1991 (11) TMI 142 - AT - Central Excise

Summary

Issues: Classification of manufactured items under Central Excise Tariff, Jurisdiction of Rule 10A, Time-barred demand

In this case, the Appellate Tribunal CEGAT, New Delhi, dealt with an appeal challenging the reclassification of two items manufactured by the appellants, namely a Nut Bearing Lock and a Nut King Pin Thrust Bearing. The lower authorities had sought to classify these items under Item 52 as Bolts, Nuts, and Screws instead of under Item 68 of the Central Excise Tariff. The dispute arose from a show cause notice issued by the Inspector of Central Excise, alleging a wrong classification and demanding duty payment. The appellants argued that the parts were not classifiable as nuts and bolts under Item 52 due to their specific use in loaders and dumpers. They contended that the parts were known by their product numbers and were not sold separately in the market. The Assistant Collector and Collector (Appeals) upheld the reclassification under Item 52, emphasizing the primary function of the parts as fasteners. The appeal before the Tribunal raised issues regarding the primary function of the parts, the jurisdiction of Rule 10A, and the time-barred nature of the demand. The appellants argued that the parts did not primarily function as fasteners and that the demand under Rule 10A was invalid due to its deletion and being time-barred. However, the Tribunal, considering the nomenclature and function of the parts, upheld the reclassification under Item 52, concluding that they were correctly classifiable as nuts and bolts. Regarding the jurisdiction of Rule 10A, the Tribunal noted that the deletion of the rule did not invalidate the demand as the provisions were subsumed under amended Rule 10. Citing precedent cases and the Collector (Appeals) decision to limit the demand period, the Tribunal rejected the appeal, affirming the classification under Item 52 and the validity of the demand.