2001 (9) TMI 159 - AT - Central Excise

Summary

Issues:
1. Correct classification of Air Pillow and Air Mattress manufactured by the appellants.
2. Dispute over classification under Chapter 42, Chapter 63, and Heading 4016.
3. Interpretation of Chapter Note 3 of Chapter 59.
4. Classification under Chapter 40 and Chapter 63.

Issue 1: Correct Classification of Air Pillow and Air Mattress:
The dispute in the appeal revolves around the classification of Air Pillow and Air Mattress manufactured by the appellants. Initially, the Revenue authorities accepted the classification under Chapter 42 as 'Travel goods'. However, the Assistant Commissioner classified the products under Heading 4016, leading to a demand for duty. The appellants argued for classification under Chapter 63 as 'made up articles of textile', citing that the goods are manufactured from rubberized textile fabrics classified under Chapter 59.

Issue 2: Dispute Over Classification Under Chapter 42, Chapter 63, and Heading 4016:
The appellants initially sought classification under Chapter 42 but later contended for classification under Chapter 63 during adjudication. They argued that since the rubberized textile fabrics used in manufacturing the goods are classified under Chapter 59, the Air Pillow and Air Mattress should be classified under Chapter 63 as made up textile articles. The Assistant Commissioner did not accept this argument, leading to the appeal.

Issue 3: Interpretation of Chapter Note 3 of Chapter 59:
The appellants claimed that the rubberized textile fabrics used in manufacturing the goods were classified under Heading 59.05 by the Revenue. They referred to an order by the Commissioner of Central Excise supporting this classification. The Assistant Commissioner, however, interpreted Chapter Note 3 of Chapter 59 to exclude fabrics weighing less than 1500 gm per square meter and where rubber predominates by weight from Heading 59.05.

Issue 4: Classification Under Chapter 40 and Chapter 63:
The judgment analyzed the classification under Chapter 40, which covers vulcanized rubber goods, and Chapter 63, which includes made up textile articles. It was established that the Air Pillow and Air Mattress, made from rubberized textile fabrics classified under Chapter 59, do not fall under vulcanized rubber goods of Chapter 40. Considering the exclusion of textile articles from Chapter 40 and the proper classification of the goods under Heading 6301.00, the appeal was disposed of in favor of the appellants.