2008 (12) TMI 542 - AT - Central Excise

Summary

Issues:
Classification and valuation of "Fibre Door frame and Shutter" under Chapter 44 or CH 39.

Analysis:

Issue 1: Classification and Valuation of "Fibre Door frame and Shutter"

The issue in this case revolves around the classification and valuation of the "Fibre Door frame and Shutter" manufactured by the appellants. The appellants argue that these items should be classified under Chapter 44 as "Articles of Wood," while the Revenue contends that they fall under CH 39 as 'Plastic articles.' The appellants presented samples of the items to the bench, emphasizing that the articles are predominantly made of wood with a coating of fibers. An expert, Shri H.S. Nagaraj, Consulting Engineer, opined that 73% of the material amounts to wood. The Tribunal referred to a previous case involving commercial ply wood coated with duty paid phenol formaldehyde resin, which was classified under CH 4408.90 as 'Articles of wood.' This decision was upheld by the Supreme Court. The appellants also highlighted CBEC Circulars providing guidelines for the classification of composite articles.

Issue 2: Waiver of Pre-deposit

After careful consideration, the Tribunal found that the appellants have a strong case on merits. Notably, the appellants had already deposited a significant sum of Rs. 10 lakhs. Consequently, the Tribunal deemed it a fit case for waiver of the pre-deposit of the balance amounts of duty/interest/penalties. The Tribunal ordered a full waiver of the dues demanded, including penalties on the Directors. It further directed that no coercive measures should be taken by the Revenue until the appeals are disposed of. Stay applications were allowed, and the appeals were scheduled for final hearing on a specific date. The Registry was instructed to link these appeals with another appeal for hearing.

This detailed analysis of the judgment provides insights into the classification and valuation dispute regarding the "Fibre Door frame and Shutter" and the Tribunal's decision to grant a waiver of pre-deposit based on the merits of the case and the actions taken by the appellants.