2004 (2) TMI 452 - AT - Central Excise

Summary

Issues Involved:
Classification of goods under Heading 8607.00 for duty purposes.

Analysis:
The appeal before the Appellate Tribunal CESTAT, Mumbai involved a dispute regarding the classification of goods for duty purposes. The appellant sought to dispense with the condition of pre-deposit of duty amount and personal penalty imposed on them. The demand of duty was confirmed against the appellants for the period from 18-3-90 to 30-7-97, contending that the product manufactured by them should be classified under Heading 8607.00 as part of Railway Locomotive, rather than under Heading 7508.00 as claimed by the appellants.

The Commissioner (Appeals) observed that the appellants' product, known as "Valve Seat Insert," was specifically used as a part of Railway Locomotives, and its classification should be based on its use and the meaning attached to it. The Commissioner noted that there was no specific entry for castings of nickel in Chapter 75, and the appellants' product was exclusively designed for Railway use. The Commissioner concluded that the goods were properly classifiable under Heading 8607.00.

The appellant's manager argued that the Revenue had not provided evidence that the Railways were using the product as part of the Railway Locomotive. He contended that the classification list filed by them was approved by the proper officer, and no financial hardship was pleaded. On the other hand, the Respondent's representative pointed out that the appellants had not disputed that the goods were being used by the Railway as part of the Locomotive, and no contrary evidence was presented.

After considering the submissions, the Tribunal found that the goods, identified as "Valve Seat Insert," were manufactured as per the Railway's design and specification and were used as part of the Railway Locomotive. As there was no entry for casting of nickel under Chapter 75, the Tribunal concluded that the appellants did not have a prima facie case in their favor. The Tribunal directed the appellants to deposit the total duty amount within one month, waiving the penalty amount subject to the deposit, and stayed the penalty recovery during the appeal's pendency. Compliance reporting was scheduled for a later date.