1997 (5) TMI 230 - AT - Central Excise

Summary

Issues:
Classification of densified wood in the form of sheets, blocks, plates for electrical insulation purposes under Chapter Heading 8546 or Chapter Heading 4409.

Analysis:
1. The issue pertains to the classification of densified wood used for electrical insulation. The material was classified under Chapter Heading 8546 by the authorities below, relying on a previous Tribunal decision. The Department argued that densified wood falls under Chapter Heading 40.09 as per Chapter Note 2 of Chapter 44, emphasizing the specific properties imparted by the formation method. The Department contended that the goods meet the parameters set out in Chapter Note 2 and should be classified under Chapter Heading 4409, excluding only items falling under Section XVI as per Note 1(k).

2. The Respondent's Advocate argued that insulating materials should be classified under Chapter Heading 8544, citing Chapter Note 1(k) under Chapter 44 to exclude densified wood with electrical insulating properties. Referring to previous case laws, the Advocate emphasized classifying goods based on their properties, asserting that the goods in question should be classified under Chapter Heading 8546. The Advocate relied on precedents related to insulating materials for support.

3. Upon careful consideration, the Tribunal found that the appellants' product fits the definition of densified wood under Chapter Note 2 of Chapter 44, intended for various purposes, including resistance to electrical agencies. The Tribunal noted that the goods fell under Chapter Heading 4409, as they matched the forms specified. The Tribunal disagreed with the Respondent's argument under Chapter Note 1(k), stating that the excluded items must correspond to examples in the note, which the goods in question did not.

4. The Tribunal differentiated the present case from a previous decision involving plastic laminates, highlighting the absence of a corresponding Chapter Note in Chapter 39 as in Chapter 44. The Tribunal emphasized the specific properties and formation process outlined in Chapter Note 2 of Chapter 44 for densified wood. It concluded that the reliance on Chapter Note 2(n) for exclusion under Chapter 39 was unfounded, as the goods did not match the description of excluded items. The Tribunal held that the goods should be classified under Chapter Heading 4409, allowing the appeal of the Revenue.