1996 (10) TMI 241 - AT - Central Excise

Summary

Issues: Classification of products under different headings, application of Section Note 2 under Section XVI of the Schedule to the Central Excise Tariff Act, 1985, classification of specific goods under Heading No. 84.83, classification of shafts, couplings, claw clutches, and pinions.

In the case, M/s. Chamundi Machine Tools Limited appealed against the Order-in-Appeal passed by the Collector of Central Excise (Appeals), Madras regarding the classification of products like gears, shafts, pulleys, couplings, claw clutches, pinions, bearings, and housings. The appellant classified these products under Heading No. 84.66, while the department classified them under Heading No. 84.83. The main contention was whether these products should be classified under Heading No. 84.66 or Heading No. 84.83. The respondent argued that as per Section Note 2 under Section XVI of the Central Excise Tariff Act, parts included in Chapter 84 or Chapter 85 should be classified in their respective headings, and since the parts were covered by the description against Heading No. 84.83, they should be classified there. The Tribunal noted that the goods gears, bearings, housings, and pulleys were specifically covered by the description against Heading No. 84.83. However, shafts, couplings, claw clutches, and pinions did not precisely match the description under Heading No. 84.83.

Regarding the classification of shafts, the Tribunal found that the specific descriptions of shafts provided did not align with Heading No. 84.83, leading to the conclusion that these shafts may not be classified under Heading No. 84.83 but under Heading No. 84.66 as parts suitable for use with lathes. Similarly, couplings, claw clutches, and pinions were also analyzed. While clutches and shaft couplings were covered under Heading No. 84.83, the goods in question were referred to as couplings and claw clutches only. The Tribunal accepted the argument that clutches as a general term would include claw clutches and that shaft couplings as a general term would encompass couplings. Thus, these items were classified under Heading No. 84.83. However, pinions were not covered by any named goods under Heading No. 84.83 and were rightly classified under Heading No. 84.86.

The Tribunal summarized the classification as follows: bearings, housings, pulleys, couplings, and claw clutches were rightly classified under Heading No. 84.83, while shafts and pinions were classified under Heading No. 84.66. Additionally, the Tribunal rejected the appellant's plea regarding the calculation of demand for 6 months from the date of the impugned order-in-appeal, stating that the period of limitation should be governed by the relevant provisions of Section 11A of the Central Excises and Salt Act. The impugned Order-in-Appeal was modified accordingly, and the appeal was rejected, subject to the above classification analysis.