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of <h1>Tribunal remands demand confirmation for redetermination based on clearance segregation under specific headings.</h1> <h3>STO-RACKS LTD. Versus COMMISSIONER OF C. EX., BANGALORE</h3> STO-RACKS LTD. Versus COMMISSIONER OF C. EX., BANGALORE - 2001 (129) E.L.T. 337 (Tri. - Bang.) Issues Involved:1. Classification of the product 'Mobile Storage System and Components' under the Central Excise Tariff.2. Determination of the correct tariff heading for the product: Heading 7308.90 vs. Heading 9403.00.3. Evaluation of the product's characteristics to determine its classification as furniture or a steel structure.4. Reassessment of duty demands based on the correct classification.Detailed Analysis:1. Classification of the Product:The primary issue revolves around the classification of the 'Mobile Storage System and Components' under the Central Excise Tariff. The appellants sought classification under Heading 7308.90, which pertains to structures and parts of structures of iron or steel. Conversely, the lower authorities classified the product under Heading 9403.00, which pertains to furniture and parts thereof.2. Determination of the Correct Tariff Heading:The appellants filed a classification list effective from 1/4/91, claiming classification under Heading 7308.90. This classification was initially approved by the Assistant Collector but was later overturned by the Collector (Appeals), who reclassified the product under Heading 9403.00. The product consists of a fixed block and several mobile blocks that can be moved on a rail track, with each block provided with an 'aisle lock' and a 'floor lock' for security and stability.3. Evaluation of Product Characteristics:The Tribunal examined the characteristics and functionalities of the mobile storage system, noting that it is used for efficient storage of various items such as spares, hardware, office records, etc. The system is tailored to different commercial uses based on the weight and type of items to be stored. The Tribunal considered the arguments and case laws presented by both parties.The Collector (Appeals) referenced Chapter Note 2 under Chapter 94, which states that items designed for placing on the floor or ground are classified under Headings 94.01 to 94.03, even if they are fixed to the wall or floor. The Tribunal found that the mobility criterion is not relevant for classification under Chapter 94. The product's use in various industries and offices aligns it more with furniture than with steel structures.4. Reassessment of Duty Demands:The Tribunal considered the case laws cited, including the Sh. Vindhya Paper Mills Ltd. case, which classified racks as furniture under Heading 9403.00, and the S.A.E (India) Ltd. case, which did not classify specific steel racks under 9403.00. The Tribunal concluded that the classification should be based on the end use of the product. If the product is used in places like workshops, storehouses, etc., it should be classified under Heading 7308. If used in offices, hospitals, etc., it should be classified under Heading 9403.The Tribunal held that the classification under 9403 should be determined based on the customer's end use, as indicated in the 'USER DATA (TO BE FURNISHED BY CLIENTS)' obtained by the appellants. If the design and end use conform to Heading 7308, the product should be classified accordingly.Conclusion:The Tribunal set aside the confirmation of the demand and remanded the matter for redetermination of the demands based on the segregation of clearances under Headings 7308 and 9403. The appellants are required to provide all necessary documents to the original authority for this purpose. The two appeals were disposed of in these terms.
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