1998 (11) TMI 603 - AT - Central Excise

Summary

Issues: Classification of goods under tariff items 56.06 and 55.04

Classification under Tariff Items 56.06 and 55.04:
The appeal involved a dispute regarding the classification of goods manufactured by the appellants. The Assistant Collector initially classified the goods as falling under tariff item 55.04, but a subsequent decision by the Collector of Central Excise (Appeals) reclassified the goods under tariff item 56.06. The goods in question were a blended staple yarn of man-made staple fibers, including small pieces of brown-colored two-ply yarn of the same specification in viscose and polyester fiber. The Chemical Examiner's report described the composition of the yarn and noted the special effects created by the brown-colored yarn. The Assistant Collector's order emphasized that the yarn did not exhibit typical features of novelty yarn and was manufactured in the same manner as ordinary spun yarn. The appellants argued that the Collector's decision was incorrect and that the findings of the Assistant Collector should prevail as they were based on evidence on record. They also highlighted the absence of additional evidence to overturn the Assistant Collector's findings. The Tribunal analyzed the facts, including the composition of the yarn and the absence of novelty yarn characteristics, and concluded that the goods should be classified under tariff item 56.06 based on the HSN Note and the Assistant Collector's observations. The Tribunal found that the Collector's decision lacked substance and, therefore, allowed the appeal, rejecting the Collector's classification and reinstating the Assistant Collector's order.

Conclusion:
The Tribunal allowed the appeal and provided consequential relief, overturning the Collector of Central Excise (Appeals)'s classification of the goods under tariff item 56.06 and reinstating the Assistant Collector's classification under tariff item 55.04. The decision was based on the analysis of the composition of the yarn, the absence of novelty yarn characteristics, and the applicability of the HSN Note regarding the classification of similar products.