V.T. Raghavachari, Member (J)

1. According to the appellants M/s. Kwality Containers Pvt. Ltd. they manufacture pilferage proof caps falling under TI 42 CET as also aluminium tear off vial as well as an aluminium tear down vial seals falling under TI-68 CET. In respect of the pilferage proof caps they were claiming exemption under notification 83/83 and in respect of the other aluminium vial seals they were claiming exemption under notification 77/83. In respect of these aluminium vial seals the department had a doubt on the classifiability under TI 68 but, subsequently, the Assistant Collector under order dated 8.10.1980 settled their classification under TI 68 CET.

2. After a visit of their factory on 21.1.1985 during the course of which 3,31,000 pieces of tear off and tear down vial seals were seized under the belief that they are classifiable under TI 42 CET and not under TI 68 CET. Action was initiated by issue of notice dated 6.6.1985. It was alleged that as these seals had been manufactured and cleared without payment of duty under TI-42 CET the appellants had contravened various rules and had made themselves liable for penalty, confiscation and demand of duty. After the