1987 (7) TMI 449 - AT - Central Excise

Summary

Issues:
Classification of steel products as parts of steel furniture under item 40 CET.

Analysis:
The case involved a dispute regarding the classification of steel products manufactured by a company as parts of steel furniture under item 40 CET. The show cause notice issued to the company raised concerns about the classification of various products like slotted panels, strips, corner plates, cladding sheets, and metal shoes. The Assistant Collector initially classified these products, except slotted angles and channels, as parts of steel furniture under item 40 CET. However, the Collector of Central Excise (Appeals) overturned this decision, stating that the products could not be identified as parts of steel furniture.

Upon appeal, the Appellate Tribunal considered the arguments presented by both sides. The Department contended that the products were capable of being used for assembling steel furniture and should be classified as such. In contrast, the company argued that the products were primarily used for erecting industrial storage counters, ladders, catwalks, and platforms, making them unsuitable for classification as parts of steel furniture.

The Tribunal examined letters from purchasers indicating the intended use of the products, such as fitting racks in stores and erecting storage racks. The respondents also provided photographs of the storage systems constructed using the products in question. The Tribunal noted that while the products could be used for various purposes, including manufacturing storage racks and catwalks, their classification as parts of steel furniture was appropriate.

In its analysis, the Tribunal referenced a previous judgment by the Gujarat High Court, which held that shelving racks constituted steel furniture regardless of their size. The Tribunal distinguished a case involving seats in buses, emphasizing that the intended use and permanence of installation were crucial factors in determining classification. Additionally, the Tribunal dismissed the relevance of a trade notice concerning mild steel ladders, as it did not pertain to the classification of individual parts.

The Tribunal also addressed the respondents' reliance on a government decision regarding cinema chairs, emphasizing the distinction between movable and fixed furniture. Furthermore, the Tribunal discussed a case involving trolleys and other items, highlighting the specific use and purpose of such products in determining their classification.

After considering all arguments and evidence, the Tribunal concluded that the Assistant Collector's classification of the products under item 40 CET was correct. The Tribunal overturned the decision of the Collector (Appeals) and reinstated the original classification, affirming that the products were indeed parts of steel furniture.

In summary, the judgment resolved the classification dispute by affirming the classification of the steel products as parts of steel furniture under item 40 CET, based on their intended use and compatibility with the definition of steel furniture.