By TIOL News Service

MUMBAI, JULY 04, 2017: THIS is an appeal filed by the assessee against the order passed by the CCE, Nashik in March 2006.

The Bench, at the outset, observed that although several opportunities were granted to Revenue, there was no argument from their side with evidence to show as to whether "Armada" vehicle manufactured by the appellant was 10-seater vehicle falling under Tariff heading 8702 or ‘below that' to be classified under Tariff Heading 8703.

Inasmuch as the CESTAT further noted that the show-cause notice issued on 27.9.1993only alleged that it appears from the facts and enquiry that there was a wrong classification of the vehicle "Armada" by the appellant under heading 8702 instead of 8703;that there is no whisper about the reason why the classification pleaded by the appellant was not tenable and whether Revenue's allegation is made on any enquiry from Motor Vehicle Authority as to seating capacity;that the SCN also did not reveal whether technical drawing and design of the vehicle was examined by Revenue to make the allegation.

The Bench, therefore, emphasized that the SCN being foundation for the adjudication process, without the reason stated therein, adjudication would be an empty formality and a futile exercise. [Brindavan Beverages - 2007-TIOL-118-SC-CX, Ballarpur Industries Ltd. - 2007-TIOL-153-SC-CX , Champdany Industries Ltd. - 2009-TIOL-104-SC-CX and Precision Rubber - 2016-TIOL-28-SC-CX refers.]

Expressing displeasure about the manner the SCN had been issued without any evidence and legal basis, the CESTAT observed that a hypothetical demand had been made and accordingly concluded thus -

"4. … Once that is absent, adjudication order is fatal. Finding no reason stated in the show-cause notice, except a bald statement therein as to sitting capacity of "Armada Vehicle" without making any technical examination or conducting enquiry from Motor Vehicle authority, opportunity of defence was denied to the appellant to defend its case. Mere assumption that Armada vehicle had sitting capacity below 10 does not make the adjudication sustainable. Ld. adjudicating authority did not conduct physical verification of the vehicle nor the vehicle was sent to the Motor Vehicle authority to ascertain the seating capability thereof, for a proper classification. Summarily discussing in para 44 of the impugned order as to the law relating to the classification and without any technical report to support order of learned adjudicating authority, adjudication has been made arbitrarily."

The impugned order was set aside and the appeal was allowed.

(See 2017-TIOL-2259-CESTAT-MUM)