2005 (2) TMI 597 - AT - Central Excise

Summary

Issues: Classification of Acid Resistant Clay bricks under Chapter headings 6901 and 6902.

Analysis:
1. The primary issue in the appeals before the Appellate Tribunal CESTAT, NEW DELHI, was the classification of Acid Resistant Clay bricks manufactured by the respondents. The controversy revolved around whether these bricks should be classified under Chapter heading 6901 or under Chapter heading 6902 of the Central Excise Tariff Act (CETA). The Revenue contended that the bricks should be classified under Chapter sub-heading 6902.90 as they are akin to fire clay bricks, attracting a duty rate of 15% ad valorem.

2. The learned SDR argued that the bricks in question were fire clay bricks and not simple clay bricks, emphasizing the need for classification under Chapter heading 6902. The impugned orders, which favored the Revenue, were challenged, seeking their reversal in favor of the Revenue.

3. On the other hand, the learned Counsel for the respondents supported the impugned order, citing reports from the Chemical Examiner and emphasizing the end-use of the bricks to substantiate the classification under Chapter heading 6901.

4. After hearing both parties and examining the record, the Tribunal delved into the classification criteria under Chapter headings 6901 and 6902. It was noted that Chapter heading 6901 pertains to bricks, blocks, tiles, and other ceramic goods of siliceous earths, with sub-heading 6901.10 specifically mentioning clay bricks other than fire clay bricks. In contrast, Chapter heading 6902 deals with Fire Clay bricks. The Tribunal also considered the HSN Notes of both chapter headings in question.

5. The Tribunal relied on reports from various laboratories, including the Central Glass and Ceramic Research Institute and the Chemical Examiner, which analyzed the properties and characteristics of the Acid Resistant Clay bricks. These reports indicated that the bricks in question did not qualify as fire clay bricks under Chapter heading 6902. The manufacturing process, raw materials used, and end-use of the bricks for lining chemical storage tanks further supported the classification under Chapter heading 6901. The Tribunal affirmed the Commissioner (Appeals)'s conclusion that the acid resistant clay bricks should not be classified as fire clay bricks under Chapter heading 6902, based on the evidence presented.

6. It was clarified that any previous misclassification by the respondents did not preclude them from claiming the correct classification under the CETA. The Tribunal upheld the validity of the Commissioner (Appeals)'s orders, dismissing the Revenue's appeals and affirming the classification of the Acid Resistant Clay bricks under Chapter heading 6901.