Customs, Excise and Gold Tribunal - Tamil Nadu
Cce vs Kali Steel And Engineering Industries ... on 10 June, 2005
Equivalent citations: 2005(187)ELT431(TRI-CHENNAI)
ORDER P.G. Chacko, Member (J)
1. These are appeals filed by the Revenue against an order of the Commissioner (Appeals). The respondents, during the material period, were engaged in the manufacture of Pressure Cookers of various capacities. In December, 1995, they filed a declaration under Rule 173B of the Central Excise Rules, 1944 classifying "Pressure Pan with Lid" and "Pressure Pan without Lid" under SH 7323.00 of the CETA schedule and claiming the benefit of 'nil' rate of duty in terms of S.No. 4 in the Table annexed to Notification No. 41/94-CE dated 01.03.1994. Accordingly, they cleared both the products without payment of duty during the periods Jan.-Apr.'96 and May to Aug.'96. The Department did not accept the assessees' claim for exemption under the above Notification and accordingly issued two show-cause notices to them demanding duty for the above periods. The original authority, in separate orders which were passed in adjudication of the two show-cause notices, classified "Pressure pan with Lid" as Pressure Cooker under SH 7323.00 and held that Central Excise Duty (CED) was leviable thereon at the rate of 10% ad valorem in terms of S.No. 11 in the Table annexed to Notification No. 41/94-CE ibid. "Pressure Pan without Lid" and "Lid without Pressure Pan" were classified as parts of Pressure Cooker under SH 7323.00 attracting duty at tariff rate (15% ad valorem), as the above Notification did not cover parts of Pressure Cooker. The assessee preferred appeals to the Commissioner (Appeals) and the latter granted partial relief. It was held by ld. Commissioner (Appeals) that "Pressure Pan with Lid" and "Pressure Pan without lid" were to be treated as kitchen articles covered by the description given at S.No. 4 in the Table annexed to the above Notification. The assessees' appeals were allowed to this extent. As regards "Lid without Pressure Pan", the order of the original authority was upheld. This part of the decision of the Commissioner (Appeals) is not under challenge before us. In the present appeals, the Revenue is aggrieved by the decision of the lower appellate authority with regard to "Pressure Pan with Lid" and "Pressure Pan without Lid".
2. We have examined the records, inspected samples of Pressure Pan and Lid produced by the respondents and heard both sides. Ld. SDR has argued that "Pressure Pan with Lid" has to be treated on par with Pressure Cooker, as it cooks food under pressure. In other words, it works on the principle employed in Pressure Cooker. On the other hand, Ld. Counsel for the respondents has argued that the item cannot be classified by functional test. Its classification should be determined by Commercial Identity Test. Ld. Counsel has claimed that a "Pressure Pan with Lid" is not known as Pressure Cooker in commercial parlance. In this connection, he has relied on the Supreme Court's judgement in G.S. Auto International Ltd. v. Commissioner of Central Excise, Chandigarh . As regards "Pressure Pan without Lid", it has been pointed out by ld. SDR that the top portion of the Pressure Pan has a provision for interlocking so that it could be closed with the lid along with gasket and can be used as Pressure Cooker. On this basis, it has been submitted that "Pressure Pan without Lid" requires to be treated as a part of Pressure Cooker. This argument has also been opposed by ld. Counsel on the basis of commercial parlance.
3. Upon inspection of the samples of Pressure Pan and Lid, we have found that, as rightly pointed out by ld. SDR, the edges of the pan and the lid are so designed as to provide for interlocking so that the Pan, closed with the Lid along with gasket, would work as a Pressure Cooker. After inspecting these parts and assembling them into a composite article, anyone in the trade would treat it only as a Pressure Cooker. Hence, going by the Trade Parlance Test laid down by the apex court in the case of G.S. Auto International (Supra) and relied on by ld. Counsel, we have to classify the "Pressure Pan with Lid" as a Pressure Cooker. By the same logic, "Pressure Pan without Lid" can be treated only as a part of Pressure Cooker. Pressure Cooker and parts thereof were kept out of the purview of kitchen articles under S.No. 4 of the Table annexed to Notification No. 41/94-CE as amended by Notification No. 66/94-CE dated 09.03.1994. Hence the benefit of 'nil' rate of duty in terms of S.No. 4 ibid is not available to "Pressure Pan with Lid" and "Pressure pan without Lid".
4. In the result, the Revenue's appeals succeed and the same are allowed.