2002 (12) TMI 258 - AT - Central Excise

Summary

Issues:
Classification of "Electromagnet Assembly" under Heading 90.33 or Heading No. 85.05 of the Central Excise Tariff Act.

Analysis:
The appeal involved the classification of the "Electromagnet Assembly" manufactured by M/s. Pal Brothers Works, now known as M/s. Season Electrics Pvt. Ltd. The main issue was whether the product should be classified under Heading 90.33 as parts of Electricity Supply Meters or under Heading No. 85.05. The Appellant argued that the product is a combination of two sub-assembled products, Electromagnet, and Power Factor, specifically designed as a meter part. The Advocate cited references to support the contention that the product is solely a part of an Electric Meter. On the other hand, the Revenue contended that the primary function of the product, being an electromagnet, should classify it under Heading 85.05.

The Appellate Tribunal carefully considered the arguments from both sides. It noted that the product in question is not a simple electromagnet but an assembly combining electromagnet and power factor. The Tribunal acknowledged that the Revenue did not dispute that the product is more than just an electromagnet due to the power factor being attached. Additionally, the Commissioner (Appeals) had explicitly stated that the goods are parts of an electric supply meter. The Tribunal referred to technical definitions to clarify that an "Electromagnet" and "Power Factor" are distinct components. As the product is a part of an electric meter and not a simple electromagnet, the Tribunal concluded that it should be classified under Heading 90.33, covering parts and accessories for machines of Chapter 90. The Tribunal found that Note 2(a) to both Chapter 85 and Chapter 90 did not apply in this case. Consequently, the impugned order was set aside, and the appeal was allowed.

In conclusion, the judgment resolved the classification issue by determining that the "Electromagnet Assembly" should be classified under Heading 90.33 as parts of Electric Supply Meters, based on the specific characteristics of the product and its intended use in electric meters. The decision was supported by technical definitions and previous findings, emphasizing the combination of components in the assembly and its role as a part of an electric meter.