2010 (12) TMI 1211 - AT - Central Excise

Summary

Issues Involved:
1. Classification of the product under the Central Excise Tariff Act (CETA).
2. Applicability of the Board's order u/s 37B of the Central Excise Act.
3. Consideration of expert opinion and trade parlance in classification.

Summary:

1. Classification of the Product:
The primary issue revolves around the classification of the assessee's product, "Programmable Logic Controller" (PLC). Initially, the Assistant Commissioner classified the product under Heading 85.37 of the CETA Schedule. However, the Commissioner (Appeals) reclassified it under Heading 84.71, setting aside the original adjudication. The department's appeal contests this reclassification.

2. Applicability of the Board's Order u/s 37B:
The Revenue's appeal relies heavily on the Board's order dated 09/05/1997 issued u/s 37B of the Central Excise Act, which classified PLCs under Heading 85.37. The appellant argues that this order is binding on lower authorities, citing the Supreme Court's judgment in Ranadey Micronutrients vs. Collector of Central Excise. The Tribunal noted that the Assistant Commissioner had considered the Board's order in his adjudication.

3. Expert Opinion and Trade Parlance:
The Assistant Commissioner relied on an expert opinion stating that the PLC was not an 'automatic data processing machine' as per Heading 84.71. The assessee contested this, seeking cross-examination of the expert. The Commissioner (Appeals) favored the expert opinion provided by the assessee, which supported classification under Heading 84.71. The Tribunal emphasized the need to consider trade parlance and the Supreme Court's judgment in N.I. Systems India P. Ltd., which classified similar goods under CTH 90.32.

Conclusion:
The Tribunal set aside the impugned orders and remanded the case to the Commissioner (Appeals) for fresh adjudication. The lower appellate authority is instructed to consider the Board's order dated 09/05/1997, relevant product literature, trade parlance, and the Supreme Court's judgment in N.I. Systems case. The Commissioner (Appeals) must provide the assessee a reasonable opportunity of being heard before passing a new order.