2002 (2) TMI 1258 - AT - Central Excise

Summary

Issues: Classification and eligibility for exemption under Notifications 8/96 and 4/97 for the product "Sunpac"

In this case, the issue at hand is the classification and eligibility for exemption under Notifications 8/96 and 4/97 for the product "Sunpac" manufactured by the applicant. The applicant claimed the classification of the goods as an article of plastic under Heading 3926.90 of the tariff, seeking eligibility for entry 57 of the Table to Notification 4/97. The department, however, proposed a different classification under Heading 3926.90 as sheets of plastic, which would result in denial of the exemption claimed. The Assistant Commissioner initially ruled in favor of the applicant, classifying the product as a profile shape under Heading 3926.90 and granting the exemption. However, on appeal, the Commissioner (Appeals) held the goods to be classifiable under Heading 3926.39, thereby denying the exemption.

The Commissioner (Appeals) based their decision on a previous Tribunal ruling in the appellant's case, which classified the product as a profile shape instead of a sheet. The Commissioner also referred to the Explanatory Notes to the Harmonised System of Nomenclature under Heading 39.20, stating that the presence of fluting between the layers did not disqualify the product from being considered a sheet. The applicant's counsel argued that despite the change in the tariff, the classification should remain unchanged, emphasizing that the Explanatory Notes did not consider the fluting between the layers. The departmental representative supported the Commissioner (Appeals) order.

The Tribunal, in a previous order, had noted the manufacturing process of the product, describing it as a profile shape consisting of two layers of sheets with corrugation inside, all fused into one. The Tribunal's decision was based on Notification 68/71 related to rigid plastic sheets, where the presence of fluting inside two layers disqualified the product from being classified as sheets. The Tribunal found that the manufacturing process and the presence of fluting inside the layers were crucial factors in determining the classification of the product.

Considering the arguments presented and the previous Tribunal rulings, the Tribunal in this case found no reason to deviate from the earlier classification and exemption granted to the product. The Tribunal noted that the change in the tariff nomenclature did not affect the product's classification, especially in light of the manufacturing process and the presence of fluting between the layers. As a result, the Tribunal waived the deposit of duty, stayed its recovery, and scheduled the appeal for further hearing.