2000 (3) TMI 505 - AT - Central Excise

Summary

Issues: Classification of goods under Central Excise Tariff Act, applicability of Notification Nos. 175/86 and 111/86, imposition of duty, penalty, and confiscation of goods.

In the judgment by the Appellate Tribunal CEGAT, New Delhi, the case involved three appeals arising from a common order passed by the Collector, Central Excise. The central issue revolved around the classification of goods under the Central Excise Tariff Act and the applicability of Notification Nos. 175/86 and 111/86. The Collector had demanded Central Excise duty, imposed penalties, and confiscated goods based on the classification of the goods under Heading 87.04 of the schedule to the Central Excise Tariff Act. It was contended that the impugned product was a works truck and should be classified under Heading 84.27 of the Tariff. The appellant argued that they were not licensed to manufacture motor vehicles and that the works trucks they produced were distinct from dumpers. The Collector, however, concluded that the impugned product functioned as a dumper based on its characteristics and usage in construction sites and mines.

Regarding the classification dispute, the Appellate Tribunal upheld the Collector's findings, citing statements from individuals involved in the manufacturing process and the function performed by the goods. The Tribunal referred to the Explanatory Notes of the H.S.N. which included dumpers under Heading 87.04, supporting the Collector's classification decision. Additionally, the Tribunal emphasized the importance of resolving tariff classification disputes with reference to the internationally accepted nomenclature found in the H.S.N. unless there is an express different intention indicated by the Tariff Act.

In terms of the applicability of Notification No. 175/86, the Tribunal upheld the denial of benefits under the notification as Heading 87.04 was excluded from its purview. The duty demanded by the Collector was upheld, but the penalties imposed were reduced based on the facts and circumstances of the case. The penalties on M/s. Kay Kay Engineers, M/s. Susumo Engineering, and individuals associated with the case were reduced from the original amounts.

In conclusion, the appeal was disposed of with the Tribunal affirming the duty imposition while reducing the penalties imposed by the Collector. The judgment highlighted the importance of proper tariff classification based on international standards and the specific provisions of relevant notifications under the Central Excise Tariff Act.