2007 (3) TMI 50 - AT - Central Excise

Automobile parts Revenue contended that the assessee product (Various plastic components for use in automobiles) are not classifiable under CSH 87.08 and accordingly demand for differential duty Held appellant product classifiable under CSH 87.08

Summary

Issues: Correct classification of plastic components under Chapter Heading 87.08 and demand for differential duty.

In this case, the Revenue appealed against the order passed by the Commissioner of Central Excise (Appeals), Chennai, regarding the classification of plastic components under Chapter Heading 87.08 manufactured by M/s. Besmak Components (P) Ltd. The issue revolved around the correct classification of various plastic components used in automobiles. The impugned goods fell into three categories: moulded articles like housing, coupler, and connectors; items used in magneto assemblies; and parts used in car seat belts. The jurisdictional Assistant Commissioner dropped the proposal to reclassify these items under different headings and demand differential duty of Rs. 3,45,437. The Commissioner (Appeals) upheld the Assistant Commissioner's decision.

The lower appellate authority found that the plastic components were being supplied to units manufacturing automobile parts, not automobile manufacturing units. The goods in question did not fall under Chapter Sub Heading 85.44, which covers specific goods like insulated wire and cables, as they were parts and not covered under this heading. Similarly, the items used in magneto assemblies were found not to contain magnetic material and were not classifiable under CSH 85.05. The third category of goods, specifically designed for car seat belts, were considered tailor-made parts for automobiles and classifiable under Heading 87.08.

The grounds of appeal by the Revenue argued that the plastic components should be classified under different headings based on their use in wiring harness, magneto assemblies, and car seat belts. However, the Tribunal noted that as per section note 1(k) to Section XVI, parts of automobiles cannot be classified under Chapters 84 and 85 but should be classified under Section XVII. The Tribunal relied on the Apex Court's observation in a previous case, emphasizing that goods suitable for use solely or primarily with articles of specific headings should be classified accordingly. The Tribunal applied this guideline to classify the plastic components as parts of motor vehicles under Heading 87.08, in line with the judgment and dismissed the appeal filed by the Revenue.

In conclusion, the Tribunal upheld the impugned order and dismissed the Revenue's appeal, emphasizing the correct classification of plastic components under Chapter Heading 87.08 for use in automobiles.