Interim excise duty classification for UPS systems ordered pending final determination, with undertaking to follow the eventual ruling.

Pending final resolution of the tariff classification dispute for Uninterrupted Power Supply systems, the court directed an interim arrangement under which excise duty would continue to be paid treating the product as classifiable under Heading 85.04. The direction was made in light of the ongoing consideration of the classification issue before the Supreme Court and reconsideration by the CEGAT, together with the existing departmental circular and competing classification view. The petitioner was also required to furnish an undertaking to abide by the ultimate decision when rendered, so that duty compliance would remain aligned with the final classification outcome.

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Issues: Whether, pending the final decision on the tariff classification of Uninterrupted Power Supply System, the petitioner should be directed to pay excise duty treating the product as falling under Heading 85.04 and furnish an undertaking to abide by the ultimate decision.

Analysis: The classification dispute was already under consideration before the Supreme Court and was also linked to reconsideration by the CEGAT. In the meantime, the existing departmental circular and the then prevailing position on classification were noted, along with the competing view expressed in the impugned circular. In these circumstances, an interim arrangement was considered appropriate so that duty liability would continue to be discharged on the basis of Heading 85.04, coupled with an undertaking to comply with the final decision when rendered.

Conclusion: The petitioner was directed to pay excise duty treating UPS as classifiable under Heading 85.04 until further orders and to file the requisite undertaking to abide by the final decision.

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