2007 (8) TMI 159 - AT - Central Excise

Crushing of betel nuts in to smaller pieces and sweetening etc. does not result in manufacture of new product Product rightly classified under 08029012 Classification under 8 digit can not be considered

Summary

Issues:
Classification of goods under the New Central Excise Tariff Act, 2004 - Discharge of duty liability - Contestation of classification by Revenue - Appeal by both Revenue and party - Application of 8 digit classification - Interpretation of judicial precedent by the Apex Court.

Analysis:
The case involved appeals by both the Revenue and the party regarding the classification of Betel Nut Pieces under the New Central Excise Tariff Act, 2004. The Revenue directed the appellants to classify their goods under Chapter Sub-Heading 21069030, but the Commissioner (Appeals) held that the product should be classified under Tariff Heading 03029012. The Revenue sought classification under the 8 digit, as per the New Tariff, while the Executive Commissioner initiated proceedings for re-classification. The issue revolved around whether the processes carried out by the assessee amounted to a process of manufacture, requiring acceptance of the new classification under 8 digits.

The party's advocate referred to a judgment by the Apex Court in the same case, where it was held that the end product, betel nut, remains the same even after processing, and there is no change in the end product's character. The advocate argued that the introduction of the 8 digit classification did not alter the existing 6 digit classification and that the Apex Court's judgment applied to the current case. The Commissioner (Appeals) also noted that the 8 digit classification did not affect the existing classification.

After considering the submissions and the Apex Court's judgment, the Tribunal concluded that the introduction of the 8 digit classification did not impact the case as the end product remained the same. Therefore, the Tribunal set aside the Revenue's classification under the 8 digit and allowed the party's appeal. The Revenue's appeal was dismissed as the Commissioner (Appeals) had correctly classified the goods under Tariff Heading 03029012. The judgment highlighted the importance of the Apex Court's decision and its application to the case at hand.

In conclusion, the Tribunal upheld the party's appeal, dismissed the Revenue's appeal, and emphasized that the introduction of the 8 digit classification did not change the classification of the goods. The judgment provided clarity on the classification of Betel Nut Pieces under the New Central Excise Tariff Act, 2004, based on the interpretation of the Apex Court's decision and the existing Tariff Headings.