2015 (3) TMI 171 - AT - Central Excise

Waiver of pre deposit - Classification of goods - Classification of Backhoe under Chapter Heading 84322990 or under 84.31 - Held that - The picture of Backhoe given by the appellants conforms to the claims made on their website regarding its use. As per the appellants website, Backhoe can be very efficiently used in the excavation of soil, foundation for building, trenches for pipeline and cable laying, to handle garbage, widening of rural roads. Indeed in the website agricultural, horticultural or allied activities do not even find a mention in the list of areas where Backhoe can be efficiently used. Tariff heading (84.32) covers agricultural, horticultural or forestry machinery for soil preparation or cultivation; lawn or sports ground rollers On the other hand, we find that the order-in-original as well as the order-in-appeal have discussed as to why the impugned goods do not merit classification under Tariff heading 84.32. - this much is prima facie evident that impugned goods do not merit classification under 84.32 and hence are not eligible for the nil rate of duty. Accordingly, we are of the view that the appellants have not made out a case for waiver of pre-deposit - Partial stay granted.

Summary

Issues:
Classification of Backhoe under Chapter Heading 84322990 for Nil rate of duty vs. under 84.31 leading to demand confirmation.

Analysis:
The appellants filed a stay application along with their appeal against an order confirming a demand of &8377;1,84,721/- along with interest and equal mandatory penalty. The main issue revolves around the classification of the Backhoe, which the appellants argue should be classified under Chapter Heading 84322990 eligible for Nil rate of duty. However, the Commissioner (Appeals) upheld its classification under 84.31, resulting in the impugned demand. The appellants claim that the Backhoe, attached to a tractor, is primarily meant for agricultural and allied purposes, justifying its classification under Chapter Heading 84322990.

Upon examining the contentions of the appellants and reviewing a picture of the Backhoe provided, it was noted that the Backhoe's usage aligns with the claims made on the appellants' website. The website highlighted the Backhoe's efficiency in various activities such as excavation of soil, foundation work, handling garbage, and road widening, without specifically mentioning agricultural or horticultural applications. The Tariff heading 84.32 covers machinery for agricultural, horticultural, or forestry purposes, while the impugned goods were deemed unsuitable for classification under this heading in the original and appellate orders.

The tribunal refrained from definitively classifying the impugned goods at that stage. However, it was prima facie evident that the goods did not qualify for classification under 84.32 and thus were not eligible for the Nil rate of duty. Consequently, the appellants failed to establish a case for waiving the pre-deposit requirement. The tribunal ordered a pre-deposit of the impugned demand within four weeks, along with proportionate interest. Compliance was to be reported by a specified date, with a stay on penalty recovery during the appeal's pendency. Failure to comply would result in the dismissal of the appeal for lack of pre-deposit.