2003 (11) TMI 407 - AT - Central Excise

Summary

Issues: Classification of auto bulbs under Central Excise Tariff - Applicability of Sub-heading No. 8539.10 for bulbs sold in bulk

In this case, the appellants, who are manufacturers of auto bulbs falling under Sub-heading No. 8539 of the Central Excise Tariff, claimed classification under Sub-heading No. 8539.10, while the department contended for classification under Sub-heading No. 8539.90. The dispute arose as the department demanded duty for Rs. 33,20,015, arguing that since the bulbs were sold in bulk to original equipment manufacturers of automobiles at Rs. 8 per bulb, Sub-heading No. 8539.10, applicable to vacuum and gas-filled bulbs of retail sale price not exceeding Rs. 20 per bulb, was not applicable due to the bulk sale. The appellants sought a waiver of pre-deposit of duty and penalty based on a strong prima facie case in their favor.

Upon hearing both sides, the Tribunal examined the order of the ld. Commissioner and noted that there was no allegation of the retail price exceeding Rs. 20 per bulb, with the declared price of Rs. 8 per piece unchallenged. The main contention against classification under Sub-heading No. 8539.10 was that the sale was in bulk and not in retail, with individual bulbs lacking affixed retail prices as required by the Standards of Weights & Measures Act 1976. The appellants cited Board's Circular No. 625/16/2002/CX., dated 28-2-2002, which clarified valuation in cases of partial bulk sale and partial retail sale under Section 4A. However, this circular was not considered in favor of the appellants.

For the purpose of waiving pre-deposit, the Tribunal analyzed the applicability of Sub-heading No. 8539.10. It was observed that the entry required only a demonstration that the retail sale price did not exceed Rs. 20 per bulb. As the impugned order did not show the retail price exceeding this limit, the Tribunal found a strong prima facie case in favor of the appellants. Consequently, the Tribunal granted a total waiver of pre-deposit of duty and penalty as demanded, along with a stay, scheduling the matter for regular hearing on 17-12-2003.