2001 (8) TMI 605 - AT - Central Excise

Summary

Issues: Duty liability on untrimmed sheets and circles of copper under Central Excise Tariff.

Comprehensive Analysis:

1. Duty Liability on Untrimmed Sheets and Circles of Copper:
- The appeal pertained to the duty liability on untrimmed sheets and circles of copper under heading 7409 of the Central Excise Tariff. The Commissioner Central Excise (Appeals) had upheld the duty of Rs. 2,000/- per tonne on untrimmed sheets or circles under Notification No. 135/94-C.E., dated 27-10-1994.

2. Manufacture and Classification Issues:
- The appellants purchased copper scrap from outside without taking Modvat credit. They manufactured untrimmed circles, later trimmed for use in utensils or handicrafts, eligible for exemption under Notification No. 42/94-C.E., dated 1-3-1994. The argument was that both untrimmed and trimmed circles were classifiable under heading No. 7409, hence no duty was chargeable on untrimmed circles used in manufacturing exempted trimmed circles.

3. Interpretation of Notifications:
- Notification No. 42/94-C.E., dated 1-3-1994 exempted goods, excluding untrimmed sheets or circles of copper, for use in utensils or handicrafts. Untrimmed sheets or circles were covered under Notification No. 135/94-C.E., dated 27-10-1994, with a concessional duty of Rs. 2000/- per tonne if intended for handicraft or utensil manufacture without taking duty credit on inputs. The untrimmed circles were used to obtain trimmed circles, not for handicrafts or utensils, as per the classification list.

4. Different Duty Rates and Case Law:
- Untrimmed sheets attracted a lower duty rate than trimmed sheets, indicating separate classification. A recent Supreme Court decision confirmed that converting hank yarn to cone yarn within the same factory attracted differential excise duty, as the exemption to hank yarn aimed to assist handlooms, not powerlooms using cone yarn. Previous case laws cited were deemed irrelevant to the current appeal's specific product and circumstances.

5. Judgment and Conclusion:
- Considering the language of the notifications, facts, and duty tabulation, the Tribunal rejected the appeal. The Tribunal emphasized that the applicable Notification was No. 135/94-C.E., dated 27-10-1994, and upheld the lower authorities' correct view. The appeal lacked merit based on the established legal principles and was consequently dismissed.