1988 (5) TMI 286 - AT - Central Excise

Classification of nuts & screws under Central Excise Tariff upheld, emphasizing product nature over market use.

The Tribunal upheld the classification of nuts and screws under Item 52 of the Central Excise Tariff, rejecting the firm's argument that they should be ... Classification Issues: Classification of nuts and screws under Central Excise Tariff - Assessment under Item 52In this case, the issue revolved around the classification of nuts and screws manufactured by M/s. Gramophone Company of India under the Central Excise Tariff. The Government of India issued a show cause notice under Section 36(2) of the Central Excises and Salt Act, 1944, challenging the order-in-appeal passed by the Collector of Central Excise, Calcutta. The firm argued that the nuts and screws, although having threads, were not classifiable under Item 33AA but should be classified under Item 68. They contended that these nuts and screws were designed specifically for fastening within the radiogram chassis and should be considered parts of the radiogram, not falling under Item 52 as claimed by the department.The firm maintained that the nuts and screws they produced were not capable of being sold in the market and were exclusively used for the manufacture of radiograms. They argued that the mere presence of threads did not automatically categorize them as nuts or screws if they were recognizable as component parts of an instrument or appliance. The department, however, asserted that these items were indeed nuts and bolts falling under Item 52 of the Central Excise Tariff. The department's counsel argued that the nuts and screws, even when used as components in radiograms, retained their identity as nuts and bolts and should be assessed accordingly.The Tribunal analyzed the arguments presented by both parties and examined the correct interpretation of the Central Excise Tariff. The Tribunal noted that the order-in-appeal seemed to misconstrue the concept of complementary items for assessment, emphasizing that a bolt or nut did not need to have its corresponding counterpart for assessment under Item 52. The Tribunal clarified that if a commodity met the description of a bolt or nut, it should be assessed accordingly, irrespective of its recognition in the trade. The Tribunal emphasized that the assessment under the Central Excise Act was based on the nature of the product and its classification under the tariff, rather than its market recognition or usage.Ultimately, the Tribunal agreed with the Assistant Collector's assessment of classifying the nuts and screws under Item 52 of the Central Excise Tariff. The Tribunal held that the nuts and screws, designed for fastening within the radiogram chassis, should be assessed as nuts and bolts under Item 52, affirming the correctness of the assessment made by the Assistant Collector.