2017 (4) TMI 208 - AT - Central Excise

Question of fact - whether the appellant is manufacturing ceramic tiles or not? - Held that - the appellants are manufacturing the bricks for construction purpose which exempted under N/N. 5/2006-C.E., dated 1-3-2006 - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Appeal against impugned order demanding duty
- Determination of whether the appellant is manufacturing ceramic tiles or clay bricks/tiles

Analysis:
The appellant, engaged in manufacturing various tiles, faced a demand for duty under Chapter 69 of the Central Excise Tariff Act, 1985, on the grounds of allegedly manufacturing ceramic tiles. The appellant contended that they were producing clay bricks/tiles manually and mechanically from locally available clay, used for construction purposes. The dispute revolved around whether the appellant's products should be classified as ceramic tiles or clay bricks/tiles. The case was presented as a fact-based inquiry to ascertain the nature of the appellant's manufacturing activities.

The appellant's counsel argued that the case hinged on determining whether the appellant was indeed manufacturing ceramic tiles. On the other hand, the learned AR objected, suggesting that the matter was about classification and should be heard by the Division Bench of the Tribunal. However, the Member (J) clarified that the issue was not one of classification but rather a factual determination regarding whether the appellant's products were ceramic tiles. Consequently, the case proceeded for resolution based on the facts presented.

During the proceedings, the appellant's counsel presented the manufacturing process, emphasizing the nature of the products being manufactured. The Order-in-Appeal highlighted that the appellant's products, identified as building bricks for construction purposes, were classified under heading 69.04 and exempted under Notification No. 5/2006-C.E. The Commissioner (Appeals) concluded that the appellant's manufacturing activities aligned with the production of bricks for construction, leading to the setting aside of the impugned order demanding duty. The final decision favored the appellant, emphasizing the exemption applicable to the products manufactured for construction purposes, as per the relevant notification.

In conclusion, the judgment resolved the appeal against the duty demand by determining that the appellant's manufacturing activities aligned with the production of bricks for construction purposes, exempting them from the duty under the specified notification. The case underscored the importance of factual assessment in distinguishing between ceramic tiles and clay bricks/tiles for classification and duty purposes.