1997 (1) TMI 537 - AT - Central Excise

Summary

Issues Involved:
1. Classification of precured treads under the appropriate tariff heading.
2. Interpretation of Chapter Note 9 of Chapter 40.
3. Applicability of Notification 71/68 and Notification 377/86.

Issue-Wise Detailed Analysis:

1. Classification of Precured Treads:

The appellants manufacture precured treads used in retreading of tyres and classified them under Tariff Heading 4016.99 of the CETA, 1985. The original authority classified the goods under Heading 4008.21, relying on Note No. 9 of Chapter 40, which includes products cut to shape and further worked to render them fit for resoling or repairing or retreading of rubber tyres. The CCE (A) upheld this classification.

2. Interpretation of Chapter Note 9 of Chapter 40:

The appellants argued that their product is a profile shape and not plates, sheets, or strips, and thus should not fall under Heading 4008.21. They contended that the burden of proof lies on the Revenue to show that the goods can be treated as plates, sheets, and strips. The Tribunal noted that the amendment to Note 9 in 1990 was intended to broaden the scope of Heading 4008.21 to include plates, sheets, and strips that have been cut to shape or further worked for resoling, repairing, or retreading of rubber tyres. The Tribunal concluded that the appellants' products, which are manufactured from strips and sheets and further worked by moulding, fall within the ambit of Heading 4008.21.

3. Applicability of Notification 71/68 and Notification 377/86:

In Appeal No. E/5448/91, the appellants sought the benefit of Notification 71/68, which was denied. They argued that they are entitled to the benefit of Notification 377/86, which was not considered by the lower authority. The Tribunal remanded the matter to the original authority for consideration of Notification 377/86, after affording an opportunity of hearing to the appellants.

Conclusion:

The Tribunal dismissed the appeals and upheld the classification of the goods under Heading 4008.21. The decision is effective from the date the Finance Bill received the President's assent. The matter regarding Notification 377/86 was remanded to the original authority for fresh consideration.