G. Sankaran, Senior Vice-President

1. This order disposes of a batch of 10 appeals and two cross objections of these, 9 appeals and one cross objection are by M/s. Knit Foulds Private Ltd. (herein - after referred to as the assessee) and the remaining appeal by the Revenue. All these matters have arisen out of the Order-in-Appeal Nos. 41 to 54 CE/CHG/81/84 dated 14.2.84 passed by the Collector of Central Excise (Appeals) Delhi.

2. By the impugned order, the Collector (Appeals) disposed of three issues :

(i) Whether the product "Nylon Rubber Transmission Belting" manufactured, by the assessee falls for classification as Rubber Products under Item 16A or the Central Excise Tariff Schedule (CET, for short); or under the residuary Item 68.

(ii) If the goods fall under Item 16A, whether the assessee is entitled to exemption under Ntfn. 71/78 by virtue of the fact that the clearances of the said product under Item 16A did not exceed Rs.5 lakhs and the clearances of all excisable goods not exempted were less than Rs.20 lakhs but including the clearances of exempted excisable goods, the value of clearances exceeded Rs.20 lakhs. In other words, the question for determination is whether the clearances of exempted goods is to be taken into account to compute the value limit of Rs.20 lakhs for clearances of all excisable goods;

(iii) Whether the demand of Rs. 1,58,484.25 for the period 1.4.79 to 4.6.80 is hit by limitation of six months specified in Central Excise Rule 10 (as it existed at the material time) inasmuch as the show cause notice was served on the appellants on 11.9.80.

3. On the first issue, the Collector held that the T.R. Beltings correctly fell for classification under Item 16A (4) CET. On the second issue, the Collector said that he had already found against the assessee in his Order-in-Appeal dated 21.3.81. On the last issue, the Collector held that the demand for duty was enforceable only for the normal period of limitation of six months.

4. Though the Collector (Appeals) disposed of 14 appeals, his order is being challenged before us in only 9 matters. What is under challenge is the Order-in-Appeal in so far as it pertains to the Asst. Collector's orders dated 16.7.81 and 11.7.83 and the Superintendent's orders of assessment on the RT 12 Returns for August, September, October, November and December 1980 and February and March 1981. The Superintendent's orders on these assessment returns are the subject of the seven appeals Nos. 980 to 986/84-D. Appeal No. 866/84-D arises out of the Asstt. Collector's order dated 16.7.81 on the classification list. Against this very order, the Department has filed an appeal No. 873/84-D. The ninth appeal No. 867/84-D is by the assessee and this arises out of the Asstt. Collector's order dated 11.7.83.

5. Since the issue of classification of the goods is basic to the resolution of the disputes before us, we shall take it up first.

6. Appeal No. 866/84-D and CO. 340/84-D. - M/s. Knit-Foulds Private Ltd. is engaged in the manufacture of Nylon Transmission Conveyor and Elevator Belts (hereinafter referred to as 'T.R. Belts') from cloth, plastic strip, synthetic rubber and adhesive solutions. The Asstt. Collector, in her Order No. 17/Val/81 dated 30.4.81 held the T.R. Belts to be classifiable under Item 16A(4), C.E.T., rejecting the assessee's claim for classification under Item 68 C.E.T. She also rejected the assessee's claim for the benefit of duty exemption in respect of these goods under Central Excise Notification 80/80 dated 19.6.80 on the ground that the value of clearances of all excisable goods (under Items 16A and 68 C.E.T.) had exceeded the prescribed limit of Rs. 20 lakhs during the year 1979-80. The matter was carried in appeal by the assessee. The Collector (Appeals) in his Order No. 96/CE/CHG/83, dated 30.12.82 observed with respect to the assessee's contention that the rubber content was lower than the Nylon content and that, therefore, the T.R. Belts would not fall under Item 16