1997 (8) TMI 224 - AT - Central Excise

Summary

Issues: Classification of yarn under Tariff Item, Mis-declaration of material in blended yarn, Reliability of chemical test results, Equipment availability for testing material composition

In this case, the appellant filed an appeal against the order-in-original passed by the Collector of Central Excise confirming a demand under Section 11A of the Central Excise and Salt Act, 1944, along with confiscation of goods and imposition of a penalty. The appellant, engaged in manufacturing blended yarn, had goods seized by officers, leading to chemical tests on samples. The Deputy Chief Chemist's report found discrepancies in 11 samples. A show cause notice was issued, resulting in the Collector's order confirming the demand. The Tribunal initially set aside the order for re-examination. The appellant argued that retesting favored them and cited a previous case for classification under a different tariff item. The respondent contended that misdeclaration of material was proven by the evidence and the Chemical Examiner's report. The Collector's order relied on mixing reports to classify the yarn under a specific tariff item, despite equipment limitations in determining material composition during testing.

The main contention revolved around the classification of the yarn under a specific tariff item. The appellant argued for a different classification based on retesting results and a previous case precedent. The respondent maintained that misdeclaration was evident, supported by the Chemical Examiner's report. The Collector's reliance on mixing reports for classification was challenged due to equipment limitations impacting the testing process. Ultimately, the Tribunal set aside the Collector's order and allowed the appeal based on inconsistencies in the mixing reports and the lack of equipment for accurate material determination during testing.