2000 (2) TMI 382 - AT - Central Excise

Summary

Issues:
1. Classification of scrap rubberised bead wires under Heading No. 40.04 or sub-heading 7204.90.
2. Classification of scrap rubberised steel belt fabrics under Heading 40.04 or Heading 72.04.

Issue 1: Classification of scrap rubberised bead wires
The appellant, M/s. CEAT Ltd., challenged the classification of scrap rubberised bead wires under sub-heading 7204.90 by the Collector of Central Excise, Aurangabad. The dispute revolved around whether the scrap should be classified under Heading No. 40.04 of the Central Excise Tariff Act (C.E.T.A) as claimed by the assessee or under sub-heading 7203.20 for a specific period. The appellant argued that the scrap arose from the working of rubber and rubber goods, making it suitable for classification under Heading 40.04. The advocate highlighted that the Department had previously approved the classification under Heading 40.04. Reference was made to a previous order-in-appeal classifying similar scrap under Heading 40.04. The advocate also relied on legal provisions and case law to support the classification under Heading 40.04. The Revenue, however, contended that the scrap was predominantly metal, intended for metal recovery, and thus should be classified under Chapter 72. The Tribunal analyzed the arguments and precedent cases, ultimately deciding in favor of the appellant, holding that the scrap of rubberised bead wires was not chargeable to excise duty.

Issue 2: Classification of scrap rubberised steel belt fabrics
The second appeal involved the classification of scrap rubberised steel belt fabrics. The Revenue disputed the classification under Heading 40.04, advocating for classification under Heading 72.04. The appellant had initially classified the scrap under a specific heading, which was later contested by the Revenue. The Collector (Appeals) had reversed the initial classification and classified the scrap under Heading 40.04. The Revenue argued that the scrap was primarily purchased for metal recovery, emphasizing the metal content in the scrap. The Tribunal considered the arguments from both sides and examined relevant legal precedents. The Tribunal noted that earlier decisions and the Delhi High Court's ruling in a specific case were not brought to the attention of the Tribunal in a subsequent case. Following the precedent set by the Delhi High Court and the Tribunal's decision in a related case, the Tribunal ruled in favor of the appellant, holding that both the scrap rubberised steel belt fabrics and rubberised bead wires were not liable to excise duty. Consequently, the appeal filed by the assessee was allowed, while the appeal filed by the Revenue was rejected.

This comprehensive analysis of the legal judgment from the Appellate Tribunal CEGAT, New Delhi, highlights the classification issues surrounding scrap rubberised bead wires and rubberised steel belt fabrics, providing a detailed overview of the arguments presented by both parties and the Tribunal's final decision based on legal provisions and precedents.