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2003 (11) TMI 72 - SC - Central ExciseTyre cord warpsheets - Classification of goods - whether this item will fall within Tariff Item 22(1)(b) or whether it falls under Entry 16A(2) - Held that - interpretation placed by the Tribunal on the decision in Fenoplast (P) Ltd. is not correctly applied. It is also brought to our notice that the expression man-made fabric has been elaborated in Tariff Item 22 itself. It covers only situations such as fabrics impregnated, coated or laminated with preparations of cellulose derivatives or of other artificial plastic materials and fabrics covered partially or fully with textile flocks or with preparations containing textile flocks such as flock printed fabrics and flock coated fabrics. It cannot be disputed that the goods in question are not of that nature which can be termed as a preparation of cellulose derivatives or other artificial plastic material or fabrics covered partially or fully with textile flocks - Hence, Tariff Item 22 may not be attracted at all. Therefore, the Tribunal could not have entirely relied upon only Tariff Item 22 and adverted to a proviso made in that provision and interpreted the whole matter - Matter remanded back - Decided in favour of assessee.
Issues: Classification of goods under Tariff Item 22(1)(b) or Entry 16A(2)
The judgment deals with the classification of goods purchased by a tire manufacturer under Tariff Item 22(1)(b) or Entry 16A(2) of the Central Excise Tariff. The assessing authority classified the goods under Tariff Item 22(1)(b), while the Collector of Central Excise classified them under Entry 16A(2) as rubber products. The Tribunal referred to previous court decisions to determine the predominance of materials in the goods, particularly focusing on the fabric after dipping in Resorcinol Solution. The appellant argued that the Tribunal misinterpreted the decision in Fenoplast (P) Ltd. and highlighted that the goods did not fall under the definition of "man-made fabric" as per Tariff Item 22. The Supreme Court set aside the Tribunal's order, emphasizing that the goods did not align with the characteristics specified under Tariff Item 22, leading to a remittance for fresh consideration. The key issue in this case revolves around the correct classification of the goods purchased by the tire manufacturer under the Central Excise Tariff. The dispute arises between Tariff Item 22(1)(b) and Entry 16A(2) regarding whether the goods should be classified as man-made fabrics or as unhardened plates, sheets, and strips. The Tribunal's decision was based on the predominance of materials in the goods, specifically analyzing the fabric after being dipped in Resorcinol Solution. The appellant contested the Tribunal's interpretation of the previous court decision and argued that the goods did not meet the criteria for classification under Tariff Item 22 as "man-made fabric." The Tribunal's reliance on Tariff Item 22 and its interpretation of the materials' predominance led to the classification of the goods under Tariff Item 22(1)(b). However, the Supreme Court found that the goods did not fit the definition of "man-made fabric" as outlined in Tariff Item 22, which includes specific characteristics like being impregnated, coated, or laminated with certain materials. The Court highlighted that the goods in question did not exhibit these characteristics and, therefore, could not be classified under Tariff Item 22. Consequently, the Court set aside the Tribunal's order and remitted the matter for a fresh consideration in accordance with the law. In conclusion, the Supreme Court's judgment clarifies the classification of goods purchased by a tire manufacturer under the Central Excise Tariff. The Court emphasized that the goods did not meet the criteria for classification under Tariff Item 22 as "man-made fabric" due to the absence of specific characteristics outlined in the tariff provision. By setting aside the Tribunal's order, the Court directed a fresh consideration of the classification issue, highlighting the importance of aligning the goods' characteristics with the relevant tariff provisions for accurate classification and assessment of excise duties.
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