CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL CHENNAI REGIONAL BENCH – COURT No. III Excise Appeal No. 40168 of 2018 (Arising out of Orders-in-Appeal Nos. 313 & 314/2017(CTA-I) dated 10.11.2017 passed by Commissioner of GST and Central Excise (Appeals-I), No. 26/1, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034)

M/s. Thermal Energy Systems ...Appellant No. 19-L/A Tass Industrial Estate, Ambattur, Chennai – 600 098.

Versus Commissioner of GST and Central Excise ...Respondent Chennai North Commissionerate, No. 26/1, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034.

And Excise Appeal No. 40169 of 2018 (Arising out of Orders-in-Appeal Nos. 313 & 314/2017(CTA-I) dated 10.11.2017 passed by Commissioner of GST and Central Excise (Appeals-I), No. 26/1, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034)

Mr. Muruganandam, Partner ...Appellant M/s. Thermal Energy Systems, No. 19-L/A Tass Industrial Estate, Ambattur, Chennai – 600 098.

Versus Commissioner of GST and Central Excise ...Respondent Chennai North Commissionerate, No. 26/1, Mahatma Gandhi Road, Nungambakkam, Chennai – 600 034.

APPEARANCE:

For the Appellants : Mr. Hari Radhakrishnan, Advocate For the Respondent : Mr. M. Selvakumar, Authorized Representative CORAM:

HON’BLE MR. P. DINESHA, MEMBER (JUDICIAL)

HON’BLE MR. VASA SESHAGIRI RAO, MEMBER (TECHNICAL)

FINAL ORDER Nos. 40289-40290 / 2026 DATE OF HEARING : 05.12.2025 DATE OF DECISION : 23.02.2026 Per Mr. VASA SESHAGIRI RAO The present appeals arise out of Orders-in-

Appeal Nos. 313 & 314/2017 dated 10.11.2017 passed by the Commissioner of Central Excise (Appeals), Chennai, whereby the appellate authority upheld Order-in-Original No. 25/2017 dated 10.03.2017 passed by the Joint Commissioner of Central Excise, Chennai-II Commissionerate. Under the said adjudication order, Central Excise duty demand along with interest and penalties came to be confirmed against (i) M/s. Thermal Energy Systems, a partnership firm (hereinafter referred to as “Appellant No.1” or “the Appellant ”) and (ii) Shri. K. Muruganandam, partner of the firm (hereinafter referred to as “Appellant No.2”).

2. The Appellant is engaged in the manufacture of Aluminium Extruded Finned Tubes and Heat Exchangers (Spiral Type), which are used as components/parts in rice par-boiling machines and driers employed in rice mill machinery. During the relevant period, the Appellant classified the said goods under Central Excise Tariff Heading 8437, attracting Nil rate of duty, relying upon the binding clarification issued by the Central Board of Excise & Customs vide Circular No. 924/14/2010-CX dated 19.05.2010, wherein parts and accessories of rice mill machinery were opined to merit classification under Heading 8437.

3. Subsequently, the Board revisited the classification issue and issued Circular No. 982/06/2014-CX dated 15.05.2014, rescinding the earlier circular and clarifying that rice par-boiling machines and driers would merit classification under Heading 8419, attracting duty, and further indicating that necessary action may be taken in respect of past clearances. Based on intelligence, the Central Excise officers visited the Appellant ’s premises on 02.09.2014 and found that the Appellant’s turnover had exceeded the SSI exemption threshold and that no duty had been discharged for the period April 2012 to July 2014. Consequently, a Show Cause Notice dated 24.06.2016 was issued proposing demand of duty of Rs.99,47,758/- under Section 11A(4), recovery of Rs.2,20,611/- collected but not deposited under Section 11D, along with interest and penalties under Section 11AC, Rule 25, and personal penalty under Rule 26. The adjudicating authority confirmed the proposals in full, and the Commissioner (Appeals) upheld the same, giving rise to the present appeals before the Tribunal.

4. The Ld. Advocate Mr. Hari Radhakrishnan, appeared for the Appellants and the Ld. Authorized Representative Mr. M. Selvakumar appeared for the Revenue.

5. The Learned Counsel submitted that the