2004 (7) TMI 385 - AT - Central Excise

Summary

Issues: Classification of entities under Heading 3809.00 or 3402.00 of Central Excise Tariff Act, 1985.

The judgment involves a dispute regarding the classification of certain entities claimed by the appellants to fall under Heading 3809.00, while the Revenue classified them under Heading 3402.00 based on test reports and declarations admitting the constituents to have Surface-active agents. The Tribunal emphasized that the classification of an entity depends on the entry's scope and primary function, considering whether functions like finishing, carrier, accelerators, or fixing of dye-stuff agents are primary or subsidiary compared to the detergent function of the surface-active agents. The Tribunal noted that meeting the specifications of Note 3 to Chapter 34 does not automatically warrant classification under Chapter Heading 3402. It stressed the importance of determining primary and subsidiary functions for proper classification, especially when exclusion clauses under head notes restrict inclusions. The Tribunal found that the exclusion of the entity from Chapter Heading 3402 was not adequately considered before classification, leading to the order being set aside for re-determination after ascertaining the function.

As the matter was remitted for re-determination of classification, the Tribunal decided to keep other issues open for future consideration. The appeal was allowed, directing the original authority to re-determine the classification after hearing the appellants and considering any material they wish to present to establish the exclusion of the entities from Chapter Heading 3402. Subsequently, any duty demands and other issues such as time bar were to be addressed after the classification was re-determined. The appeal was allowed, with all issues being kept open for further proceedings upon remand.