1992 (11) TMI 200 - AT - Central Excise

Summary

Issues:
Classification of Emery Millstones under Central Excise Tariff Act, 1985; eligibility for exemption under Notification No. 111/88; correct classification of millstones with frame work.

Analysis:
The appeal involved the classification of Emery Millstones under the Central Excise Tariff Act, 1985, and the eligibility for exemption under Notification No. 111/88. The appellants claimed that their millstones should be classified under sub-heading 6801.90 and be exempted. However, the lower authorities denied the exemption, leading to a series of adjudications and appeals. The appellants argued that since their millstones were fitted with frame work, they should be classified under Chapter 84 and be eligible for the exemption under Notification No. 111/88 as amended by Notification No. 141/88. The Collector (Appeals) remanded the matter to ascertain the claim's substantiation, which resulted in the Assistant Collector reaffirming the classification under sub-heading 6801.90 without the benefit of the exemption. The appeal against this decision was rejected by the Collector (Appeals), leading to the present appeal.

The main issue was whether the Emery Millstones, fitted with frame work, should be classified under sub-heading 6801.90 of the Central Excise Tariff Act, 1985. The Tariff Heading itself specified that classification under this sub-heading applied only to millstones without frame work. The Assistant Collector's observation during a factory visit confirmed that the millstones in question were indeed fitted with cast iron frame, indicating they fell outside the purview of sub-heading 6801.90. The HSN Explanatory Notes supported this by stating that such stones with frame work should be classified under Chapter 84 or 85, depending on their operation type. The literature on the millstones and a clarification from the Central Board of Excise and Customs further reinforced the argument that millstones with frame work should be classified under Chapter 84. Therefore, the classification of the goods under Chapter 68 was deemed unsustainable.

Additionally, the Assistant Collector had previously determined that the millstones were parts of flour mill machines, justifying their classification under sub-heading 8437.00. Consequently, the goods were deemed eligible for the exemption under Notification No. 111/88 as amended by Notification No. 141/88, as they fell under Chapter 84. The appeal was disposed of in favor of the appellants based on these findings.