2004 (2) TMI 422 - AT - Central Excise

Rubber sheets - Micro cellular rubber sheets - Classification of - Adjudication - Re-adjudication - Classification of goods

Summary

Issues involved:
Classification of Micro Rubber Cellular Rubber Sheets under sub-heading 4008.11 or sub-heading 3921.19 of the Central Excise Tariff Act.

Analysis:

Issue 1: Classification of Micro Rubber Cellular Rubber Sheets
The appeal questioned the classification of Micro Rubber Cellular Rubber Sheets by M/s. Popular Rubber Industries under sub-heading 4008.11 or sub-heading 3921.19 of the Central Excise Tariff Act. The Appellate Tribunal had remanded the matter to the Adjudicating Authority for re-testing the proper sample of the product and passing a well-reasoned order after providing a fair hearing to the appellants. The Advocate argued that test results favored their classification under sub-heading 4008.11, but the Commissioner classified the goods under sub-heading 3921.19 without considering the benefit of a specific notification. The Advocate contended that the Commissioner's reliance on the earlier test report was misplaced and contrary to the Tribunal's remand direction. The Advocate further highlighted that the appellants were eligible for exemption under specific notifications and relied on a relevant case law to support their argument.

Issue 2: Compliance with Tribunal's Remand Order
The Tribunal's remand order explicitly required the Adjudicating Authority to obtain a proper sample of the product for testing. The Tribunal emphasized that classification should be based on the test report, and the original test report was deemed improper. The Adjudicating Authority proceeded with re-adjudication based on the original test report, which was against the Tribunal's directions. The Tribunal held that the Revenue failed to establish that the goods were classifiable under a specific tariff entry, shifting the burden of proof onto the Revenue. As the Revenue did not discharge this burden, the product remained classified under the heading declared by the appellants. Citing a relevant Supreme Court case, the Tribunal set aside the impugned order and allowed the appeal in favor of the appellants.

In conclusion, the Appellate Tribunal ruled in favor of M/s. Popular Rubber Industries, setting aside the Commissioner's classification of the Micro Rubber Cellular Rubber Sheets under sub-heading 3921.19. The Tribunal emphasized the importance of following remand orders and the burden of proof in classification disputes, ultimately deciding that the appellants' classification declaration should prevail.