1988 (10) TMI 145 - AT - Central Excise

Issues Involved:
1. Classification of steel panels, partitioned plates, and shelves.
2. Applicability of Tariff Item 40 vs. Tariff Item 68.
3. Interpretation of Notification 52/70 dated 1-3-1970.
4. Examination of the goods by authorities.
5. Relevance of previous judgments and CBEC's letter.

Detailed Analysis:

1. Classification of Steel Panels, Partitioned Plates, and Shelves:
The primary issue in the appeal is the classification of steel panels, partitioned plates, and shelves. The department contends these items are parts of steel furniture, given their special shape, which makes them identifiable as essential components of steel furniture. Consequently, they should be classified under Tariff Item 40 and not covered by the exemption Notification 52/70 dated 1-3-1970. The assessee, however, filed the classification list under Tariff Item 68 of the CET as it stood before 22-8-1986.

2. Applicability of Tariff Item 40 vs. Tariff Item 68:
The Assistant Collector of Central Excise initially classified the goods under Tariff Item 40, stating that the parts have a special design and structure, making them identifiable as essential components of steel furniture. On appeal, the Collector of Central Excise (Appeals) reclassified the goods under Tariff Item 68, arguing that the goods cannot be considered specially designed parts of steel furniture and merit classification under T.I. 68, as done by other manufacturers.

3. Interpretation of Notification 52/70 dated 1-3-1970:
Notification 52/70 exempts parts of steel furniture from duty unless they have been given a special shape or design, making them identifiable as essential components of steel furniture. The Tribunal noted that the notification requires parts to have a special shape or design and to be clearly identifiable as essential components of steel furniture to be liable for duty. The Tribunal found that the appellant-Collector did not specify what special shape or design the products had, which would make them essential components of steel furniture. The parts in question have multiple uses, and thus, even if they are treated as parts of steel furniture, they would be exempted by Notification 52/70.

4. Examination of the Goods by Authorities:
The Assistant Collector's order was based on a personal examination of the goods, concluding that the parts are identifiable as essential components of steel furniture. The Collector (Appeals) also examined the goods and concluded that they do not merit classification under T.I. 40. The Tribunal emphasized that in a hierarchical system, the conclusion of a superior authority (Collector (Appeals)) should prevail over that of a lower authority (Assistant Collector).

5. Relevance of Previous Judgments and CBEC's Letter:
The Tribunal considered previous judgments, including the Supreme Court and Bombay High Court decisions, which pertain to steel furniture and not parts of steel furniture. The Tribunal noted that the judgments cited by the learned consultant were not relevant to the issue of parts of steel furniture. The Tribunal also discussed the CBEC's letter dated 17-10-1968, which treats certain parts as furniture in unassembled condition if cleared in sets. However, the letter does not interpret the scope of Notification 52/70.

Conclusion:
The Tribunal concluded that the parts in question, having multiple uses, should not fall within the scope of the expressions "special shape or design" and "clearly identifiable as essential components of steel furniture." Therefore, even if they are treated as parts of steel furniture, they would be exempted by Notification 52/70. The Tribunal upheld the classification under Tariff Item 68 and rejected the appeal.

Cross-Objections:
The cross-objections, which prayed for sustaining the impugned order, were also disposed of in the same terms.

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