2006 (7) TMI 382 - AT - Central Excise

Summary

Issues:
Classification of 'Rain Wears' under Central Excise Tariff Act, 1985

Analysis:
The judgment addressed the issue of classification of 'Rain Wears' made out of Rubberised Textile Fabrics under the Central Excise Tariff Act, 1985. The appellant had declared the goods as 'Articles of Apparel, not knitted or crocheted, all sorts - Rainwear/Caps' and claimed classification under heading 6201.00 of the Tariff. However, show cause notices were issued seeking to classify the products under heading 4015.00. The lower authorities relied on previous decisions to classify raincoats as articles of ready-to-wear apparel under heading 4015.00, exempted under Chapter Note 2(a) of Chapter 62 of the Tariff.

The Tribunal analyzed the term 'Worn Apparel,' emphasizing that it includes only single apparel or ready-made garments that are used or could be put to further use as garments. Fresh unused garments fall under Chapter 62, while used worn garments are classified under Chapter 61. The interpretation of 'Worn Apparel' was crucial to avoid rendering Chapter 62 redundant. The Tribunal found that raincoats made of rubberised fabrics should be classified under heading 6201.00, under Chapter 62, as fresh and unused garments. The heading 4015.00 was deemed applicable only to accessories for garments, not entire garments like raincoats.

The Tribunal concluded that the appellant had made a strong case for a complete waiver of pre-deposit, as the earlier decisions relied upon were not applicable to the current case. The Tribunal highlighted the importance of considering the HSN Classification Notes and the interpretation of terms like 'Worn Apparel' in determining the classification under the Central Excises Act. Therefore, the Tribunal granted a full waiver of the pre-deposit requirement and stay of recovery, allowing both parties to file applications for early hearing of the appeals to resolve the classification issue effectively.