2001 (7) TMI 185 - AT - Central Excise

Summary

Issues: Classification of dipped and rubberised nylon tyre cord fabrics under Central Excise Tariff Act, 1985.

Detailed Analysis:
1. Facts of the Case: The appellants, engaged in manufacturing tyres, tubes, and flabs, obtained tyre cord fabric for captive consumption in their factory. The fabric underwent processes like dipping, heat stretching, and rubberisation before being consumed in the manufacturing process. The Revenue contended that the dipped and rubberised fabrics were independent excisable goods classified under Heading 59.02, attracting additional excise duty. A show cause notice was issued, leading to a demand of duty and penalty imposed by the adjudicating authority.

2. Appellant's Argument: The appellant's advocate argued that previous tribunal decisions classified similar fabrics under Heading 59.06, exempting them from additional duty. The adjudicating authority's dismissal of these precedents was challenged, emphasizing that the goods should be classified under Heading 59.06, not 59.02.

3. Revenue's Stand: The Revenue's representative reiterated the department's classification stand.

4. Tribunal's Findings: The Tribunal noted that previous decisions classified similar fabrics under Heading 59.06, not 59.02. It referenced cases like Falcon Tyre Ltd. and Vikrant Tyres Ltd. where the classification under Heading 59.06 was upheld. The decision in Apollo Tyres Ltd. v. CCE further supported this classification, emphasizing adherence to higher forum decisions and Board clarifications.

5. Judicial Discipline: The adjudicating authority's refusal to follow the Apollo Tyres decision was criticized for lacking judicial discipline. The Tribunal emphasized that the classification of similar fabrics had been consistently upheld under Heading 59.06 in various cases, including MRF Ltd. v. CCE.

6. Final Decision: The Tribunal held that the dipped and rubberised nylon tyre cord fabrics were correctly classifiable under Heading 59.06, not 59.02. The confirmation of duty demand against the appellants was set aside based on the classification under Heading 59.06, exempting them from additional excise duty. The decision was supported by the consistent rulings of Co-ordinate Benches and binding judicial pronouncements.

This detailed analysis highlights the classification issue of dipped and rubberised nylon tyre cord fabrics under the Central Excise Tariff Act, emphasizing the Tribunal's reliance on precedent decisions and Board clarifications to determine the correct classification under Heading 59.06, ultimately setting aside the duty demand against the appellants.