S.V. Maruthi, Member (J)

1. The dispute relates to the classification of plastic pipes, tubes and fittings and bolts and nuts and gears for electroplating barrels.

2. The appellants are a small scale industry engaged in the manufacture of articles of plastics. Prior to 1st March, 1986 articles of plastics are exempt from payment of duty. Therefore, with effect from 1st March, 1986, they started filing classification list classifying the plastic pipes, fittings, tubes, bolts and nuts under Tariff Heading 39.17 and 39.22.90 respectively and claimed exemption under Notification No. 132/86. With effect from 14-4-1986 classification list No. 193/86-87 was filed claiming under Heading 3917 and exemption under Notification No. 132/86 for pipes and fittings. Similar classification lists were filed upto 3-3-1988. All the classification lists filed by the appellants were approved by the Central Excise authorities. The appellants also filed RT 12 for the months of Feb. 1987, June, 1987, Nov., 1987 and Dec. 1988. Therein they have claimed the benefit of exemption. The appellants have adopted the invoice price for assessment. Therefore, they were enclosing invoices with RT returns for the purpose of assessment. In the year 1990-91, the classification list No. 15/90-91, dated 3-1-1991 was filed for gears for electroplating barrels. The Superintendent directed the appellants to furnish the information as to the use of gears. The appellants replied that these gears were used for electroplating barrels. Similarly, another query was raised asking the appellants to furnish the information relating to the use of tubes and fittings, bolts and nuts etc. The appellants furnished the necessary information on 21-3-1991. The appellants submitted that these pipes, fittings, bolts and nuts and gears were used in the chemical industry because of their non-corrosive characteristics.

3. A Show Cause Notice was issued proposing to re-classify the goods on the ground that since the pipes and fittings, gears, bolts and nuts are used in chemical industry because of their non-corrosive characteristic, they are liable to be classified under Chapter 84. It is also proposed in the Show Cause Notice to demand duty of Rs. 36,65,698.20 on the clearances made during the period 1st April, 1986 to 31st March, 1989. The allegations in the Show Cause Notice are that the appellants suppressed the fact (1) that the products were exclusively used in chemical, pharmaceutical and fertiliser projects; (2) that these products are non-corrosive characteristics; (3) they never declared or informed the end-use; and (4) they did not give full description.

4. On receipt of reply, the Collector held that the appellants wilfully suppressed and mis-declared the facts warranting invoking extended period of limitation and passed the impugned Order against which the present appeal is filed.

5. The Collector held relying on Rule 2(n) of the interpretative rules that these items namely plastic pipes and pipe fittings are exclusively used in chemical, pharmaceutical and fertilisers projects and, therefore, they are classifiable under Heading 8485.10 as machinery parts not specified elsewhere in Chapter 16. Similarly, he classified the nuts and bolts under 8485.90, gears for electroplating barrels were classified by the Collector under Tariff Heading 3925.90.

6. The appellants are not challenging the classification of the gear. However, they challenging the same on the ground of limitation which will be dealt with in the latter paragraphs.

7. The main contentions of Shri Lakshmikumaran are that the Show Cause Notice is barred by limitation; (2) Pipes, fittings and tubes are classifiable under Tariff Heading 3917. The Collector proceeded to classify the goods on the basis of enduse which is not a requirement provided under Tariff Heading 84. Tariff Heading 3917/3926 are specific headings, covering the impugned items namely pipes, fittings, tubes, nuts and bolts where the enduse if irrelevant. In s