2018 (4) TMI 222 - AT - Central Excise

Classification of goods - heavy commercial vehicles for the transport of goods and chassis of motor vehicles - Revenue held that they are not trucks designed for highway use, but were dumpers designed for off highway use. Such vehicles were classified, as per Revenue, under 870410 as well as chassis under 87060043. Held that - an identical issue has come up for consideration before the Tribunal in the assessee-Appellants own case M/s VE Commercial Vehicles Ltd., Nitin Nagda, M/s Man Trucks India Pvt. Limited M/s V.E. Commercial Vehicles Ltd. Versus CCE & ST, Indore 2018 (3) TMI 256 - CESTAT NEW DELHI , where it was held that such vehicles manufactured by the appellant are meant to carry loads and capable of off-loading but the same are not machines exclusively meant for off-road use. The motor vehicles manufactured by the appellants do not fall in the category of dumpers designed for off-highway use under 8704 10. They are classifiable, as claimed by the appellant under 8704 2390 as tipper trucks likewise the classification of chassis also will fall under 87060042 and not under 87060043 as claimed by the Department. Appeal allowed - decided in favor of assessee-appellant.

Summary

Issues:
Classification of motor vehicles and chassis for excise duty purposes.

Analysis:
The judgment involves appeals by the assessee-Appellants against an Order-in-Appeal passed by the Commissioner (Appeals-I) Customs, Central Excise & Service Tax, Bhopal, concerning the classification of heavy commercial vehicles and chassis attracting Central Excise duty. The Department contended that the vehicles and chassis were not designed for highway use but were "dumpers" for off-highway use, classified under specific headings. The dispute centered around the differential duty implications, particularly the National Calamity Contingent Duty (NCCD) leviable on chassis. Penalties were imposed, leading to the appeals by the assessee-Appellants.

The Tribunal considered the arguments presented by both sides and referred to a previous case involving similar issues. The Tribunal analyzed the characteristics of dumpers designed for off-highway use as per the HSN explanatory notes, emphasizing features like strong steel body, limited speed, special earthmoving tires, and specific construction details. Upon reviewing the technical specifications and catalog of the vehicles in question, the Tribunal concluded that the vehicles manufactured by the appellants did not align with the characteristics of dumpers exclusively meant for off-road use. The Tribunal also highlighted a clarification obtained from ARAI, Pune, emphasizing the importance of basic technical specifications in classification.

The Tribunal further addressed the reference to Cenvat Credit Rules in the adjudicating authority's decision, clarifying that classification under the Central Excise Tariff Act should not be based on such references. Relying on the HSN explanatory notes and tariff headings, the Tribunal determined that the motor vehicles should be classified as tipper trucks under specific headings, not as dumpers for off-highway use. Consequently, the differential duty demand, including NCCD, was set aside based on the analysis and findings from the previous case.

In line with the previous order and the detailed analysis provided, the Tribunal set aside the impugned order and allowed the appeals filed by the assessee-Appellants. The judgment highlighted the importance of technical specifications, HSN explanatory notes, and accurate classification for excise duty purposes, ultimately leading to the favorable outcome for the appellants in this case.