2002 (4) TMI 386 - AT - Central Excise

Tribunal remands case for new duty determination, considers classification & notifications

The Tribunal partially allowed the appeals, remanding the case for a de novo determination of duty by the Divisional officer, considering the ... Classifiaction - Rockwool in article form Issues Involved:1. Classification of Rockwool products under the Central Excise Tariff Act, 1985.2. Applicability of specific vs. residual headings for classification.3. Interpretation of trade parlance and common parlance in classification.4. Application of relevant case laws and circulars.5. Determination of duty demands and applicability of exemption notifications.Issue-wise Detailed Analysis:1. Classification of Rockwool Products:The Deputy Commissioner classified Rockwool products under Chapter sub-heading 6803.00, considering it a specific heading for Rockwool. The Commissioner (Appeals) overturned this, stating that goods with more than 25% by weight of red mud, press mud, or blast furnace slag fall under Heading 6807, which is more specific in this context.2. Specific vs. Residual Headings:The Deputy Commissioner argued that Heading 6803 is specific for Rockwool, while Heading 6807 is residual. The Commissioner (Appeals) disagreed, explaining that Heading 6807 is not merely residual but specifically covers goods with significant content of certain materials, thus making Heading 6803 inapplicable.3. Trade Parlance and Common Parlance:The Revenue contended that Rockwool products, known and marketed as such, should be classified under Heading 6803.00, aligning with Rule 3(a) of the Rules for Interpretation of the Excise Tariff Schedule. They cited several Supreme Court judgments emphasizing classification based on trade and common parlance.4. Relevant Case Laws and Circulars:The Revenue referenced Supreme Court decisions (Metagrapher Pvt. Ltd., Fuse Base Eltoto Ltd., and Tata Oil Mills Company Ltd.) and CBEC Circular No. 587/24/2001-CX., dated 17-9-2001, supporting their classification under 6803.00. However, the Tribunal found that these references did not aid the Revenue's case due to the specific coverage of Headings 6803 and 6807.10.5. Duty Demands and Exemption Notifications:The Tribunal determined that Rockwool in its pristine form (Cover wool and Loose wool) falls under 6803, while articles made from Rockwool (e.g., mats, slabs, pipes) fall under 6807.10. Goods classified under 6803 are covered by exemption Notification No. 8/96-C.E., while those under 6807.10 are subject to Notifications 5/97-C.E. and 5/98-C.E. The duty demands must be recalculated accordingly.Conclusion:The Tribunal partially allowed the appeals, remanding the case for a de novo determination of duty by the Divisional officer, considering the classification distinctions and applicable notifications. The Miscellaneous petitions were also disposed of.