1989 (12) TMI 199 - AT - Central Excise

Summary

Issues:
Classification of Permaline Hose Pipe under Heading 59.07/sub-heading 5907.00 or under Heading 40.09 sub-heading 4009.92 of the Schedule to the Central Excise Tariff Act, 1985.

Analysis:

Issue 1: Classification of Permaline Hose Pipe
The case involved the classification of Permaline Fire Hose Pipe manufactured by the appellants under the Central Excise Tariff Act, 1985. The dispute arose when the Assistant Collector classified the product under Heading 4009.92, which was upheld by the Collector (Appeals), Calcutta. The appellants claimed the correct classification should be under Heading 59.07 chargeable at a lower duty rate of 12% ad valorem. The product in question was a synthetic jacket woven with rubber/PVC compound, retaining the essential characteristic of a textile hose pipe.

Issue 2: Interpretation of Tariff Entries
The tribunal analyzed the conflicting tariff entries under Heading 40.09 and Heading 59.07 to determine the appropriate classification. Heading 40.09 covered tubes, pipes, and hoses of vulcanized rubber, excluding textile materials waterproofed with rubber, falling under Heading 59.09. The product in dispute was a textile tube coated with rubber on both sides, not falling under the purview of Heading 40.09, which specifically pertained to rubber products.

Issue 3: Application of Explanatory Notes
The tribunal referred to the Explanatory Notes to the Harmonized Commodity Description and Coding System to support the classification under Heading 59.07. The notes clarified that textile hose piping and similar tubing, even if coated with rubber, are classified under Heading 59.07. The product's classification under Section XI as a textile article further supported its exclusion from Chapter 40, as per Chapter Note 2(a).

Issue 4: Judicial Interpretation
The tribunal disagreed with the Collector's interpretation that a textile hose pipe with rubber coating on both sides could not be classified under Heading 59.07. It emphasized that the product's textile nature, coated with rubber, aligned with the description under Heading 59.07. The Department's own classification under Trade Notice No. 119/89 supported the appellants' position for classification under Heading 59.07.

Conclusion
The tribunal held that the Permaline Fire Hose manufactured by the appellants, being a textile hose coated with rubber, was correctly classifiable under Heading 59.07 of the Central Excise Tariff Act, 1985. The impugned order was set aside, and the appeal was allowed in favor of the appellants, granting consequential relief.