1985 (7) TMI 229 - Commissioner - Central Excise

Summary

Issues: Classification of goods for concessional rate of duty under Notification No. 47/84

Analysis:
1. The appellant, M/s Aggarwal Wire Industries, filed an appeal against the order of the Assistant Collector denying them the concessional rate of duty of 5% under Notification No. 47/84 for their winding wires made of copper.
2. The appellant manufactures "Vindhya Brand" super enamel wires and sought total exemption of clearance value of Rs. 7 lakhs. The Assistant Collector provisionally approved their classification list but stated that the winding wires of copper are liable to pay duty at 10% under the notification.
3. The appellant argued that since their winding wires were made from bare copper wires, which were intermediary products made from duty-paid copper wire rods, they should be eligible for the concessional rate of duty. They contended that the notification did not specify that the winding wires should be made directly from wire rods.
4. The appellant explained the manufacturing process of enamelled copper wires and emphasized that the wire rods are an intermediary product necessary for making the winding wires. They also highlighted that other units in different jurisdictions were enjoying the concession, and hence, they should also be granted the same benefit.
5. The appellate authority, after considering the arguments, held that the appellant had a valid case. The notification did not require the winding wires to be made directly from wire rods, and the appellant's process of manufacturing from bare copper wires, derived from wire rods, satisfied the conditions of the notification.
6. The authority also noted that the burden of proof regarding the duty payment on wire rods rested with the department, and in this case, the appellants were willing to provide proof of payment of duty on the copper wires. Therefore, the authority allowed the appeal, setting aside the Assistant Collector's order, and directed the approval of the classification list for concessional duty at 5% under Notification No. 47/84.

This judgment clarifies the interpretation of the notification regarding the classification of goods for concessional duty rates and emphasizes the technological process involved in manufacturing as a determining factor for eligibility. It also highlights the burden of proof on the department regarding duty payment and the importance of considering the entire manufacturing process in determining eligibility for duty concessions.