2009 (2) TMI 290 - AT - Central Excise

Fabric - The issue for consideration in this case is the classification of Cotton Bleached Mosquito Net Fabrics which the Department proposes to consider as Bleached Leno Gauze fabric and classify the same under CETH 58.03 whereas the respondent had classified it under CETH 52.07. Revenue sought classification as leno gauze babric relying on test report and statement of MD MD has admitted that fabric are woven as per leno weave method - Note below Chapter 5803 is applicable only to plain weave fabrics and not leno weave fabrics which is the fabric under consideration in this case. - the product is classifiable under 5803 - since revenue not included in appeal the persons on whom penalty imposed and buyer from whom goods confiscated, we hold that penalty was rightly set aside by Commissioner

Summary

Issues:
Classification of Cotton Bleached Mosquito Net Fabrics under CETH 58.03 or CETH 52.07.

Analysis:
The case involves the classification of Cotton Bleached Mosquito Net Fabrics by the Department as Bleached Leno Gauze fabric under CETH 58.03, while the respondent classified it under CETH 52.07. The Department argued that the fabric was actually Leno gauze, supported by statements and evidence indicating misdeclaration to avoid duty payment. The Advocate for the respondents contended that gauze fabrics should be classified under chapters 50 to 55 and not under 58.03, emphasizing common end use for bandages. The Chemical Examiner's report and technical aspects were crucial in determining the classification. The Tribunal analyzed chapter notes, technical definitions, and statements to conclude that the product was leno gauze fabric woven using leno weave method, falling under CETH 58.03. The Tribunal upheld the Commissioner's decision, setting aside penalties and confiscation related to the case. The order regarding stiffened fabrics (buckram) was not challenged and remained undisturbed. The judgment was pronounced on 27-2-2009.