1999 (5) TMI 139 - AT - Central Excise

Summary

Issues:
Classification of floor coverings as felt under sub-heading 5602.90, marketability of the items.

Classification Issue Analysis:
The appellants sought restoration of the original classification of floor coverings under sub-heading 5602.90, arguing that the items were felt before latexing and only became floor coverings after the latexing process. They relied on HSN Explanatory Notes to support their claim. The impugned order, however, held that the items did not meet the requirements for classification as felt under sub-heading 5602.90. It noted that the items were not recognized as felt in the market or technically, as evidenced by opinions from I.I.T., Delhi, and traders. The Assistant Collector emphasized that the items did not fall under the definition of felt as per generally accepted identity or needle loom felt. The order concluded that the items were not marketable as felt at the stage they were cleared from the factory.

Marketability Issue Analysis:
The impugned order not only addressed the classification issue but also ruled on the marketability of the items. It highlighted that the goods were not marketable as felt, a crucial factor for determining excisability. The appellants failed to contest the finding that the items were not marketable. The Tribunal emphasized that marketability is essential for assessing Central Excise Duty, citing past decisions. Technical and commercial evidence presented by the respondents supported the claim that the items were not recognized as felt in the market. As the goods were deemed non-marketable, the Tribunal upheld the impugned order, dismissing the appeals and confirming the decision based on the lack of marketability alone.

In conclusion, the judgment by the Appellate Tribunal CEGAT, New Delhi addressed the issues of classification and marketability of floor coverings. It delved into the arguments presented by both parties regarding the classification under sub-heading 5602.90 and the marketability of the items. The Tribunal upheld the impugned order based on the crucial factor of marketability, as the goods were not deemed marketable as felt at the stage of their removal for further processing. The decision emphasized the significance of marketability in determining excisability, ultimately leading to the dismissal of the appeals.