TaxTMI 
TaxTMI 
2024 (5) TMI 1334
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....anufactured by the party and supplied to their OEMs/Job Workers are classifiable under sub-heading No.8528.00 of CETA, (2) I confirm the demand of Central Excise duty amounting to Rs.1,41,02,716/- (Rs. One Crore Forty One Lakhs Two Thousand Seven Hundred Sixteen only) under Section 11A of the Central Excise Act, 1944. (3) I confirm the demand of interest on the above said amount under Section 11AB (Now Section 11AA) of the Central Excise Act, 1944. (4) I impose a penalty of Rs.1,41,02,716/- (Rs. One Crore Forty One Lakhs Two Thousand Seven Hundred Sixteen only) on the party under Section 11AC of the Central Excise Act, 1944 read with Rule 25 of the Central Excise Rules, 2002." Hence the present appeal before the Tribunal. 2. Brief facts of the case are that the Appellant was engaged in the manufacture of Colour Television Sets CTVs and their parts and sub-assemblies in their factory. The CTVs were being cleared on payment of Excise Duty by classifying the same under Heading 85.28 of the Central Excise Tariff Act. During the relevant period, the CTVs were also subject to Maximum Retail Price MRP based assessment in terms of Section 4A of Central Excise Act, 1944 and acco....
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....peal No.E/2050/2008 filed before the Tribunal. The Tribunal vide Final Order No.A/57508-57530/2013-EX(DB) dated 07.08.2013 remanded the matter to the Adjudicating Authority for fresh decision in the light of the declaration of the law by Hon'ble Supreme Court in Salora International Ltd. vs. CCE 2012 (284) E.L.T. 3 (S.C.). The impugned order has been passed dated 13.11.2015 pursuant to the remand order. Hence the present appeal before the Tribunal. 3. Heard both sides and perused the appeal records. 4. We find that the issue is no more res integra and is squarely covered by the decision of the Tribunal in the case of M/s L. G. Electronics India Pvt. Ltd. vs. CCE, Noida-II. In the above matter the Tribunal has decided that the parts and Sub-assembling cleared without all the critical components cannot be classified as CTVs. The Tribunal further held that unless all the critical parts of CTVs i.e. CTPs and PCBs also, are removed together, till then Rule 1 of the Rules of Interpretation to the Tariff is applicable and Rule 2(a) of the same Rule has no application and accordingly, the classification of such parts/Sub-assemblies will fall under 85.29 of the Tariff. The Tribunal set as....
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....te article are presented together for assessment at the same point of time, rule 2(a) cannot be invoked to classify the parts as complete article. It has also been held that consignments removed/presented at different points of time from different factories cannot be clubbed together to classify the parts as complete article. 18. A Larger Bench of the Tribunal in Sony India examined rule 2(a) of the Customs Tariff and held that rule 2(a) has to be applied while considering the relevant Tariff Entry for each item and the observations are : "16. We thus come to the core dispute in this appeal whether the different parts imported under 94 Bs/E spread over the period from April, 1995 to January, 1997 can be combined together for the purpose of assessment by applying Rule 2(a), of the Interpretative Rules. Going by the language of Rule 2(a) the question whether parts or components are to be treated as article complete or finished, has to be considered at the time when they are presented unassembled or disassembled. There is no case for the Revenue in these proceedings that at some point of time before the import the goods were in the form of CTV sets and thereafter they were disas....
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....a process. It was contended that such goods could be subjected to duty only in the State in which they were imported. It was held that the countervailing duty must be levied on goods in the State in which they are when they are imported. This was on the basis of Section 3 of the Customs Tariff Act. Though there is no reference to Rule 2(a), in our opinion, the same Rule should apply subject ofcourse to the applicability of the Rule. We have already held that the Rule is not applicable. Similar view was taken in Dunlop India and Madras Rubber Factory Ltd. v. UOI [1983 (13) E.L.T. 1566 (S.C.). 12. Shri Lakshmikumaran argues on the basis of a German Court decision on which the Tribunal also relied upon. According to the learned counsel in that decision Rule 2(a) was considered and the Court took the view that the article is to be considered to be imported in unassembled or disassembled where the component parts, that is the parts which may be identified as components intended to make up the finished product are all presented for customs clearance at the same time. The interpretation that we have given to Rule 2(a) would mean that Rule 2(a) would be applicable only and only if all th....
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....ant section and chapter notes, the classification cannot be altered by taking recourse to the Interpretative Rules. 23. In this connection, it would be pertain to refer to the observations made by the Supreme Court in Simplex Co. Ltd. and they are reproduced below : "11. The rules for the interpretation of the Schedule to the Central Excise Tariff Act, 1985 have been framed pursuant to the powers under Section 2 of that Act. According to Rule 1 titles of Sections and Chapters in the Schedule are provided for ease of reference only. But for legal purposes, classification "shall be determined according to the terms of the headings and any relevant section or Chapter Notes". If neither the heading nor the notes suffice to clarify the scope of a heading, then it must be construed according to the other following provisions contained in the Rules. Rule-l gives primacy to the Section and Chapter Notes along with terms of the headings. They should be first applied. If no clear picture emerges then only can one resort to the subsequent rules." 24. In Salora International, the Supreme Court also clarified the legal position as follows: "18. The main question that arises for cons....
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...., parts of machines (not being parts of the articles of heading 84.84, 85.44, 85.45, 85.46 or 85.47) are to be classified according to the following rules : (a) parts which are goods included in any of the headings of Chapter 84 or 85 (other than headings 84.85 and 85.48) are in all cases to be classified in their respective headings; (b) ..................... 22. As can be seen from the above, the clear stipulation contained in Section Note 2 is to the effect that "parts" of goods mentioned in the Chapters specified therein, shall in all cases be classified in their respective heading. In that light, the fundamental enquiry in this case must be that of whether the goods produced by the appellant may be said to be covered by the above Section Note. 23. In view of the above mentioned Section Note, the question that arises here is whether the goods produced by the appellant can be described as "parts" under the goods included in any of the headings of Chapter 84 or 85. In this respect, it is the contention of the appellant that the goods produced by them shall inevitably have to be considered as "parts", as they are unable to receive a picture, which is said to be a fundam....