2006 (9) TMI 183 - SC - Central Excise

Whether the goods manufactured by the appellant falls within the purview of insulated wires or not? Held that - Keeping in view the circulars of the Board dated 29-8-1964 and 23-9-1975 it appears that the authorities did not apply their mind on this aspect of the matter. We are, therefore, of the opinion that it would be in the interest of justice to remit the matter back to the Commissioner of Central Excise and we direct accordingly. The impugned orders are set aside. All the contentions of the parties shall remain open. If the parties so desire, they may file appropriate applications for adduction of additional evidence before such authority which may be considered on their own merits.

Summary

Issues:
1. Applicability of Tariff Item Nos. 26AA(1a) or 33B of the Central Excise & Salt Act, 1944 to goods manufactured by the appellant.

Detailed Analysis:
The appeal in question pertains to the applicability of Tariff Item Nos. 26AA(1a) or 33B of the Central Excise & Salt Act, 1944 to goods manufactured by the appellant. The case originated from a judgment and order passed by a learned Single Judge of the M.P. High Court, Indore Bench, in Writ Petition No. 881/2004. The appellant, a manufacturer of galvanized steel wire, received an order from the Posts and Telegraph Department of the Union of India for telecommunication purposes. The dispute arose when a show cause notice was issued to assess the manufacturer's case under TI 33B instead of TI 26AA(1a) due to supplies made to the Department. The High Court dismissed the writ application filed by the appellant against the order passed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), emphasizing the Tribunal's factual findings based on material evidence.

Further examination revealed a notification exempting wires and cables under sub-item (i) of Item No. 33B from excess excise duty, along with circular letters clarifying the classification of electric wires and steel wires under the respective tariff items. The Supreme Court noted that the lower authorities did not consider the applicability of the notification and circulars. The Court highlighted the need to determine if the appellant's products fell within TI 33B or TI 26AA to ascertain excise duty liability, emphasizing the importance of factual analysis.

The Court delved into the definitions of Tariff Item 26AA and 33B, emphasizing the distinction between iron/steel products and electric wires/cables. The Additional Solicitor General argued that Entry 33B encompassed not only copper or aluminium but also other metals and alloys, raising the crucial question of whether the appellant's goods qualified as insulated wires. The Court stressed the necessity of establishing a factual basis for this determination, noting the oversight in considering the relevant circulars.

Ultimately, the Supreme Court set aside the impugned orders and remitted the matter back to the Commissioner of Central Excise for a fresh assessment. All contentions of the parties were to remain open, allowing for the submission of additional evidence if desired. The appeal was disposed of with these directions, and no costs were awarded in the case.