2008 (9) TMI 692 - AT - Central Excise

Summary

Issues: Classification of marble block/slab tiles under Central Excise Tariff Heading, waiver of pre-deposit of duty and penalty

Classification Issue Analysis:
The dispute in this case revolves around the classification of marble block/slab tiles under the Central Excise Tariff. The applicants claim that the products should be classified under Heading No. 25, while the Revenue argues for classification under Heading No. 68 due to various processes like sizing, surfacing, resin filling, polishing, etc. The Board's circular dated 3rd September 2008 plays a crucial role, stating that marble slabs with uneven surfaces post-cutting remain under Chapter 25. Chapter Note 6 of Chapter 25 emphasizes that processes like cutting, sawing, sizing, or polishing for converting stone blocks into slabs or tiles constitute manufacturing. Notably, Chapter 68 excludes goods of Chapter 25, covering articles of stones or building stones. Considering these provisions and the Board's circular, the applicants seem to have a strong case favoring classification under Chapter 25.

Waiver of Pre-deposit Issue Analysis:
The applicants sought a waiver of pre-deposit of duty amounting to Rs. 1,39,99,439/- and a penalty of Rs. 40 lakhs. The Tribunal, after considering the arguments from both sides and the classification issue, decided in favor of the applicants. The Tribunal found that prima facie, the applicants have a strong case based on the provisions of Chapter 25, Chapter 68, and the Board's circular. Consequently, the Tribunal waived the pre-deposit of duty and penalty, allowing the stay petition filed by the applicants.

In conclusion, the judgment by the Appellate Tribunal CESTAT, New Delhi addressed the classification issue of marble block/slab tiles under the Central Excise Tariff, emphasizing the importance of relevant provisions and the Board's circular. The decision to waive the pre-deposit of duty and penalty was based on the Tribunal's assessment of the strong case presented by the applicants in light of the legal framework and circular clarification.