2004 (3) TMI 296 - AT - Central Excise

Summary

Issues: Classification of M.S. Galvanised Wires under Tariff Items 33B and 26AA

Detailed Analysis:
1. The case involved a dispute regarding the classification of M.S. Galvanised Wires manufactured and supplied by the appellants during 1981-82 and 82-83. The question was whether the wires should be classified under Tariff Item No. 33B as claimed by the Revenue or under T.I. No. 26AA as claimed by the assessee.

2. The initial decision by the Collector of Central Excise favored the Revenue, leading to a demand of duty against the assessee. Upon appeal, the High Court remanded the case to the Tribunal for a fresh decision on merits. The Tribunal was tasked with re-examining the evidence, particularly that of Shri K.R. Ramanujam, within a specified timeframe.

3. During the fresh hearing, the appellants argued that the wires were not suitable for transmitting electrical energy but were only used for information transmission in telephony and telegraphy. They emphasized that the burden of correct classification lay with the Revenue, and in this case, there was insufficient evidence to support classification under T.I. 33B.

4. The Revenue contended that the wires were described as 'telephone wires' in the contract and were used for telecommunication purposes, attracting duty as per relevant notifications. They challenged the reliability of Shri Ramanujam's evidence, citing a Supreme Court decision regarding the credibility of experts associated with the assessee.

5. The Tribunal analyzed the Tariff Entries 26AA and 33B to determine the appropriate classification. It noted that the unambiguous description under T.I. 33B covered electric wires and cables of various metals, including those with zinc coating. The Tribunal agreed with the Revenue's argument that the wires in question could conduct electricity, as acknowledged by the buyer's representative.

6. Shri Ramanujam's evidence was scrutinized, with the Tribunal concluding that his expertise in electrical engineering was questionable. His statements regarding the distinction between electrical and telecommunication wires lacked technical backing and were deemed unreliable, especially considering his association with the buyer.

7. The Tribunal rejected the appellants' reliance on ISI specifications, emphasizing that the clear description under T.I. 33B encompassed the galvanised steel wires in question. The contract terming the wires as "telephone wires" further supported their classification under T.I. 33B, as indicated by relevant notifications.

8. In light of the findings, the Tribunal upheld the classification of the wires under T.I. 33B of the old Central Excise Tariff. The demand of duty against the appellants was affirmed, and their plea of time-bar was dismissed due to undisputed facts regarding non-compliance with licensing and filing requirements.

9. Consequently, the Tribunal rejected the appeal and upheld the Collector of Central Excise's order, confirming the demand of duty against the appellants.