Tarun Chatterjee JUDGMENT
Tarun Chatterjee, J.
1. Appellant M/s. Anand Nishikawa Co. Ltd. is a manufacturer of rubber profiles which product, after extrusion is subject to notching or drilling of a few holes or slitting. The appellant had classified such extruded rubber profiles under subheading 4008.29 of the Central Excise Tariff which attracted Nil rate of duty. The Revenue, however, classified such rubber under heading 4016.19.
2. According to Revenue, the operations like notching, drilling and slitting are "further working" and in view of Note 9 to Chapter 40, these goods fall outside Heading 40.08. Accordingly, a show cause notice was issued in October, 1995 demanding duty of over Rs. 2.18 crores for the period from September 1990 to February, 1994 under the proviso to Section 11A of the Central Excise Act, 1944 (hereinafter referred to as 'the Act'). The Commissioner by his order dated 2nd August 1996 discharged the show cause notice, inter-alia, on the ground that proviso to Section 11A of the Act was inapplicable in the facts of the case. In his order, the Commissioner observed that the authority had knowledge of the manufacturing process of the appellant and was seized of the matter from the very beginning and on few occasions, the department officers visited the factory for collection of samples and study etc. Adverse inference was also drawn by the Commissioner in his order dated 2nd August, 1996 against the department as show cause notice did not deal with the correspondence exchanged between the appellant and the department on the issue of classification from the year 1988. An appeal was carried by the Department against the aforesaid order of the Commissioner before the Customs, Excise and Gold (Control) Appellate Tribunal, (hereinafter referred to as "CEGAT") New Delhi which was allowed by the CEGAT on the issue of limitation that is to say extended period of limitation under proviso to Section 11A of the Act would be available in the facts of this case. However, the matter was sent back to the Commissioner for a decision on the question of classification and availability of MODVAT credit etc. Against this order of remand, passed by the CEGAT, this appeal has been filed under Section 35(L) of the Act in this Court which, on admission, was listed for final disposal.
3. We have heard Mr. V. Sridharan, learned counsel appearing for the Assessee/Appellant and Mr. Mohan Parasaran, the learned Additional Solicitor General for the Revenue. We have carefully examined the show cause notice, the order of the Commissioner discharging the show cause notice and the order of the CEGAT holding that the authority was entitled to invoke