2009 (3) TMI 754 - AT - Central Excise

Summary

Issues: Classification of waste and scrap of baked and unbaked carbon under the Central Excise Tariff.

In this case, the Appellants filed an Appeal against an Order classifying waste and scrap of baked and unbaked carbon under Tariff Heading 28.03 of the Central Excise Tariff, resulting in a demand being confirmed against them. The Appellants argued that the Adjudicating Authority's decision was beyond the scope of the show cause notices issued, as the notices did not propose reclassification under Heading 28.03. The Appellants contended that they were not given notice for reclassifying the goods under Chapter 28 of the Tariff, making the Order unsustainable. On the other hand, the Revenue claimed that the goods were rightly classified under Sub-Heading 2803.00 of the Tariff, as they were forms of carbon not elsewhere specified or included. The Revenue argued that Rule 4 of General Rules of Interpretation supported this classification, as the goods were akin to carbon products covered under Sub-Heading 2803.00. The Tribunal noted that while show cause notices were issued for classification under Tariff Heading 84.45, the Adjudicating Authority classified the goods under Sub-Heading 2803.00 without notifying the Appellants for reclassification under Chapter 28. Therefore, the Tribunal allowed the Appeal by way of remand, directing the Adjudicating Authority to reconsider the matter after providing a reasonable opportunity of hearing to the Appellants.

This judgment primarily deals with the classification of waste and scrap of baked and unbaked carbon under the Central Excise Tariff. The key issue revolved around whether the Adjudicating Authority's classification of the goods under Sub-Heading 2803.00 without prior notice to the Appellants for reclassification under Chapter 28 of the Tariff was valid. The Appellants argued that the Order was unsustainable as they were not given an opportunity to address the reclassification proposed by the Adjudicating Authority. Conversely, the Revenue contended that the goods fell under Sub-Heading 2803.00 as forms of carbon not elsewhere specified or included, supported by Rule 4 of General Rules of Interpretation. The Tribunal found that a reevaluation was necessary, as the Adjudicating Authority's decision was made without proper notice to the Appellants for reclassification under Chapter 28, leading to the Appeal being allowed by way of remand for a fresh decision after affording a reasonable opportunity of hearing to the Appellants.