assessee deliberately and intentionally mis-declared and misclassiﬁ ed their products with an intention to evade central excise duty. Hence an order dated 28.08.2015 621 came to be passed which covered the period of June 2015 to August 2015. In continuation of the same, four more orders for the period November 2015; December 2015; January 2016, and February 2016 came to be passed vide order dated 30.10.2015; 27.11.2015; 31.12.2015, an d 29.01.2016 respectively demanding the amounts indicated therein. Being aggrieved by the said orders, the assessee preferred appeal Nos. 338 of 2015 , 53 of 2016, 52 of 2016, 209 of 2016 and 210 of 2016 before the Commissioner (Appeals), which came to be disposed of by order dated 23.10.2017 on the ground that a notice under Section 11A of the CE Act, has already been issued for determination and conﬁ rmation of the duty payable, the assessee has liberty to raise all grounds before the authority adjudica ting in the proceedings initiated vide the show cause notice issued on 02.02.2016 and accordingly, the appeals came to be disposed of vide order dated 23.10.2017. 77. The show cause notice dated 02.02.2016 came to be adjudicated vide order dated 16.07.2018 whereunder demand of du ty amount of Rs.7,47,66,000/- along with interest and penalty ca me to be passed. Being aggrieved by the said order, the assessee has ﬁ led an Ap peal No. E/53421/2018-EX(DB) before CESTAT, New Delhi which is pending ; however, the assessee has simultaneously proceeded to challenge the order dated 23.10.2017 passed by the Commissioner (Appeals) before the tribunal in Appeal No. E/50468, 50469, 50470, 50471, and 50472 of 2018 which came to be allowed vide order 14.11.2018. Hence, the Revenue is in appeal in Civil Appeal Diary No. 6888 of 2020 against the said order the order dated 14.11.2018 passed by the CESTAT. 78. Similarly, the Revenue has also come in appeal in Civil Appe al Diary No. 44912 of 2019 against the order dated 14.11.2018 passed in Excise Appeal 51978 of 2018 and Excise Appeal No. 51319 of 2018 against the respondent-assessee wherein the Show Cause Notice dated 01.03.2017 was issued for the payment of diﬀ erential duty of Rs. 16,95,33,000 by the Directorate General of Central Excise Intelligence Bhopal for the period of June 2015 to February 2016 which culminated in order-in-original dated 20.12.2017. The said order held that the assessee has misclassiﬁ ed the product as ‘chewing tobacco’ instead of ‘zarda/jarda scented tobacco’ and the diﬀ erential duty claimed in Show Cause Notice was aﬃ rmed. The said order became the subject of appeal No.51978 of 2018 and No.51319 of COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 2018 before the CESTAT which vide the common order dated 14.11.2018 set aside the OIO. SUBMISSIONS OF PARTIES 79. Ms. Nisha Bagchi learned counsel appearing for Revenue, would contend, that tribunal committed a serious error in holding the product in question as ‘chewing tobacco’ though it was to be classiﬁ ed as ‘zarda/jarda scented tobacco’. She would contend that tribunal failed to appreciate the test report dated 4.11.2015, suggested that the product did not contain added lime and yet on the ground test reports not having been drawn a ﬁ nding has been recorded by the tribunal to the eﬀ ect that adjudicating authority was not in a position to correlate the test report in the absence of t est memo. She would also contend that tribunal failed to notice that assessee itself had requested for retest of the sample on the ground that the test report is not very speciﬁ c and the various parameters on which it was opined that the sample contained the characteristics of ZST have been clearly spelt out and that the retest has been allowed by the adjudicating authority is factually not correct. The prayer for retest not being in consonance with CBEC’s manual. Hence, she would contend that tribunal ought to have remanded the matter. She would further contend that the tribunal ignored the statement dated 27.10.2015 of Shri Ram Gopal Agnihotri, Director of assessee company whereunder the distinction between CT and ZST has been admitted as also the ingredients of the product manufactured by the assessee was set out. She would submit that the ﬁ nding of CRCL on the test reports has been ignored by the tribunal, which clearly disclosed the ﬁ nal product manufactured by the assessee was ZST. Hence, she prays for the appeal to be allowed. 80. Whereas the learned Counsel appearing for the respondent would contend that the order passed by the Tribunal does not suﬀ er from a ny inﬁ rmity and it is contended that assessee, admittedly, had followed the due procedure in law by following the statutory declarations under the CTPM Rules, declaring that they intend to operate diﬀ erent number of machines in each of the months under dispute. It is contended that had there been any malaﬁ de intentions to wrongly claim the beneﬁ t reduced rate of duty on CT, the assess would have either increased its production by increasing the number of operating machines or at least would have maintained the very same number of operating machines. However, every month the asses see 623 was consistently reducing the operating machines as per the demand of its product in the market. The decision to manufacture ZST prior to the period of dispute, and to manufacture CT during the period of dispute as well as using diﬀ erent number of packing machines every month was purely a commercial decision taken by the assessee based on several factors. By supporting the order of the tribunal, it is contended that CT and ZST are diﬀ erent product and known as such in the market and as such there cannot be a ﬂ ip ﬂ op by selling same product in two diﬀ erent names. It is also canvas sed that no enquiry was conducted by the department to ascertain the classiﬁ cation of the product namely no market enquiry was conducted to ascertain the common parlance understanding of the product. The product sold by the assessee had been described on the package as ‘chewing tobacco premium’ and as per the Legal metrology (packaged commodities) rules 2011, the labelling/description contained on the packaging is determinative of the goods contained in the package, until proved to the contrary. Hence, the assessee has prayed for dismissal of the appeal. DISCUSSION & FINDINGS 81. It is pertinent to note at the outset that show cause notice dated 02.02.2016 for the classiﬁ cation of the product is the subject matter of the appeal before the CESTAT in Appeal No. E/53421 of 2018 where under the order dated 16.07.2018 is impugned before it. The said order dated 16.07.2018 has been passed by the Commissioner pertains to the period of June 2015 to August 2015 where the Commissioner has adjudicated an d passed an order regarding mis-classiﬁ cation. 82. The orders dated 30.10.2015, 27.11.2015, 31.12. 2015 and 29.01.2016 which were impugned before the Commissioner (App eals) were disposed of on 23.10.2017 in the background of the show cause notice dated 02.02.2016. 83. The assessee who has two units namely, at Bhopal and Bila spur by communication dated 18.03.2015 intimated the Jurisdictional Divisional oﬃ cer that the product manufactured by them is ‘zarda/jarda scented tobacco’ which is entirely diﬀ erent from ‘chewing tobacco’ . It was also intimated that the nomenclature ‘chewing tobacco’ is being use d as there was no diﬀ erence in capacity of production as well as rate of duty before budget 2015-16, since the government ﬁ xed diﬀ erent rates of duty for these COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] products, they shall be discharging central excise duty as per the Notiﬁ cation No. 05/2015 dated 01.03.2015. However, the assessee vide its letter dated 08.06.2015 addressed to the jurisdictional Range oﬃ cer inform ed that the manufacturing process of ‘chewing tobacco’ and the ingredients used for manufacturing are same for both the products. It is also admit ted by the assessee that ‘zarda/jarda scented tobacco’ would contain additional ingredients of gulab jal, glycerine and perfume and as such panchnama dated 01.06.2015 was drawn. The report chemical examiner disclosed that t he samples obtained from the factory of the assessee where the assessee claimed to manufacture only ‘chewing tobacco’ also contained the same ingredients that are used in the manufacturing of ‘scented zarda/jarda tobacco’ . It is for this precise reason, the proceedings for misdeclaration and misclassiﬁ cation came to be initiated and OIO dated 28.08.2015 came to be passed which was aﬃ rmed in appeal on 23.10.2017. The adjudicating oﬃ cer after having taken note of the chemical examiner’s report dated 03.08.2015, whereunder it was found that the ‘chewing tobacco’ manufactured by the assessee contains identical ingredients that are contained in ‘zarda/jarda scented tobacco’ had arrived at a conclusion that the assessee has mis declared and misclassiﬁ ed its goods as ‘chewing tobacco’ instead of ‘scented zarda/jarda tobacco’ . 84. When the assessee itself vide a letter dated 18.03.2015 (refer to in para 6.4 at page 95 of order in original dated 16.07.2018) has intimated that the product manufactured by it was ‘zarda/jarda scented tobacco’ . The stand or change of the nomenclature by the assessee contending that it is only ‘chewing tobacco’ is completely misplaced for three reasons namely: (1) there was no change in the manufacturing process of both the items and the product was claimed to be ‘chewing tobacco’ containing the same ingredients as that of ‘zarda/jarda scented tobacco’ ; (2) The declaration was ﬁ led by assessee as ‘scented zarda/jarda tobacco’ up till 27.04.2015; (3) The duty payable had been determined on the basis of the deemed capacity of production under Rule 6(2) of the CTPM Rules. 85. On omission of Compounded Levy Scheme vide Act No. 14 of 2001 Section 3A of the CE Act, was again inserted by Act 18 of 2008, hence ‘chewing tobacco’ was notiﬁ ed under Section 3A by Notiﬁ cation No. 10 of 2010 dated 27.02.2010. From time to time, several Notiﬁ cations were issued increasing rate of duty for ‘chewing tobacco’ , unmanufactured 625 tobacco. Notiﬁ cation No. 4 of 2015 dated 01.03.2015 was issued notifying the deemed capacity of production per packing machine per month, on the same day on which Notiﬁ cation No. 5/2015 was issued. Subsequently, by Notiﬁ cation No. 25/2015 dated 30.04.2015 came to be issued under which the rate of duty per packing machine per month was notiﬁ ed which was based on packing speed. The diﬀ erential duty between ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ was not only vast but also huge. The following table is the mirror to this fact: Period ‘Chewing Tobacco’ ‘Zarda/ Jarda Scented Tobacco’ Relevant Notiﬁ cation P r i o r t o 01.03.2015 Same Same w.e.f. 01.03.2015 38.64 lakhs per packing machine per month 27.05 lakhs per packing machine per month N o t i f i c a t i o n No. 04/2015- CE (N.T.) dt. 01.03.2015 w.e.f. 30.04.2015 38.64 lakhs per packing machine per month 82.11 lakhs per packing machine per month Notification No. 25/2015 CE dated 30.04.2015 86. Hence, the assessee who had taken a stand by its communication dated 18.03.2015 was manufacturing ‘zarda/jarda scented tobacco’ changed its version and started contending the product ma nufactured by it is ‘chewing tobacco’ . The assessee was changing the classiﬁ cation of its product, as the central excise duty on ‘zarda/jarda scented tobacco’ and ‘chewing tobacco’ was changing. The view taken by adjudicating authority is based on factual evaluation which derives i ts support from the CRCL Report which conﬁ rmed that the samples drawn has the same ingredients as that of ‘zarda/jarda scented tobacco’ and thereby rightly conﬁ rmed the duty demanded under the Show Cause Notice. The ﬁ ndings recorded by us in Group No. 1 in matter of M/s Urmin Products with regard to classiﬁ cation would squarely be applicable to the facts on hand and as such both these appeals deserved to be allowed by setting aside the impugned order of the tribunal. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] IV . M/S DHARAMPAL PREMCHAND LTD. V . COMMISSIONER OF CENTRAL EXCISE - CA NO.2469 OF 2020, DIARY NO.3492, 3487, 2810, 3484, 3513, 3536, 3544, 3545 AND 3547 OF 2020 BRIEF FACTS 87. The assessee is in appeal before this Court assailing the common impugned Final Order dated 06.01.2019 passed by CESTAT, Allahabad. At the outset, we would like to state that the ﬁ ndings recorded and observations made under the present group of appeals are conﬁ ned to this group only. The period of dispute involved in these appeals relates to May 201 5 to January 2016. 88. The declarations ﬁ led by the assessee classifying their product as ‘Chewing Tobacco’ were approved by orders passed by the Deputy Commissioner upto 23.09.2015 though a higher rate had been prescribed for ‘zarda/jarda scented tobacco’ vide Notiﬁ cation No.25/2015 dated 30.04.2015. The Deputy Commissioner thereafter vide Order dated 13.01.2016 amended assessee’s declaration dated 08.01.201 6, wherein assessee classiﬁ ed the product as CET SH 24039910 i.e., ‘chewing tobacco’, and Deputy Commissioner reclassiﬁ ed it to CET SH 2403 9930 i.e., ‘zarda/ jarda scented tobacco’, w.e.f. 16.01.2016. The Deputy Commissioner in his Order dated 13.01.2016 justiﬁ ed the reclassiﬁ cation on account of discovery of the fact that similar manufacturer i.e, M/s Dharampal Satyapal was manufacturing the same product with identical manufacturing process and classifying the product as ‘zarda/jarda scented tobacco’ . Subsequent order came to be passed on 17.02.2016 correcting the next declaration dated 11.02.2016 w.e.f. 18.02.2016, after aﬀ ording a personal hearing. 89. The Revenue had also issued two show cause notices pertaining to the goods manufactured at two diﬀ erent factories of the assessee. Show cause dated 04.05.2016 was issued for the factory located at 1D, A-34/35, Sector 60, NOIDA (hereinafter referred to as “1D factory” ) and show cause notice of same date was also issued for the factory located at 6A, A-34/35, Sector 60, NOIDA (hereinafter referred to as “6A factory” ). An Addendum dated 09.02.2016 was made to the show cause notices wherein reliance on CRCL reports were placed regarding the characteristics of the product. Under both the show cause notices, diﬀ erential duty for the period May 2015 to January 2016 which was short paid on the ground of misdeclaration 627 was demanded along with interest, and penalty. The reclassiﬁ cation and the demand proposed in the Notices were conﬁ rmed by the Commissioner by OIO on 28.11.2017 and 29.11.2017 respectively. These orders were challenged before the High Court of Allahabad in Writ Tax No. 232/2018 and Writ Tax No. 234/2018, which came to be dismissed on the ground that the petitioner has alternate remedy. The SLP No. 7369/2018 challenging the order dated 26.02.2018 passed in Writ Tax No. 232/2018 also came to be dismissed. Hence the assessee preferred Appeal No. 70437/2 018 and 70438/2018 before CESTAT, which came to be rejected by Final Order No. A/71893-94/2019-EX (DB) dated 06.11.2019. 90. Hence, the present appeals came to be ﬁ led by assessee before the Tribunal in respect of: a. The adjudication orders in the show cause notices dated 04.05.2016. b. The appellate orders conﬁ rming the amendments ma de to the declarations on and after 08.01.2016 from ‘chewing tobacco’ to ‘zarda/ jarda scented tobacco’. c. A refund claim made in respect of duty paid in February 2016 under protest after the declaration was modiﬁ ed. d. Abatement/ refund granted but appropriated towards payment of duty. 91. The dispute in all these appeals revolved around the classiﬁ cation of the impugned product. The tribunal by common order dated 06.11.2019 dismissed the appeals and upheld the orders impugned before it. 92. Being aggrieved by the order of the tribunal dated 06.11.2019 these appeals have been ﬁ led. SUBMISSIONS OF THE PARTIES 93. The thrust of the arguments canvassed by Mr. S.K Bagaria, learned Senior Counsel appearing for the appellant/assessee is: the original authority had acted beyond the jurisdiction and travelled beyond the powers vested under Rule 6 of the CTPM Rules, 2010. He would also contend that the issue of classiﬁ cation of a product cannot be the subject matter of adjudication in an order passed under Rule 6(2) of CTPM Rules. He would contend that COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] when the issue of classiﬁ cation of a product arises, the initial burden is on the Department/Revenue, and it can be contested by the assessee and thereafter the dispute is to be adjudicated by following the principles of natural justice. He has submitted that these aspects though urged before the tribuna l, had been completely ignored and as such impugned orders are required to be set aside by this Court. 94. He would elaborate his submissions by contending that the issue of classiﬁ cation is an independent issue in itself and no decision on the classiﬁ cation can be taken in a matter concerning the approval of declaration under Rule 6 of the CTPM Rules. He would also contend that the description of a product as declared under the declaration ﬁ led under Rule 6 cannot be changed by the Revenue when the product has been sold and marketed under a particular heading. He would contend that under the CETA, there is no deﬁ nition of ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ and therefore the test lies in the market understanding of the p roduct and the same would prevail. He would further contend that under Rule 6 of CTPM Rules, the authority would only consider the number of machines installed in the factory and production capacity of the same and it was not open to him to examine the correct classiﬁ cation of the product. In support of his submissions, he has relied upon the following judgments: (i) ITC Ltd. v. Commissioner (2019) 17 SCC 46. (ii) HPL Chemicals Ltd. v. CCE, Chandigarh 2006 (197) ELT 324 [SC] (iii) Mauri Yeast India Pvt. Ltd. v. State of U.P. 2008 (225) ELT 321 [SC] (iv) CCE Nagpur v. Shree Baidyanath Ayurved Bhawan 2009 (237) ELT 225 [SC] (v) W.P.I.L. Ltd. v. CCE 2005 (181) ELT 359 [SC] (vi) Mathuram v. State of M.P. (1999) 8 SCC 667 (vii) CC v. Dilip Kumar and Company (2018) 9 SCC 1 (viii) Indo International Industries v. CGST (1981) 2 SCC (ix) UOI v. Delhi Cloth and General Mills Co. Ltd. 1963 Supply (1) SCR 586 629 95. M/s. Nisha Bagchi, learned counsel for the Revenue would contend that the declaration ﬁ led by the assessee classifying their product as 2403 9910 was approved and orders were passed by the Deputy Commissioner upto 23.09.2015 though a higher rate had been prescri bed for ‘zarda/ jarda scented tobacco’ by Notiﬁ cation No.25 of 2015 dated 30.04.2015 which product was manufactured by the assessee. She would contend that ‘zarda/jarda scented tobacco’ was notiﬁ ed under Section 3A of CE Act, vide Notiﬁ cation No.17 of 2010 dated 13.04.2010 and by N otiﬁ cation No.18 of 2010 dated 13.04.2010, the CTPM Rules were amended to cover ‘zarda/jarda scented tobacco’ . She would contend that the declarations ﬁ led by the assessee were determined and/ or adjudicated after aﬀ ording a personal hearing and by relying upon the admission/statement made by the General Manager of the assessee during the personal hea ring, the Deputy Commissioner has modiﬁ ed all subsequent declarations which came to be conﬁ rmed by the appellate authority. She would also place reliance upon the CRCL report to contend that the samples drawn from on e of the units had a pleasant odour/fragrance. She would draw the attention of the Court to the ﬁ ndings recorded by the tribunal which is to the eﬀ ect that the use of saﬀ ron and scented ﬂ avour in the manufacture of the product had been admitted by the General Manager; and, one unit of the same group was manufacturing an identical product which was being class iﬁ ed as ‘zarda/ jarda scented tobacco’ and both these products had the same brand name and was entering the market as the same product. She would also contend that the appellant had not contested that manufacturing process which was identical and both products were marketed under the same brand name. She would also submit that the classiﬁ cation of the product ought to have been under CET SH 2403 9930 and there cannot be estoppel in taxation matters for rectifying the past erroneous classiﬁ cation/ de claration which was approved pursuant to intentional misdeclaration and wilful suppression. To conclude her arguments, she would submit that the adjudicating authority and the tribunal have considered the factual matrix and ar rived at a well- reasoned conclusion based on the characteristics of the product, the test reports applying the commercial parlance, admission of t he assessee, and the deﬁ nitions found in IS glossary and existing prece dents. Hence, by relying upon the following Judgments she has sought for dismissal of the appeals: COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] (i) CCE v. Cotspun (1999) 7 SCC 633 (Para 14, 15) (ii) Vivek Narayan Sharma v. Union of India 2023 (3) SCC1 (iii) Hindustan Poles Corpn. v. CCE (2006) 4 SCC 85 (iv) Mishra Zarda Traders v. State of Orissa 1987 SCC Online 363 (v) Swiss Ribbons Pvt. Ltd. v. Union of India (2019) 4 SCC17 ISSUES FOR CONSIDERATION 96. Having heard the learned advocates appearing for the parties and after bestowing our anxious consideration to the rival contentions raised at the bar the following points/questions would arise for our consideration: (1) What is the purpose of the declaration ﬁ led under Rule 6 of CTPM Rules? (2) What are the parameters which are required to be examined, determined, and adjudicated under Rule 6 by the Prescribed Authority? (3) Whether the Prescribed Authority have the power and jurisdiction to determine the classiﬁ cation or speciﬁ c entry within which the declared product is to be classiﬁ ed? OR Whether the issue of classiﬁ cation of a product can be the subject matter of adjudication/decision under Rule 6(2) of CTPM Rules? (4) Whether a declaration made under Rule 6 has any nexus to the classiﬁ cation of the product and on account of the classiﬁ cation of such declaration, would preclude the Department from issuing a Notice under Section 11A or 11AC of CE Act, 1944? DISCUSSION AND FINDINGS 97. While adjudicating the above questions/points, the answer to one is likely to overlap with the other and as such we propose to adjudicate these questions together and we propose to answer them accordingly and record conclusion question or point-wise. 98. For undertaking the aforesaid exercise, it would be necessary to examine the applicable rules in question i.e., ‘Chewing Tobacco’ and 631 Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010. The aforesaid rules came to be notiﬁ ed by Notiﬁ cation No.11 of 2010 dated 27.02.2010 which came into force from 08.03.2010. The aforesaid rules were made applicable to the goods speciﬁ ed and notiﬁ ed as per Section 3A. ‘Chewing tobacco’ was notiﬁ ed under Section 3A by Notiﬁ cation No.10 of 2010 dated 27.02.2010 and ‘zarda/jarda scented tobacco’ was speciﬁ ed as notiﬁ ed goods under Section 3A of CE Act, 1944 by Notiﬁ cation No.17 of 2010 dated 13.04.2010 on the same day i.e. 13.04.2010 Notiﬁ cation No.18 of 2010 came to be issued amending the CTPM Rules, 2010 to cover zarda/jarda scented tobacco. 99. The aforesaid rules to the extent it require adjudication of the points/questions formulated hereinabove would necessarily be required to be extracted and Rule 6 which would have direct bearing on the points formulated hereinabove is extracted herein below for immediate reference and it reads: “Rule 6. Declaration to be filed by the manufacturer. - (1) A manufacturer of notiﬁ ed goods shall, immediately on coming into force of these rules, and not later than 8th March, 2010, declare in Form 1 annexed to these rules, (i) the number of single-track packing machines available in his factory; (ii) the number of packing machines out of (i), which are installed in his factory; (iii) the number of packing machines out of (i), which he intends to operate in his factory for production of pouches of notiﬁ ed goods with lime tube and without lime tube, respectively, with eﬀ ect from the 8th day of March, 2010; (iv) the number of multiple track or multiple line pack ing machine available in his factory; (v) the number of multiple track or multiple line packing machines out of (iv), which are installed in his factory; (vi) the number of multiple track or multiple line packing machines out of (iv), which he intends to operate in his factory for production of pouches of notiﬁ ed goods without lime tube and with lime tube, respectively, with eﬀ ect from the 8th day of March, 2010; COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] (vii) the name of the manufacturer of each of the packing machine, its identiﬁ cation number, date of its purchase and the maximum packing speed at which they can be operated for packing of pouches of notiﬁ ed goods, with lime tube and without lime tube, of various retail sale prices; (viii) description of goods to be manufactured including whethe r unmanufactured tobacco or chewing tobacco or both, their brand names, whether pouches shall contain lime tube or not; (ix) denomination of retail sale prices of the pouches to be manufactured during the ﬁ nancial year; (x) the plan and details of the part or section of the factory premises intended to be used by him for the manufacture of notiﬁ ed goods of diﬀ erent denomination of retail sale prices and the number of machines intended to be used by him in each such part or section, to the jurisdictional Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, with a copy to the jurisdictional Superintendent of Central Excise : Provided that a new manufacturer shall ﬁ le such declaration at least seven days prior to the commencement of commercial production of notiﬁ ed goods in his factory. (2) On receipt of the declaration referred to in sub-rule (1), the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, shall, after ma king such inquiry as may be necessary including physical verification, ap prove the declaration and determine and pass order concerning the annual capacity of production of the factory within three working days in accordance with the provisions of these rules. Provided that the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, may direct for modiﬁ cations in the plan or details of the p art or section of the factory premises intended to be used by the m anufacturer for manufacture of notiﬁ ed goods of diﬀ erent retail sale prices, as he thinks proper, for eﬀ ective segregation of the parts or sections of the premises and the machines to be used in such parts or sections before granting the approval : 633 Provided further that if the manufacturer does not receive the approval in respect of his declaration within the said period of three working days, the approval shall be deemed to have been granted subject to the modiﬁ cations, if any, which the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, may communicate later on but not later than thirty days of ﬁ ling of the declaration.” 100. A perusal of the above rule would indicate that the manufacturer of notiﬁ ed goods should immediately on coming into force of the Rules (08.03.2010) ﬁ le a declaration in Form No.1 declaring the details of notiﬁ ed goods as prescribed or speciﬁ ed under sub-rule (i) to (x) and on receipt of such declaration the jurisdictional Deputy Commissioner or the Assi stant Commissioner of Central Excise, namely, the Competent Authority, would approve the declaration and determine and pass orders concerning the annual capacity within three working days after making such inquiry as may b e necessary including physical veriﬁ cation. The ﬁ rst proviso to Rule 6 of CTPM mandates that the authorised oﬃ cer may direct modiﬁ cations of the details as prescribed thereunder. The perusal of the second proviso would indicate that if the manufacturer does not receive the approval in respect of his declaration within the said period of 3 working days, the approval shall be deemed to have been granted subject to the modiﬁ cations, if any, which the authorised oﬃ cer as the case may communicate not later than 30 days of the ﬁ ling of such declaration. 101. Learned counsel appearing for the assessee has raised a contention that since the classiﬁ cation of the product being disputed by the Revenue, the burden lies upon the Department and it is beyond the scope of Rule 6(2) and suggested change of classiﬁ cation whilst adjudicating a dec laration made under Rule 6 can only be by the issuance of a Notice or otherwise, it would be foul of natural justice. The said argument howsoever attra ctive cannot be accepted for the simple reason that sub-rule (2) of Rule 6 would clearly indicate that on receipt of a declaration referred to in sub-rule (1), the Competent Authority would be required to make such inquiry as may be necessary including physical veriﬁ cation by determining the correctness or otherwise of such declaration concerning the annual capacity of production COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] of the factory. The nomenclature of the Rule would itself indicate that the said Rule is called as “Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity, determination and collection of duty) Rules, 2010” . A combined reading of clause (i) to (x) of sub-rule (1) of Rule 6 would indicate during the inquiry contemplated under sub-rule (2), the adjudicating authority would be determining the annual capacity production of the factory and the Competent Authority would be required to take into consideration the details of the track packing machines installed in the factory, the number of packing machines which are available and the assessee intending to operate in his factory, number of multiple tracks or multiple line packing machines available and to be used or operated with and without lime tube. The maximum packing speed of such machines, various retail sale prices, description of goods to be manufactured including whether ‘unmanufactured tobacco’ or ‘chewing tobacco’ or both, and whether pouches contain lime tube or not, details of said products, are to be determined. In the process of undertaking such an exercise, the Competent Authority would be required to necessarily examine as to whether the product in question would fall within the classiﬁ cation of notiﬁ ed goods, inasmuch as the product has to necessarily fall within the notiﬁ ed goods as notiﬁ ed under sub-section (1) of Section 3A and for the relevant period. 102. The Form of declaration that has been prescribed under Rule 6 is Form No. 1 and such declaration ought to contain the details speciﬁ ed thereunder. For the purposes of clarity and brevity we deem it appropriate to extract the Form No.1 as prescribed under Rule 6 herein below: “FORM - 1 [See rule 6] (1) Name of the manufacturer : (2) Address of the manufacturing premise : (3) ECC No: (4) Address of other premises manufacturing the same products : (5) Number of single track packing machines available in the factory : (6) Number of packing machines out of (5), which are installed in the factory : 635 (7) Number of packing machines out of (5), which the manufacturer intends to operate in his factory for production of pouches of notiﬁ ed goods with lime tube and without lime tube, respectively : (8) Number of multiple track or multiple line packi ng machine available in the factory : (9) Number of multiple track or multiple line packing machines out of (8), which are installed in the factory : (10) Number of multiple track or multiple line packing machines out of (8), which the manufacturer intends to operate in his factory for production of pouches of notiﬁ ed goods with lime tube and without lime tube, respectively : (11) Name of the manufacturer of each of the packing machine, it s identiﬁ cation number, date of its purchase and the maximum packing speed at which the machines can be operated for packing of notiﬁ ed goods, with lime tube and without lime tube, of various retail sal e prices : (12) Description of goods to be manufactured including whether unmanufactured tobacco or chewing tobacco or both, their bra nd names, whether pouches shall contain lime tube or not, and other concerned details : (13) Denomination of retail sale prices of the pouc hes to be manufactured during the ﬁ nancial year : (14) The ground plan and details of the part or section of the factory premises intended to be used by him for manufacture of notiﬁ e d goods of diﬀ erent denomination of retail sale prices and the number of machines intended to be used by him in each of such part or section : (15) Declaration (a) I/We further declare that the particulars furnished above are true and correct in all respects. In case any particulars are found to be untrue/ incorrect, I/We undertake to pay any additional amount of excise duty on notiﬁ ed goods manufactured by me/us as per provisions of the Central Excise Act, 1944 (1 of 1944) or the rules made or notiﬁ cations issued thereunder. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] (b) I/We further undertake that any addition or rem oval of the packing machine would be done under the physical supervision of the Central Excise Oﬃ cer as per the procedure provided in the Chewing Tobacco and unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010. (c) I/We hereby agree to abide by the provisions and conditions of the Chewing Tobacco and unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010. Place: Date: Name, residential address and signature of manufacturer/authorised agent” 103. ‘Chewing tobacco’ and preparations containing ‘chewing tobacco’ was found in Entry CETH 2404.41 by virtue of Notiﬁ cation No.13 of 2006 dated 01.03.2002 and it was covered under MRP-based assessment under Section 4A of CE Act. On the advent of 8 (eight) digit tariﬀ regime ‘zarda/ jarda scented tobacco’ was introduced under a separate head under ‘CET SH 2403 9930’ and ‘chewing tobacco’ under the head ‘CET SH 2403 9910’ with eﬀ ect from 28.02.2005. However, Notiﬁ cation No.2 of 2006 which was issued in supersession of Notiﬁ cation No.13 of 2002 ‘zarda/jarda scented tobacco’ was deleted or, in other words, such Entry was omitted. 104. In the light of the two products having been notiﬁ ed under Section 3A as ‘notiﬁ ed goods’ which is contemplated under Rule 2(c), it cannot be gainsaid by the assessee that while adjudicating the declarat ion ﬁ led, the issue of classiﬁ cation would not fall within the domain of the adjudicating authority under Rule 6(2). In the event, that there has been improper classiﬁ cation of the notiﬁ ed goods the adjudicating authority would be empowered to rectify the misclassiﬁ cation, all the more, in a situation where it has been misclassiﬁ ed with an intention to evade a higher rate of duty. It is in the teeth of the same, that the expression “inquire, determine and pass order” will acquire great signiﬁ cance under Rule 2(c). The declaration which is required to be ﬁ led under Rule 6(1) by a manufacturer is of “notiﬁ ed goods” . The said notiﬁ ed goods means as deﬁ ned under Rule 2(c) which reads as under: 637 “(c) “notiﬁ ed goods” means unmanufactured tobacco, bearing a brand name, and chewing tobacco notiﬁ ed under sub-section (1) of section 3A of the Act by the notiﬁ cation of the Government of India in the Ministry of Finance (Department of Revenue), No. 10/2010-Central Excise (N.T.), dated the 27th February, 2010;” 105. From time to time, the notiﬁ ed goods came to be included or excluded, which power vested with the rule-making authority and there cannot be any quarrel on this proposition. The product zarda/jarda scented tobacco , as noticed herein (supra) came to be notiﬁ ed under Section 3A (1) of CE Act, 1994, with eﬀ ect from 13.04.2010 and correspondingly the CTPM Rules also came to be amended to cover zarda/jarda scented tobacco. As such the assessee contended that the adjudicating authority would not be within his powers to determine the classiﬁ cation. 106. A holistic reading of Rule 6 would indicate th at the details prescribed thereunder alone would be the subject matter of det ermination concerning the annual capacity of production of the factory. The sec ond proviso to Rule 6 would clearly indicate that the Prescri bed Authority is empowered to modify the declaration on the facts obtained fr om such declaration. While undertaking such exercise of determination and passing orders concerning the annual capacity of production of the factory as contemplated under sub-rule (2) of Rule 6, the Prescribed Authority would have to take into consideration the issue relating to the classiﬁ cation of the product. We say so for reasons more than one, ﬁ rstly, the details required to be furnished as prescribed under clause (i) to (x) of sub-rule (1) of Rule 6 would indicate that apart from details mentioned therein, the decla rant will have to specify the description of goods to be manufactured without specifying the classiﬁ cation entry to the Central Excise Tarif Act. On the basis of such declaration ﬁ led by the assessee, the duty for a particular month has to be calculated by application of the appropriate rate of duty speciﬁ ed in the notiﬁ cation as indicated under Rul e 7. Necessarily to ascertain the duty payable, the issue of classiﬁ cation will have to be gone into in an inquiry held under sub-rule (2) of Rule 6, as otherwise the inquiry contemplated would become redundant or meaningless. Secondly, to calculate the duty of the product, the condition precedent is the capacity of the production. Thus, it becomes important to ascertain the capac ity of COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] production ﬁ rst, which can only be done when the concerned authority is acquainted with the product as described which would ultimately assist the Competent Authority to classify the product under the appropriate ta riﬀ head as provided under CETA. Thirdly, the rationale behind Rule 6(2) is that, unless there is proper classiﬁ cation of the product, the Competent Authority would not be in a position to ascertain the correct classiﬁ cation under the tariﬀ head and consequently would not be able to determine the annual capacity of the production of the notiﬁ ed goods, which may lea d to improper calculation. This is more so, for every notiﬁ ed product may not possess similar ingredients as that of the other product. It is trite law that changes in the ingredient of a product can bring about change in t he production capacity, namely, aﬀ ect the manufacturing process. Thus, in the event of mis-description, wrong description or erroneous description or intentional improper classiﬁ cation of the product manufactured would not tie the hands of the Competent Authority from piercing the corporate veil to ascertain the true nature of the product and reclassify the same, necessarily after aﬀ ording an opportunity of hearing which would be in compliance of the doctrine of natural justice. The object sought to be achieved by this Rule is to empower the Department to determine the annual capacit y based on the declaration of the assessee and such declaration would not be required to be accepted in the event of there being an improper descript ion of the goods or product in the declaration so ﬁ led. In fact, declaration Form No.1 itself would indicate that in column No.15A, the declarant has agree d to bind itself to pay any additional amount of excise duty on notiﬁ ed goods manufactured by it by such declaration, if found to be untrue or incorrect. This undertaking would reinforce the fact that even in case of ac ceptance of such declaration by the Competent Authority, it does not preclude them thereafter to demand the diﬀ erential duty on account of short demand to recover such duty, and necessarily complying with the principles of natural justice. 107. As noticed hereinabove both the parties have relied upon the judgment of this Court in CCE V. Cotspun (supra) whereunder this Court has held that once there is the levy of excise duty on the basis of an approved classiﬁ cation list, until the correctness of the approval of the question by issuance of a show cause notice to the assessee, same cannot be disturbed. It has been further held that levy of excise duty on the basis of an approved 639 notiﬁ cation is not a short levy. It was also held that diﬀ erential duty cannot be recovered on the basis that it is a short levy and revised assessment could be made eﬀ ective prospectively from the date of the show cause notice and not with reference to earlier removals made under an approved classiﬁ cation list. In this background, it came to be held that as long as c lassiﬁ cation list subsists, the diﬀ erential duty cannot be claimed on the same product. 108. It has to be noticed that in Cotspun (supra) the assessee was manufacturing NES Yarn and the classification list was filed by the manufacturer as required under Rule 173-B of the Central Excise Rules, 1944 and same had been approved by the Competent Authority and it was accordingly classiﬁ ed under old Tariﬀ Item No.19-I(2)(a) and (2)(e). Notice to reopen the assessment for the period February 1977 to May 1977 w as issued on the ground that the NES Yarn ought to have been classiﬁ ed under old Tariﬀ Item No.19-I(2)(f) and the diﬀ erential duty was demanded. This was followed by a second show cause notice and subsequently amended by corrigendum. The adjudicating authority upheld the contention of the assessee by arriving at a conclusion that duty liability had been ascertained based on an approved classiﬁ cation list, and the question of short levy did not arise. However, the appellate authority allowed the appeal and conﬁ rmed the demand. On appeal, the tribunal held the revised assessment could be made eﬀ ective only prospectively, namely, from the date of show cause notice, not earlier. This Court took note of the fact that the as sessee was required to ﬁ le before the appropriate Excise Oﬃ cer, for approval, a list of the goods that he proposes to clear and the said list indicated that details to be found in such approval list ﬁ led before the Appropriate Authority which not only include the description of the goods produced or manufactured by the declarant but also provided the tariﬀ entry under which the goods that the declarant intends to remove would fall and the rate of duty leviab le thereon, apart from other particulars, as prescribed under sub-rule (2) of Rule 173-B. It is these details which had been furnished by the assessee in Cotspun’s case (supra) which had been accepted and while justifying its demand of reclassiﬁ cation, would operate retrospectively by relying upon Rule 10 of the Central Excise Rule, 1944, which is similar to the contention raised in the present case. However, this contention did not ﬁ nd favour by this Court on the ground that Rule 173-B dealt with the classiﬁ cation list and Proper Oﬃ cer ought to have made inquiry and approve the list with such COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] modiﬁ cations as was considered necessary, after such inquiry, as he deems ﬁ t, unless otherwise directed by the Proper Oﬃ cer, determine the duty payable on the goods intended to be removed in accordance with such list vide sub- rule (2) of Rule 173-B. Whereas the corresponding Rule 6 in the inst ant case does not indicate or remotely suggest declaration of such classiﬁ cation is required to be made. However, Rule 6(2) only prescribes the description of the goods to be speciﬁ ed by the declarant in his declaration. Hence, this would result in casting additional onerous responsibility on the Competent Authority to undertake the exercise of ascertaining as to the nature of the goods and its classiﬁ cation under CETA for proper determination of production capacity of the machine. It would also be apposite to note the judgment of this Court in CCE v. Srivallabh Glass Works Ltd. (2003) 11 SCC 341 whereunder the Cotspun’s case (supra) was distinguished on facts and held that Cotspun’s case ( supra ) only lays down that so far as classiﬁ cation list subsists, the diﬀ erential duty cannot be claimed on the same product mentioned in the classiﬁ cation list, however, if the product being cleared is diﬀ erent from the one mentioned in the classiﬁ cation list, the principles enunciated in Cotspun’s case (supra) would not be applicable. In that view of the matter, we are of the considered view that the Revenue has the power and jurisdiction to determine the classiﬁ cation for speciﬁ c Entry within which the product is to be declared or classiﬁ ed and the issue of classiﬁ cation can be the subject matter of adjudication/ decision under sub-rule (2). A declaration made under Rule 6 resulting in the determination and passing of the order under sub-rule (2) of Rule 6 would not preclude the Department or Revenue from issuing notice under Section 11A or Section 11AC of CE Act where there is wilful misstatement or suppression of fact leading to what levy or non-levy of the duty. 109. In the instant case, the declaration conﬁ ned to ‘chewing tobacco’ falling under CET SH 2403 9910. However, during the course of such inquiry, the Competent Authority would be competent to examine as to whether the product would fall within the notiﬁ ed goods. In the instant case, ‘zarda/jarda scented tobacco’ was speciﬁ ed as notiﬁ ed goods under Section 3A by Notiﬁ cation No.17 of 2010 dated 13.04.2010 and the CTPM Rules also correspondingly had been amended on the same day i.e., 13.04.2010 by Notiﬁ cation No.18 of 2010. Thus, taking into within its sweep the said ‘notiﬁ ed goods’ as deﬁ ned under Rule 2(c) of CTPM Rules for the purposes 641 of classiﬁ cation and this exercise undertaken by the Competent Authority cannot be found fault with. Hence, we record our ﬁ nding on the questions formulated hereinabove as under: (1) What is the purpose of the declaration ﬁ led under Rule 6 of CTPM Rules? ANSWER: To ascertain the details of the product to be manufactured and the nature of the product for purposes of ﬁ xing the packing capacity of the machine and determine the duty. (2) What are the parameters which are required to be examined, determined, and adjudicated under Rule 6 by the Prescribed Authority? ANSWER: To inquire and determine the correctness of the details furnished under the declaration, namely, Form No.1. (3) Whether the Competent Authority have the power and jurisdiction to determine the classiﬁ cation or speciﬁ c entry with in which the declared product is to be classiﬁ ed? OR Whether the issue of classiﬁ cation of a product can be the subject matter of adjudication/decision under Rule 6(2) of CTPM Rules? ANSWER: Yes. (4) Whether a declaration made under Rule 6 has any nexus to the classiﬁ cation of the product? ANSWER: Yes, for the purpose of determining the packing capacity and corresponding duty. (5) Whether on account of classiﬁ cation by such declaration, would preclude the Department from issuing a Notice under Section 11A or 11AC of CE Act, 1944? ANSWER: No, if there is improper or misdeclaration or improper declaration. 110. In the light of the ﬁ ndings recorded herein above, we are of the considered view that the impugned orders of the tribunal would not be sustainable and the order of the adjudicating authority deserves to be COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] upheld, consequently these appeals deserves to be allowed, except Civil Appeal arising out of Diary No. 3487 of 2020 which is directed against the order dated 06.11.2019 passed by the CESTAT in Excise Appeal No. 70242 of 2018., which stand on a diﬀ erent footing and hence the said appeal is taken up for consideration and disposed of by the following order. 111. The appellant-assessee ﬁ led an abatement claim amounting to Rs. 1,99,41,935/- before the Deputy/Assistant Commissioner, Central Excise, Division-II, Noida under Rule 10 of CTPM Rules. The said claim was adjudicated and by order dated 30.3.2016 was allowed. However, under the very same order the said amount which was allowed to be distributed to the assessee by cash was ordered to be appropriated under Rule 9 of CTPM Rules read with Section 11 of CE Act. 112. Being aggrieved by the aforesaid order, an appeal came to be ﬁ led before the Commissioner who by order dated 31.08.2017 upheld the order-in-original dated 30.03.2016 to the extent of appropriation of central excise duty of Rs.1,82,56,000/- and set aside to the extent of interest of Rs.18,59,042/ levied. 113. Being aggrieved by the same, appeal was ﬁ led before the CESTAT in Excise Appeal No.70242 of 2018 contending before the tribunal that the order of the Deputy Commissioner dated 30.03.2016 is in violation of natural justice, namely, in the grounds of appeal before this Court it has been urged the impugned order passed by the tribunal it had failed to address the issue of abatement of Rs. 1,96,67,556/-. On perusal of the case papers and after hearing the learned advocates appearing for the parties, we notice that the tribunal has failed to examine this issue. Hence, on the short ground of tribunal having not examined this issue, the appeal deserves to be allowed. Accordingly, Civil Appeal arising out of Diary No. 3487 of 2020 is allowed and the matter is remitted to the tribunal for adj udication de novo on merits. We have not expressed any opinion on merits, and contentions of both the parties on the issue of abatement is kept open. V . COMMISSIONER OF CENTRAL GOODS AND SERVICE TAX V . M/S TEJ RAM DHARAM PAUL - CIVIL APPEAL NO. 3596 OF 2023 643 BRIEF FACTS 114. The period of dispute in this group is May 2015 to December 2015. The assessee claims the product to be classiﬁ ed under CET SH 2403 9910 i.e., ‘chewing tobacco’ , whereas the Revenue contends that the product ought to have been classiﬁ ed under CET SH 2403 9930 i.e., ‘zarda/jarda scented tobacco’ . Coming to the facts of this appeal, the assessee submitted Form No.1 before the jurisdictional Central Excise Division declaring that they would manufacture ‘Mahapasand Zarda/Jarda Scented Tobacco’ and paid duty accordingly for the period from 10.03.2015 to 31.03.2015. Thereafter, Form No.2 was submitted by the assessee, and duty was paid on ‘Zarda/Jarda Scented Tobacco’ . The Revenue drew samples of the product on 13.03.2015 and forwarded the same to the CRCL who by its report dated 23.03.2015 classiﬁ ed the product as ‘chewing tobacco’ . Accordingly, the assessee was informed on 27.04.2015 that the product is to be classiﬁ ed as ‘chewing tobacco’. 115. Accordingly, the appellant-assessee submitted revised Form No.1 on 23.05.2015 and informed that they would manufacture ‘chewing tobacco’ . Notiﬁ cation No.25 of 2015 which came into eﬀ ect from 30.04.2015 under which the rate of duty for packing machine per month was notiﬁ ed on 1.03.2015. Hence, the Department drew fresh samples under Panchnama dated 29.05.2015 and forwarded the same to CRCL for obtaining the report. The CRCL forwarded the report on 20.07.2015 without classifying the product. On being asked to classify the tariﬀ entry by the Reven ue, the Chemical Examiner vide communication dated 27.07.2015 refused to do so stating “assessing oﬃ cers at various levels should not ask the Deputy Chief Chemist/Chemical Examiner to give the tariﬀ classiﬁ cation”, citing para 70 (B) and (C) of manual of the Revenue Laboratories. Thereaft er, on 04.12.2015 Revenue visited the premises of the assessee again and took samples which came to be recorded in Panchnama and forwarded the same to CRCL for fresh reports. In the meanwhile, the Competent Authority passed the capacity determination order on 18.12.2015 under Rule 6(2) of CTPM Rules holding that the product manufactured by the appellant-assessee for the period from May 2015 to December 2015 is ‘zarda/jarda scented tobacco’. On 21.12.2015 assessee was called upon to deposit diﬀ erential duty along with interest and same was deposited under protest. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 116. On 01.07.2016 a show cause notice was issued d emanding duty, interest, and penalty under Section 11A, 11AA, and 11AC read with relevant Rules which came to be adjudicated by OIO dated 18.03.2021 whereunder the demand made under the show cause notice was aﬃ rmed. In the interregnum, the assessee challenged the capacity determi nation order No.24 of 2015 dated 18.12.2015 before the Commissioner (Appeal-I) who dismissed the appeal on the ground that it was premature as the issue relating to the classiﬁ cation was pending since the show cause notice dated 01.07.2016 had already been issued and it was yet to be decided vide order dated 06.12.2016. Aggrieved by the same an appeal was ﬁ led before the tribunal and tribunal held that issue of classiﬁ cation was open and it was to be decided by the adjudicating authority. Subsequently, OIO came to be passed on 18.03.2021, conﬁ rming the duty demand and further ordered for appropriation of the amount speciﬁ ed thereunder, apart from imposing of penalty. Being aggrieved by the same, appeal was ﬁ led before the tribunal which came to be allowed and the order dated 18.03.2021 was set as ide. Hence, this appeal by the Revenue. SUBMISSIONS OF THE PARTIES 117. Ms. Nisha Bagchi, the learned counsel for the Revenue, criticized the tribunal’s decision, arguing that it did not examine the deﬁ nitions in the IS glossary and ignored the CRCL report dated 14.12.2015. She argued that adding scent to Zarda would change the product’s character to ‘zarda/ jarda scented tobacco’ . Ms. Bagchi also cited the assessee’s representative’s statements and the fact that the product was previo usly classiﬁ ed as ‘Mahapasand zarda/jarda scented tobaccot ’ for March and April 2015 but was later changed to ‘Mahapasand chewing tobacco (without lime tube)’ for May 2015 to December 2015. Ms. Bagchi argued that the assessee’ s dual stand at diﬀ erent times depending on the rate of duty the produc t attracted was evident in Notiﬁ cation No.25 of 2015, which ﬁ xed the duty per packing machine/per month. In reply, Mr. S.K. Bagaria, learned Senior Counsel appearing for the appellant-assessee has not on ly relied upon the communication dated 27.04.2015 (Annexure A-7) but also the CRCL Report dated 23.03.2015 which would indicate that the consistent stand of the Department itself was that the product manufactured by the assessee is ‘chewing tobacco’ and as such the impugned order of the tribunal would not warrant interference. 645 118. The assessee argued that the Revenue’s assumption that adding certain ﬂ avours to ‘zarda scented tobacco’ is incorrect, as these additives only enhance the taste and assessment of the product as a ‘chewing tobacco’ , and do not change the basic characteristics. It was also conten ded that ‘chewing tobacco’ and ‘zarda/jarda scented tobacco’ having not been deﬁ ned under the statute, the principles of trade parlance must be resorted to, which is its popular meaning and understanding by those people using the product and not scientiﬁ c and technical. The assessee also harped upon the contention that the last report dated 14.12.2015 of the CRCL is an ‘induced opinion’. It was further contended that the Revenue had failed to establish or demonstrate that the product is not ‘chewing tobacco’ and the cross-examination of the Chemical Examiner reﬂ ected that she had failed to substantiate her report as to the basis on which she opined that the product is ‘zarda/jarda scented tobacco’ . Hence, relying upon the following judgments the assessee has sought for the appeal to be dismissed: ‘1. Prabhat Zarda Factory v. Commr. Of Central Excise [2004 (163) ELT 485 (Tri-Delhi) 2. Suresh Enterprises v. Commr. Of Central Excise, de cided on 06.07.2006. 3. Yogesh Associates v. CCE, Surat-II (2005(188) ELT 251 (SC). 4. Gopal Zarda Udyog v. CCE, New Delhi 2005 (188) ELT 251 5. Dharam Pal Satyapal v. CCE New Delhi [2005 (183) ELT 241 (SC).’ DISCUSSION AND FINDINGS 119. Heard the learned counsel appearing for the pa rties and on perusal of the record it would emerge therefrom that the Form No.1 dated 05.03.2015 submitted by the assessee before the jurisdictiona l Central Excises Division, Kundli, it had declared that they were manufactur ing ‘Mahapasand zarda/jarda scented tobacco’ . On 17.03.2015, Form No.2 was submitted by the assessee for the period 10.03.2015 to 31.03.2015, and duty was paid for the said period as per declaration in Form No.1. On 13.05.2015 the Department by Panchnama on the same date, drew samples of the product of the assessee’s product i.e., ‘Mahapasand zarda/jarda scented’ COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] manufactured and forwarded the same to CRCL who by the opinion dated 23.05.2015 opined as under: “TEST REPORT: “The sample is in form of brown coloured dried pieces of vegetable matter. It is a preparation containing tobacco, lime and ﬂ avouri ng agents. It is other than Jarda Scented Tobacco. It has the characteristic of Khaini”. 120. Based on the said report the Department by communication dated 27.04.2015 informed the assessee, the product being manufactured by the assessee is classiﬁ able under Chapter sub-heading 2403 9910 as ‘chewing tobacco (other than ﬁ lter Khaini)’ and as such called upon the assessee- respondent to show cause as to why the Form No.1 dated 05.03.2015 should not be rejected as the product manufactured by the respondent-assessee fell in the category of ‘chewing tobacco (other than ﬁ lter Khaini)’ and not under sub-heading 2403 9930 – ‘zarda/jarda scented tobacco’ . Accordingly, the assessee started submitting Form No.1 declaring the product manufactured by it as ‘chewing tobacco’. This Court has consistently held the common parlance test continues to be one of the determinat ive tests for the classiﬁ cation of a product. In Commissioner of Central Excise v. Shri Baidyanath Ayurved chewing tobacco (2009) 12 SCC 419, this Court has held as under: “49. The primary object of the Excise Act is to raise revenue for which various products are diﬀ erently classiﬁ ed in the new Tariﬀ Act. Resort should, in the circumstances, be had to popular meaning and understanding attached to such products by those using the product and not to be had to the scientiﬁ c and technical meaning of the terms and expressions used. The approach of the consumer or user towards the product, thus, assumes signiﬁ cance. What is important to be seen is how the consumer looks at a product and what is his perception in respect of such product. The user’s understanding is a strong factor in determination of classiﬁ cation of the products. 61. In the matters of classiﬁ cation of goods, the principles that have been followed by the courts—which we endorse—are that there may not be justiﬁ cation for changing the classiﬁ cation without a change 647 in the nature or a change in the use of the product ; something more is required for changing the classiﬁ cation es pecially when the product remains the same. Earlier decision on a n issue inter partes is a cogent factor in the determination of t he same issue. The applicability of maxim res judicata pro veritate accipit ur in the matters of classiﬁ cation of goods has to be seen in that perspective.” 121. Even the report of the Chemical Examiner clearly reﬂ ects that it is ‘chewing tobacco’ . In fact, it is the Revenue that has been taking consistently inconsistent stand. In the ﬁ rst instance when Form No.1 was ﬁ led by the assessee declaring the product ‘Mahapasand zarda scented tobacco’ , the Department drew samples from the factory prem ises, obtained the CRCL Report, and called upon the assessee to r eclassify its product as ‘chewing tobacco’ under CET SH 2403 9910 and accordingly the Form No.1 was ﬁ led by the assessee and duty paid in tu ne with the declaration ﬁ led. It is only after Notiﬁ cation No.25 of 2015 came to be issued revising the duty payable on ‘zarda scented tobacco’ that fresh samples were drawn, and the Revenue started singing a ne w tune, and thus called upon the assessee to declare the product manufactured by it as ‘zarda scented tobacco’ . In the light of communication dated 27.04.2015 by the Revenue addressed to the assessee and calling up on the assessee to classify its product as ‘chewing tobacco’ and the s ame having been complied by the assessee it is too late in the day for t he Department to take a contrary stand. 122. The order of the tribunal has taken into account the aforestated aspects to arrive at a conclusion that the declaration ﬁ led by the assessee is just and proper, which does not suﬀ er from any inﬁ rmity either on facts or on law calling for our interference. Hence, the appeal ﬁ led by the Department deserves to be rejected. VI. COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX MEERUT II V . M/S SOM PAN PRODUCTS PVT. LTD. [DIARY NO. 14581/19] 123. In the present group, the Revenue is in appeal challenging the correctness and legality of order dated 25.09.2018 passed by CESTAT, Allahabad, whereby the order passed by the authorities below treating the product manufactured by the respondent as ‘zarda/jarda scented tobacco’ COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] falling under CET SH 2403 9930 and allowing the appeal as a consequence of the demands raised has been set aside. BRIEF FACTS 124. The assessee after obtaining the registration under the CE Ac t declared the product manufactured by them as ‘Jarda’ falling under CET SH 2403 9930 and it was assessed to duty as ‘Jarda scented tobacco’ . On 30.04.2015, the assessee ﬁ led a declaration eﬀ ective from 01.05.2015, declaring the product as Jarda, and on the same day separate ra tes for ‘Jarda scented tobacco’ and ‘chewing tobacco’ were notiﬁ ed having a vast diﬀ erence with respect to the duty leviable on ‘chewing tobacco’ . The Assistant Commissioner conﬁ rmed the duty on ‘Jarda/Zarda scented tobacco’ and thereafter the assessee vide communication dated 12.05.2015 sought to correct its declaration and intended to shift the product to tariﬀ heading CET SH 2403 9910 (chewing tobacco) instead of CET SH 2403 9930 i.e., ‘jarda/zarda scented tobacco’ . The Assistant Commissioner by communication dated 18.05.2015 rejected the request and by communication dated 20.05.2015 called upon the assessee to furnish a complete list of all ingredients used for the manufacturing of the product with write-u p and ﬂ ow chart duly certiﬁ ed. The assessee paid the duty under protest for the month of May 2015 though he has ﬁ led a revised declaration. The Assistant Commissioner vide order dated 02.06.2015 rejected the proposed change in classiﬁ cation and raised the demand for the months of June 2015 to September 2015 and this order was conﬁ rmed by the appellate authority on 12.01.2016. A separate show cause notice dated 04.05.2016 was issued claiming diﬀ erential duty on May 2015 which was conﬁ rmed vide order dated 16.03.2017 and the appellate tribunal set aside both the orders, namely, dated 12.01.2016 and 16.03.2017. The assessee’s attempt to contend that what was manufactured by it was ‘chewing tobacco’ by relying upon the sale invoices before the tribunal was successful and it was held that the product manufactured by the petitioner was ‘chewing tobacco’ . Hence, the Revenue is in appeal. SUBMISSIONS OF PARTIES 125. Ms. Nisha Bagchi, learned standing counsel for the Revenue, would contend that post facto declaration by the assessee would not be valid 649 in view of Rule 6,7,9 of CTPM Rules. She would contend that the assessee in its declaration had clearly declared the product in ma nufactured by it as, zarda scented tobacco, based on which the duty would be payable. The tribunal committed an error in proceeding on the basis that it is the case of the Revenue that assessee had manufactured Zarda by showing the same as CT though the assessee itself had declared manufacturing of zarda product. She would submit that the statutory provisions do not provide any deﬁ nition of the two competing terms and the goods would be classiﬁ ed as per general commercial parlance. She would further contend that the assessee had failed to demonstrate cogent evidence, that it manufactured chewing tob acco during the relevant period. Hence, she prays for the appeal being allowed. 126. The learning counsel appearing for the assessee would rely upon the registration form submitted to the department whereunder the list of ingredients used in the manufacture of the product had been speciﬁ ed and nowhere it is stated that scent was being used for the product and as such the department ought to have rebutted the ingredients furnished by the assessee. It is submitted that the assessee never declared the manufacture of ZST and even otherwise no testing of the product is carried out despite the request made by the assessee. It is submitted that the particulars furnished by the assessee classifying the product as ‘zarda’ under CET SH 2403 9930 would by itself not make the product as such and as has been conte nded by the revenue, it would be the product which was manufactured by t he assessee which would matter for determination of duty. Hence, the assessee has prayed for dismissal of the appeal. DISCUSSION AND FINDINGS 127. We have heard Smt. Nisha Bagchi, appearing for the appellant- Revenue, and Ms. Seema Jain appearing for the respondent-assessee. 128. A valiant attempt was made by Ms. Nisha Bagchi to contend that the tribunal erred in appreciating the fact that the onus of est ablishing the change in classiﬁ cation was on the assessee and it ought not to have looked into the IS glossary to arrive at a conclusion that the product manufactured by the respondent-assessee was ‘chewing tobacco’ . Hence, she has prayed for setting aside the order of the tribunal. Per contra, learned c ounsel for the assessee has supported the order of the tribunal. COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 129. Having heard learned advocates appearing for the parties we notice that the tribunal has assigned the following reason for accepting the plea of the assessee: - “Admittedly in the present case the appellants have markete d their product as chewing tobacco and not as Jarda scented tobacco. Revenue has neither disputed the manufacturing process undertaken by the appellant which shows non-use of any scent or perfume in the product nor have made any enquiries from the dealers, shopkeepers or the ultimate consumers of the product. No evidence of procurement of Perfume or Scent as raw material and then use in the product stands produced by the. Revenue. No employee of the assessee was examined so as to establish that perfume being used for manufacture of their ﬁ nal product. As such the said factor of marketing of the goods as chewing tobacco leads us to inevitable conclusion apart from other reasons as discussed above, that the product in question is admittedly chewi ng tobacco and not Jarda scented tobacco.” 130. The aforesaid conclusion arrived at by the tribunal is just and proper based on appreciation of factual matrix which would not c all for interference. Hence the appeal is dismissed. VII. COMMISSIONER OF CENTRAL EXCISE & ST ALWAR V . TARA CHAND NARESH CHAND [C.A NO.959 OF 2019] BRIEF FACTS 131. In the last group, in this batch of appeals before this Court, the Revenue is calling in question the order dated 28.03.2018 passed by CESTAT in Excise Appeal No.51953 of 2017 whereunder the order dated 27.09.2017 passed by the Commissioner of Central Excise classifying the product manufactured by the respondent-assessee as ‘chewing tobacco’ falling under CET SH 2403 9910, as against the claim of the Revenue of the said product falling under CET SH 2403 9930. 132. The respondent assessee had ﬁ led Form 1 declaring the product manufactured by it as ‘zarda/jarda scented tobacco’ which came to be adjudicated and accordingly an order came to be passed by the De puty Commissioner, whereunder the product of the assessee was class iﬁ ed by him as ‘chewing tobacco’ . The assessee ﬁ lled another form on 28.04.2015 651 describing the product as “Jayanti zarda/jarda scented” classifying the product under CET SH 2403 9910, culminating in another determination order dated 05.05.2015, wherein the Deputy Commissioner classiﬁ ed the product as ‘chewing tobacco’ under CET SH 2403 9910. 133. A search was conducted by the Director General of Central Excise in the factory of the petitioner after drawing the panchnama and recording the statement of Shri. Tara Chand Jain, partner of the assessee-ﬁ rm. The samples were forwarded for chemical examination. The chemical examiner opined that the samples had a characteristic odour of odoriferous substances vide report dated 07.03.2016. Hence, a show cause notice dated 24.02.2017 came to be issued alleging that during the period March 2015 to February 2016, the assessee manufactured the product using the process in which tobacco was ground and mixed with lime, menthol, synthetic ﬂ avouri ng perfumes, compound, etc. and was labelled as “Jayanti Brand Zarda”. Hence, alleging central excise duty amounting to Rs.4.81 crores was short paid and the demand came to be raised. The said show cause notice came to be adjudicated and the demand was conﬁ rmed. However, no penalty was imposed. The tribunal by the impugned order has allowed the appea l on the ground that the department itself had declared the classiﬁ cation as ‘chewing tobacco’ though the assessee had declared the same as ‘jarda/ zarda scented tobacco’ and as such by relying upon its order rendered in Urmin products private Ltd allowed the appeal. Hence, the Revenue has ﬁ led the present appeal. SUBMISSIONS OF THE PARTIES 134. We have heard the arguments of Nisha Bagchi, learned standing counsel appearing for the Revenue appellant and Mr. A.R. Madhav R ao, learned counsel appearing for the respondent assessee. It is the contention of the learned counsel appearing for the Revenue that the tribunal committed an error in arriving at a conclusion that the classiﬁ cation of the product is ‘chewing tobacco’ and not ‘zarda/jarda scented tobacco’ . She would contend that the Commissioner had examined the process of manufacture and taken into consideration the test reports of CRCL in the light of tariﬀ heading and the trade opinion, including the statement of two customers to conclude that the product is ‘zarda/jarda scented tobacco’ . She would submit that the tribunal erroneously applied the principles l aid down in COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] Urmin products and Flakes N Flavours without applying its mind to the present case. She would contend that the tribunal has merely relied upon the communication of the superintendent of excise whereunder the assesses’s prayer to classify the product as ‘zarda/jarda scented tobacco’ had been rejected and classiﬁ ed the same as ‘chewing tobacco’ to set aside the order in original which classiﬁ ed the product manufactured by the assessee as ‘chewing tobacco’ . 135. She would submit that there can be no dispute to the proposition that there cannot be estoppel in taxation proceedings and Section 1 1A of the CE Act, which permits demand within a normal period of limitat ion. Hence, she seeks for the appeal to be allowed. 136. Per contra, Shri A.R. Madhav Rao, learned counsel appearing for the respondent-assessee would contend that there can be no short levy for the past period, particularly in the present case, since the declaration ﬁ led by the assessee was approved. He would further contend that no appeals had been ﬁ led against the approval of the classiﬁ cation and said orders had become ﬁ nal. He would also add that ISI’s speciﬁ cation and glossary are applicable to determine the classiﬁ cation in the absence of any deﬁ nition of ‘chewing tobacco’ preparations for ‘chewing tobacco’ and ‘zarda/jarda scented tobaccot’ or any test prescribed by the CBIC. He would contend that the burden of classiﬁ cation or change of classiﬁ cation of a product is always on Revenue and the same has not been discharged. He would contend that there ought to be uniformity in classiﬁ cation. By relying upon the judgment of this Court in Damodar J. Malpani Vs. CCE reported in (2004) 12 SCC 70 in a case relating to ‘chewing tobacco’ itself, it was held that where the process adopted has been scrutinized and the Revenue in the case of one assessee has classiﬁ ed the product as ‘unmanufactured tobacco’ falling under heading 24.01 as it stood then, another assessee following the same process cannot be discriminated and there should be uniformity in classiﬁ cation. He would contend that veriﬁ cation contemplated under Rule 6(2) of CTPM rules 2010 is not conﬁ ned to a veriﬁ cation of only the number of machines installed in the applicant’s premises and the description of the product and classiﬁ cation of the same is also veriﬁ ed and this is evident from the fact wherein physical veriﬁ cation of the respondent’s product apart from the veriﬁ cation of the machines had been done when it attempted to change the classiﬁ cation of 653 the product from ‘chewing tobacco’ to ‘zarda/jarda scented tobaccot’ and same was turned down. He would submit that notiﬁ cation under Section 3A for the period in question ( i.e., March 2015 to February 2016 ) covered four diﬀ erent products each having a diﬀ erent deemed capacity of production and rate, which was a function of the speed of packing for some products. Therefore, the department would necessarily have to classify the appropriate tariﬀ entry in order to pass orders determining the monthly deemed capacity and duty to be paid by the applicant. He would submit that even the monthly returns depict the product of the respondent-assessee as ‘chewing tobacco’ has been scrutinized and assessed to be correct for the relevant period. By referring to Rule 12 of Central Excise Rules 2002, he would contend that ﬁ ling of the returns would be applicable to notiﬁ ed goods under Section 3A and said returns are required to be scrutinized and assessed by which process there would be veriﬁ cation of the product manufactured by the assessee and classiﬁ cation of the same. Hence, by relying upon the following judgments he prays for the dismissal of the appeal. a) Collector of Central Excise, Baroda vs. Cotspun Ltd. (1999) 7 SCC 633 b) Union of India vs. Delhi Cloth and General Mills 1963 Supp. 1 SCR 586. c) Collector of Central Excise, Kanpur vs. Krishna Carbon Paper Co. (1989) 1 SCC 150 d) Coastal Paper Ltd. Vs. Commissioner of Central Exci se, Vishakhapatnam (2015) 10 SCC 664 e) Parle Agro Pvt. Ltd. vs Commissioner of Commerci al Tax, Trivandrum (2017) 7 SCC 540 f) Damodar J. Malpani and anr v. Collector of Central Excise (2004) 12 SCC 70 DISCUSSION AND FINDINGS 137. We have heard the learned advocates appearing for the parties and perused the records. At the outset, we would like to make it explicitly clear that the tribunal though has relied upon the judgment of Urmin and Flakes-n-ﬂ avourz, apart from assigning other reasons, in the facts and COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] circumstances obtained in the present case, we have proceeded to examine the rival contentions, notwithstanding the ﬁ ndings recorded by the tribunal in Urmin Products and Flakes-n-ﬂ avourz which are the subject matter of Civil Appeal No.10159-161 of 2010 and Civil Appeal No.5146 of 2015, which has been adjudicated by us under this common order itself by assigning separate and independent reasons and the facts of the said case are distinguished from the facts of the present case. This view also gets fortiﬁ ed by the very fact that in the instant case, an inquiry was conducted in respect of assessee’s product and the superintendent in-charge of the respondent’s factory furnished the reports to the Deputy Commissioner on 04.03.2015 after visiting the factory of the assessee, inspected the mac hines and the product manufactured, since the assessee had declared in Form 1 t o the eﬀ ect that the product manufactured by it is ‘zarda/jarda scented tobacco’ . In the said report the superintendent has opined as under: “As regards the assessee’s letter dated 02.03.2015 regarding amendment in their Registration by changing the CETSH of their ﬁ nal product form 24039910 (Chewing Tobacco) to 24039930 (Jarda Scented Tobacco), it is submitted that looking to the production process/ingredients the product is already correctly classiﬁ ed under CETSH 24039910 and does not merit classiﬁ cation under the CETSH 24039930, as claimed by the assessee.” 138. Thus, it is clear that the stand of the assessee has been consistent to the eﬀ ect that product manufactured by it is to be classiﬁ ed as ‘zarda/ jarda scented tobacco’ and at the insistence of the jurisdictional Deputy Commissioner the assessee was classifying the goods under CET SH 2403 9910 i.e., ‘chewing tobacco’ , for which there was also an order of determination passed under Rule 6(2) of CTPM rule s. Whereas in the other matters, namely Urmin and Flakes-n-Flavourz, the facts were entirely diﬀ erent. In Urmin Products the assessee had declared the product as ‘chewing tobacco’ and then changed the classiﬁ cation to ‘zarda/jarda scented tobacco’ and again came back to the original position of declaring it or classifying it as ‘chewing tobacco’ . These classiﬁ cations in Urmin Products were at the behest of the assessee himself. In Flakes-n-Flavourz, the assessee was alleged to be manufacturing ‘zarda/jarda scented tobacco’ and clearing it as ‘chewing tobacco’ , and on facts it was found that there 655 were additives added to the tobacco. In the said case this Court on facts held that there was no wilful suppression attributable to the assesssee and the Revenue had failed to establish the product as ‘zarda scented tobaccot’. 139. In the instant case the assessee had clearly declared his product as ‘zarda/jarda scented tobacco’ falling under sub-heading 2403 9930 in Form 1 ﬁ led and based on the said declaration, capacity determination order dated 04.03.2015 under rule 6(2) had been passed re-classifying the product as ‘chewing tobacco’ . Accordingly, for the period April 2015 in Form-1 the assessee had described the product as ‘Jayanti Zarda Scented - 2403 9910’. However, in the capacity determination order dated 05.05.2015, the Deputy Commissioner classiﬁ ed the goods as ‘chewing tobacco’. As such, there was no misstatement or suppression of facts, collusion, or fraud in the instant case and hence on facts, the principles enunciated in Urmin’ s case is distinguishable. It may be noted that this court in the case of CCE vs. Damnet Chemicals Private Ltd. (2007) 7 SCC 490 had held: “26. In the circumstances, we ﬁ nd it diﬃ cult to hold that there has been conscious or deliberate withholding of information by the assessee. There has been no wilful misstatement much less any deliberate and wilful suppression of facts. It is settled law that in order to invoke the proviso to Section 11-A(1) a mere misstatement could not be enough. The requirement in law is that such misstatement or suppres sion of facts must be wilful. We do not propose to burden this judgment with various authoritative pronouncements except to refer the judgment of this Court in Anand Nishikawa Co. Ltd. v. CCE [(2005) 7 SCC 749 : (2005) 188 ELT 149] wherein this Court held : (SCC p. 759, para 27) “27. … we ﬁ nd that ‘suppression of facts’ can have only one meaning that the correct information was not disclosed deliberately to evade payment of duty. When facts were known to both the parties, the omission by one to do what he might have done and not that he must have done, would not render it suppression. It is settled law that mere failure to declare does not amount to wilful suppression. There must be some positive act from the side of the assessee t o ﬁ nd wilful suppression.” (emphasis supplied) COMMR. OF CEN. EXC. AHMEDABAD v. M/S URMIN PRODUCTS P. LTD. AND OTHERS [ARAVIND KUMAR, J.] 27. It is clear from the material available on record th at the Excise Authorities had inspected the manufacture process, collected the necessary information and details from the respondent assessee and even collected the samples and sent for chemical analysis. The authorities were aware of the tests and analysis reports of the products manufactured by the respondent assessee. The relevant facts were very much within the knowledge of the Department authorities. The Department did not make any attempt to lead any evidence that there was any wilful misstatement or suppression of facts with intent to evade payment of duty.” 140. In the facts of the present case, there has been no penalty levied under Rule 26 on the ground that there has been no intent to evade duty. In fact, the commissioner in his order dated 27.09.2017 concludes at para 48.2 to the following eﬀ ect: “..in view of the above there is no fraud or collus ion or any wilful misstatement or separation of facts with intent to ev ade payment of duty to invoke the provisions of Section 11A (4) of Central Excise Act, 1944 in the present case.” 141. It is also pertinent to note that on 04.03.2015 the respondent-assessee sought to make a change in the registration certiﬁ cate and claimed that the product manufactured by it was zarda/jarda . However, the appellant-Revenue called upon the respondent to withdraw the application for registration as ‘zarda’ and to show it only as ‘chewing tobacco’ and thereafter application showing the product as ‘chewing tobacco’ came to be ﬁ led on 06.07.2015, and accordingly said application was allowed on 23.07.2015 vide annexure A-45 (volume II of the counter aﬃ davit). Thus, the registration certiﬁ cate itself reﬂ ects the product as ‘chewing tobacco’. This court in the case of CCE vs. Tata Tech Ltd (2008) 11 STR 449 (SC) has held; “there cannot be a demand against the classiﬁ cation under which the product is registered without undoing the classiﬁ cation of the product in the registration certiﬁ cate”. 142. For the reasons aforestated we are of the considered view that the ﬁ ndings of the tribunal warrant no interference by this Court and the appeal has to fail. 657 143. We place on record our deep appreciation for the able assistance rendered by the learned counsel appearing for the parties , in not only making available compilation of statutory provisions, notiﬁ cations, and circulars prevalent at the relevant time, but also their erudite elucidation of arguments which are noted hereinabove, which enabled this Court to arrive at the conclusions recorded hereinabove. Resultantly, we proceed to pass the following: O R D E R (a) Civil Appeal Nos.10159-10161 of 2010, Civil Appeal No.…….. of 2023 arising out of Diary No.44912 of 2019 and Civil Appeal No……. of 2023 arising out of Dairy NO.6888 of 2020 are hereby allowed. (b) Civil Appeal No. 5146 of 2015, Civil Appeal No. 2469 of 2020 along with Civil Appeals arising out of Diary No.(s) 3492, 2810, 3484, 3513, 3536, 3544, 3545 and 3547 of 2020, Civil Appeal No. 3596 of 2023, Civil Appeal No. arising out of Diary No. 14581 of 2019 and Civil Appeal No. 959 of 2019 are hereby dismissed. (c) Civil Appeal No. ______ of 2023 arising out of Diary No. 3487 of 2020 stands remitted to the Tribunal for adjudication afresh in light of observations made in paragraph no. 110 and 113 of group number – 4 appeals ( i.e., Dharampal Premchand group ) (d) Costs made easy.