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2017 (5) TMI 754 - AT - Central ExciseClassification of manufactured goods - Orthopaedic Heating Pads/Belts/Bands - classifiable under CTH 9021 10 00 or under CTH 3005 90 40? - Held that - It can be seen from the HSN explanatory note to Chapter Heading No. 9021 at Sr. No. 111 it indicate that the belts would fall under Orthopaedic appliances which are used for the purpose of diagnosis - the HSN explanatory note also supports the case of the assessee for the classification the product under Chapter Heading No. 9021. We also find support in the dictionary meaning of the words orthopaedic and appliances - If orthopaedic appliance has to be understood in a common sense it would be an appliance which is used for prevention or correction of disorders of the muscles joints ligaments which in the given case is not disputed that the orthopaedic heating belts are used for the purpose of treating or giving relief from swelling pain etc. Classification of Bandages - the Department s stand is that the item is classifiable under Tariff Entry No.3005 90 40 of Central Excise Tariff and is chargeable to duty. On the other hand the appellant s stand is that they are not manufacturing such bandages but are trading in the same in the ordinary course of resale trade - appellant s contention is that since they do not manufacture the subject goods on which the duty has already been paid the question of demand of duty on such bandages does not arise - Held that - On this issue also the Tribunal has given the decision in same case of Ascent Meditech Ltd. 2015 (8) TMI 1122 - SUPREME COURT where it was held that the submission of ld. counsel that they are not doing any activity seems to be correct as the adjudicating authority has not recorded any finding to indicate that the appellant herein was undertaking further activity in his factory premises on the bandages which are received from the job worker in duly packed form. In the absence of any activity on such finished goods in our view the said product cleared from the factory premises as such cannot be subjected to any duty as Central Excise duty is on manufacture. Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Classification of Orthopaedic Heating Pads/Belts/Bands. 2. Demand of duty on Bandages. Detailed Analysis: 1. Classification of Orthopaedic Heating Pads/Belts/Bands: The primary issue revolves around the classification of Orthopaedic Heating Pads/Belts/Bands. The appellant classified these products under Tariff Item 9021 10 00 of the Central Excise Tariff Act, 1985, which carries a nil rate of duty. Conversely, the Department proposed classifying "Heating Belts" under Tariff Item 9018 90 99 as "other Electro-Medical Apparatus/Appliances" and "Bandages" under Tariff Item 3005 90 40, both of which are chargeable to duty. The Tribunal found the matter to be covered by its previous decision in the appellant's own case (Ascent Meditech Ltd. vs. C.C.E., Vapi - 2014 (309) ELT 712 (Tri-Ahmd.)), which was affirmed by the Hon’ble Supreme Court (C.C.E. vs. Ascent Meditech Ltd. - 2015 (320) ELT A281 (SC)). The Supreme Court dismissed the Department's appeal, stating that it was "devoid of any merit." The Tribunal's decision emphasized several points: - The products are marketed as orthopaedic heating belts recommended for relief from swelling and pain. The adjudicating authority's reliance on Chapter Note 6(i) of Chapter 90 was deemed misplaced, as it pertains to preventing or correcting bodily deformities, which can include internal issues like swelling and pain. - Certificates from practicing orthopaedicians indicated that the belts are recommended for treating swelling and pain. The adjudicating authority's dismissal of these certificates was incorrect. - The classification under Chapter Heading 9018 was found inappropriate, as it pertains to instruments and appliances used for diagnosis, which does not apply to orthopaedic heating belts. - The HSN explanatory notes supported the classification of the product under Chapter Heading 9021, which covers orthopaedic appliances designed for preventing or correcting bodily deformities or supporting organs after illness or operation. The Tribunal concluded that the specific heading (9021) should prevail over the general heading (9018), and the product merits classification under Tariff Item 9021 10 00. 2. Demand of Duty on Bandages: The Department contended that bandages should be classified under Tariff Entry 3005 90 40 and be chargeable to duty. The appellant argued that they do not manufacture these bandages but trade them, receiving them in packed condition from various manufacturers who have already paid the appropriate duty. The Tribunal referenced its decision in the appellant's previous case, which was affirmed by the Supreme Court. It was observed that the bandages were received in completely packed condition from job workers, and no further manufacturing activity took place at the appellant's premises. Therefore, the bandages could not be subjected to any additional duty as Central Excise duty is levied on manufacture. Conclusion: The Tribunal set aside the impugned order and allowed the appeal with consequential relief to the appellant. The classification of Orthopaedic Heating Pads/Belts/Bands under Tariff Item 9021 10 00 was upheld, and the demand of duty on bandages was dismissed due to the lack of manufacturing activity by the appellant.
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