1997 (1) TMI 268 - AT - Central Excise

Summary

Issues:
Eligibility of goods for exemption under Notification No. 158/86-C.E. dated 1-3-1986 based on the classification of Clock Radio two bands under Heading No. 85.27 of the Central Excise Tariff Act, 1985.

Analysis:
The appeal involved the eligibility of Clock Radio two bands for exemption under Notification No. 158/86-C.E. dated 1-3-1986. The Collector of Central Excise (Appeals) had previously held that the combination of radio and clock did not qualify for the exemption as the notification only covered radios and transistor sets without additional features like a clock. The appellant argued that the combination should be considered a radio and therefore eligible for the exemption. They cited a Tribunal decision in a similar case involving Philips India Ltd. and referred to Supreme Court decisions to support their argument.

The respondent contended that the exemption must be strictly construed, and the notification specifically mentioned radios and transistor sets without reference to combinations with clocks. They argued that the exemption under Notification No. 158/86-C.E. did not extend to combinations like Clock Radio two bands. The respondent distinguished the case from the Tribunal's decision involving Philips India Ltd. by pointing out the different wording of the relevant exemption notifications.

Upon careful consideration, the Tribunal noted that the classification list described the products as a combination of radio and clock under Heading No. 85.27 of the Tariff. The Tribunal analyzed the wording of Notification No. 158/86-C.E. and observed that the exemption was limited to radios and transistor sets, with different duty rates for sets of one or two bands compared to others. The Tribunal emphasized that the exemption did not cover combinations like Clock Radio two bands, as the notification's language was clear and unambiguous.

The Tribunal distinguished the Tribunal's previous decision in a different case involving a similar issue under a different notification. They emphasized that the interpretation of the exemption notification should be based on its explicit language without extending it to cover combinations, as it would defeat the purpose of the exemption for radios and transistor sets. Consequently, the Tribunal upheld the Collector of Central Excise (Appeals)' view that the exemption could not be extended to combinations like Clock Radio two bands, and the appeal was rejected.