2007 (8) TMI 598 - AT - Central Excise

Summary

Issues:
1. Correct classification of Aluminium foil covered on both sides by polyester film under Chapter 39 or Chapter 76.

Analysis:
The appeal before the Appellate Tribunal CESTAT, AHMEDABAD involved the issue of the proper classification of Aluminium foil covered on both sides by polyester film. The appellant contended that the product should be classified under Chapter 39, while the Revenue argued for classification under Chapter 76. The appellant relied on a Supreme Court decision in the case of M/s. Sharp Industries Ltd. v. CCE, Mumbai-III, which held that the product falls under Chapter 39. However, the appellant acknowledged that during the period of the appeal (December 1993 to February 1999), there was no circular from the Board on the classification issue. Subsequently, a circular was issued in June 1999, which was against the appellant's position. The appellant sought to benefit from a new circular issued in October 2003, which classified the product under Chapter 76. The appellant argued that since the 2003 circular was in their favor and in force, they should be entitled to its benefits.

The Revenue, represented by Shri M.M. Mathkar, countered the appellant's arguments by emphasizing the Supreme Court's decision on the classification issue and asserted that the appeal should be dismissed based on that decision. The Tribunal, in its analysis, noted that the Supreme Court decision was unfavorable to the appellant. The Tribunal highlighted that the circular referred to by the appellant in 2003 was not in existence during the relevant period of the appeal. Therefore, the Tribunal concluded that the appellant could not claim the benefit of the 2003 circular as it was not applicable retroactively. The Tribunal emphasized the importance of judicial discipline in following the Supreme Court's decision and rejected the appellant's appeal based on the existing legal precedent and lack of merit in the appellant's arguments.

In summary, the Tribunal upheld the correct classification of the product under Chapter 39 based on the Supreme Court decision and denied the appellant's claim for benefits under a subsequent circular issued after the relevant period. The judgment emphasized the significance of adhering to legal precedents and highlighted the importance of the timeline of relevant circulars in determining the applicability of classification decisions.