2004 (8) TMI 296 - AT - Central Excise

Summary

Issues:
Classification of Mechanical Equipments for Hot Strip Mill under sub-heading No. 8455.10 or 8455.90 of the Central Excise Tariff Act.

Analysis:
The appeal involved a dispute regarding the classification of Mechanical Equipments manufactured by a company for a Hot Strip Mill. The company claimed the goods should be classified under sub-heading No. 8455.10, while the Commissioner (Appeals) classified them under sub-heading No. 8455.90 of the Tariff.

The company's advocate argued that the goods supplied were auxiliary equipment of a rolling mill and should be classified under sub-heading 8455.10. He emphasized that the goods independently performed specific functions in a rolling mill, citing relevant HSN notes and a previous tribunal decision supporting this classification.

The advocate further contended that the statutory rules of interpretation and HSN explanatory notes should guide the classification process. He refuted the Commissioner's assertion that only a complete rolling mill could be classified under sub-heading 8455.10, emphasizing the essential character of the goods supplied.

In response, the SDR argued that the company did not supply complete metal rolling mills but only parts, supporting their classification under sub-heading 8455.10. She highlighted the functions of the items supplied and questioned the alignment of Heading 84.55 with HSN.

The Tribunal analyzed the submissions and noted that the company did not supply complete rolling mills but provided specific mechanical plant and equipment for the Hot Strip Mill. Rule 2(a) for interpreting incomplete goods was deemed inapplicable as the supplied goods did not possess the essential character of a complete rolling mill.

The Tribunal found that the goods could not be classified as a complete rolling mill under sub-heading 8455.10. It differentiated between auxiliary equipment and parts of rolling mills, remanding the matter to the Commissioner (Appeals) for a decision after considering whether the goods were auxiliary equipment or parts.

In conclusion, the Tribunal clarified the classification criteria under the Central Excise Tariff Act, emphasizing the distinction between complete rolling mills and parts or auxiliary equipment. The case highlighted the importance of statutory rules of interpretation and HSN notes in determining the appropriate classification of goods under the tariff.