1990 (10) TMI 176 - AT - Central Excise

Summary

Issues Involved:
1. Classification of PVC Insulated Galvanized Tinned Steel Wire under the erstwhile tariff and the new Central Excise Tariff 1985.
2. Applicability of Tariff Item 33B versus Tariff Item 68 under the erstwhile tariff.
3. Applicability of Heading 85.44 versus Heading 36.03 under the Central Excise Tariff 1985.
4. Binding nature of tariff advice issued by the Collectorate.
5. Relevance of Indian Standards Institution (ISI) specifications in classification.

Issue-wise Detailed Analysis:

1. Classification of PVC Insulated Galvanized Tinned Steel Wire:
The appeals arose from the classification of 'PVC Insulated Galvanized Tinned Steel Wire' under different tariff headings. The Assistant Collector classified it under Tariff Item 33B(ii) of the erstwhile tariff and Chapter 85.44 of the Central Excise Tariff 1985. The Collector (Appeals) reclassified it under T.I. 68 of the erstwhile tariff and Heading 36.03 of the Central Excise Tariff 1985. The Revenue appealed against this reclassification.

2. Applicability of Tariff Item 33B versus Tariff Item 68 under the erstwhile tariff:
The appellants argued that T.I. 33B covers insulated wires and cables of all metals, including those used for passing electric current, and thus, the product should fall under this item. They emphasized that T.I. 68 is a residuary item to be used only when no other specific tariff item is applicable. The respondents contended that for a product to be classified under T.I. 33B, its conductor must be copper or aluminum, and since the product is used exclusively in detonators, it should fall under T.I. 68.

3. Applicability of Heading 85.44 versus Heading 36.03 under the Central Excise Tariff 1985:
The Revenue argued that Heading 85.44 covers insulated wires, cables, and electric conductors, emphasizing their capability to conduct electric current. They cited HSN Explanatory Notes to support their claim. The respondents argued that the product is used exclusively in detonators and should be classified under Heading 36.03, which covers safety fuses and detonating fuses.

4. Binding nature of tariff advice issued by the Collectorate:
The respondents cited the CEGAT's decision in Rayalaseema Cable Corporation, asserting that the Assistant Collector was bound by the tariff advice issued by the Collectorate, which classified PVC insulated steel wires under T.I. 68.

5. Relevance of Indian Standards Institution (ISI) specifications in classification:
The Revenue cited case laws to argue that ISI specifications are relevant for the quality of goods but do not change the name or classification of the goods.

Majority Opinion and Conclusion:
The majority opinion favored the Revenue's classification under Heading 85.44. It was concluded that the product is an insulated wire and fits the description under Heading 85.44, which is broad enough to include wires fitted with connectors. The plea that Heading 36.03 applies was not sustained as the product is not a component of a detonator but an insulated wire. Thus, the appeal by the Revenue was allowed, and the cross-objections by the respondents were disposed of.

Separate Judgment by S.K. Bhatnagar, Member (T):
Contrary to the majority, S.K. Bhatnagar opined that the item should be classified under T.I. 68 of the erstwhile tariff and Heading 36.03 of the new tariff. He emphasized that the product is used in detonators and should be classified as such. He rejected the appeal, supporting the Collector (Appeals)'s classification.

Final Decision:
In view of the majority opinion, the appeal was allowed, classifying the product under Heading 85.44 of the Central Excise Tariff 1985.