1994 (12) TMI 167 - AT - Customs

Summary

Issues:
1. Assessment of Nickel Cadmium Cells under Customs Tariff
2. Applicability of Exemption Notification No. 172/77-Cus
3. Refund of countervailing duty under Exemption Notification No. 94/76-C.E

Assessment of Nickel Cadmium Cells under Customs Tariff:
The case involved the classification of Nickel Cadmium Cells imported by the appellants for walkie-talkie sets under the Customs Tariff. The respondent argued that the cells should be assessed under Heading 85.04 at a specific rate, citing a previous Tribunal decision. The Tribunal analyzed the nature of the cells and the relevant tariff headings. It noted that while the cells imported used Potassium Hydroxide as electrolyte instead of a liquid, they still fell under the category of "electric accumulators" covered by Heading 85.04. The Tribunal upheld the Revenue's classification under Heading 85.04 based on the statutory scheme of classification. The appeal was rejected concerning the assessment under Heading 85.04.

Applicability of Exemption Notification No. 172/77-Cus:
The appellants claimed that the Nickel Cadmium Cells should be assessed under Heading 85.05(1) with exemption under Notification No. 172/77-Cus. However, since the cells were classified under Heading 85.04 and not 85.15 as required by the exemption, the Tribunal ruled that the exemption was not applicable to the imported cells. Consequently, the assessment of basic customs duty under Heading 85.04 was confirmed, and the appeals related to basic customs duty were rejected.

Refund of Countervailing Duty under Exemption Notification No. 94/76-C.E:
In three specific appeals, the appellants sought a refund of countervailing duty under Notification No. 94/76-C.E, arguing that a lower duty rate should apply. The Tribunal clarified that the exemption was for metal jacketed dry batteries, not applicable to the rechargeable storage batteries like Nickel Cadmium Cells. However, considering the nature of the cells, the Tribunal ordered the re-assessment of countervailing duty under Item 31(2) of the Central Excise Tariff, which attracted a lower rate of 20%. The Tribunal directed the Revenue to provide the consequential refund to the appellants. Except for this relief in the mentioned appeals, all other appeals were rejected.

In conclusion, the Tribunal upheld the classification of Nickel Cadmium Cells under Heading 85.04 of the Customs Tariff, denied the applicability of exemption under Notification No. 172/77-Cus, and ordered a refund of countervailing duty under Item 31(2) of the Central Excise Tariff. The appeal was partly allowed, directing the Revenue authorities to provide the necessary relief as per the Tribunal's decision.