ORDER : 1. This statutory appeal has been filed by M/s. Jain Irrigation Systems Ltd.- the appellant herein, under Section 35 - L(b) of the Central Excises Act,1944(for short" the Act")against the Final Order No. C - I/3026 dated 8th September, 2000 in Appeal No. 593/96-Bom. passed by The Customs, Excise & Gold (Control) Appellate Tribunal, Mumbai(for short "the Tribunal") where by and where under the Tribunal had dismissed the appeal filed by the appellant herein. 2. e issues arising in this appeal relates to (i) the classification of Poly tubes as well as other items which are an indispensable part of the irrigation system and are used as laterals, and (ii) whether the scrap lying with the appellant in its factory premises for the purposes of recycling the same would be a waste and, therefore, liable for confiscation and consequential penalty appellant is a manufacturer of irrigation system and parts thereof. 3. The appellant filed the classification list classifying the poly tube as well as other items forming part of the irrigation system under heading 8424 of the Central Excise Tariff Act, 1985 which classification was consistently being approved by the department. The appellant claimed full exemption under Notification No. 46/94-CE dated 1st March, 1996. The appellant was served with a show cause notice dated 3rd May, 1995 taking a prima facie view that the products of the appellant would fall under 39.17 which is the entry applicable to plastic tubes/pipes of general use and the appellant was not entitled to the exemption under the notification in question. Duty was proposed to be demanded for the period from 1.3.1994 to 30.11.1994 under that chapter. Extended period of limitation as provided in the proviso to Section 11-A of the Act was invoked. The appellant submitted a detailed reply denying the allegations made in the show cause notice and claimed that the authorities sought to confiscate the scrap lying in the factory premises of the appellant although the same was to be recycled and reused for further manufacture of the same product and imposed penalty. 4. The adjudicating authority, i.e., the Commissioner of Central Excise at Aurangabad did not decide the question regarding classification and held that since the notice issued was beyond the period of limitation, the demand created against the appellant could not be sustained. 4. The adjudicating authority, i.e., the Commissioner of Central Excise at Aurangabad did not decide the question regarding classification and held that since the notice issued was beyond the period of limitation, the demand created against the appellant could not be sustained. Further, on the scrap recovered from the factory premises of the appellant weighing 70 MT the value of which was assessed at Rs. 37.80 lakhs, was held to be liable to confiscation under Rule 173Q of the Central Excise Rules 1944 (the Rules). Since the goods had been released provisionally on furnishing a bank guarantee at Rs. 4.69 lakhs, it was deemed appropriate that the sum of Rs. 4.69 lakhs be appropriated towards confiscation. A penalty of Rs. 5 lakhs was imposed on the appellant. 5. Being aggrieved, the appellant as well as the department filed Appeals before the Tribunal. The appellant filed appeal against the confiscation of the scrap lying in the factory premises as well as imposition of penalty, while the department appealed on the point of limitation. The contention of the revenue was that the notices had been issued within the extended period of limitation. 6. The Tribunal dismissed the appeal filed by the revenue and up held the order of the Commissioner to the effect that the notices had been issued beyond the period of limitation. On the point of classification the Tribunal held that the poly tubes manufactured by the appellant would not fall under heading 8424, but it did not record a finding that the same would fall under chapter heading 3917. It also up held the order of the Commissioner on confiscation of the scrap and levying the penalty. Counsel for the parties have been heard. 7. Since the adjudicating authority had held the demand beyond the Period of limitation and dropped the same, in our view, there was no occasion for the tribunal to go into the question of classification, especially when the Tribunal agreed that the demand created was beyond the period of limitation. Question of classification is left open. There being no finding that the appellant intended to take the scrap outside the factory premises, the confiscation of the scrap which, according to the appellant, was to be recycled, cannot be held to be justified and, consequently, the confiscation of scrap as well as penalty levied cannot be sustained. 8. Question of classification is left open. There being no finding that the appellant intended to take the scrap outside the factory premises, the confiscation of the scrap which, according to the appellant, was to be recycled, cannot be held to be justified and, consequently, the confiscation of scrap as well as penalty levied cannot be sustained. 8. For the reasons stated herein above, the impugned order of the Tribunal on confiscation of the goods and penalty is set aside and the appeal allowed with no order as to costs. Since the amount of Rs. 4.69 lakhs has already been recovered by the revenue, revenue is directed to reimburse the appellant of the aforesaid amount along with statutory interest thereon.