Customs, Excise and Gold Tribunal - Mumbai
Commissioner Of C. Ex. And Cus. vs Kamal Castings on 26 September, 2000
Equivalent citations: 2001(127)ELT208(TRI-MUMBAI)
ORDER S.S. Sekhon, Member (T)
1. These two appeals have been filed by the Revenue against the order of the Commissioner (Appeals), Pune.
2. The learned Commissioner (Appeals) relying upon the HSN Explanatory Notes under Chapter 73 that forging, stamping and other processes of removal of burrs, run outs etc. would not bring the operations under the mischief of 'further worked upon' of castings, mouldings, stamping or forging for products of Chapter 7419.91 to merit their classification under Chapter 7419.99 when such processes are carried out as per the request of the customers.
3. The grounds taken in the appeal are :
(a) that the Commissioner (Appeals) has erred in holding that the product for example rings, bushes, and parts of machinery made out of copper would be classifiable under chapter heading 7419.91 and would be eligible for Notification 178/88 as he has not appreciated that the assessees have carried out various operations after casting of copper and copper alloys manufactured by them and that the Tariff Heading 7419.91 covers moulded, stamped or forged articles of copper which are not further worked, and after such further working such castings etc. would fall under heading 7419.99.
(b) Even if Notes to sub-heading 7326.11 and 7326.19 of HSN applies, it is difficult to see how the 'proof machining operations' including bevelling and cutting etc. can be permitted for classification of the product under sub-heading 7419.91.
(c) The plea of the manufacturers that champering is nothing but blunting sharp edges for the safety of the operating doing further machining etc. is questionable even if it is proved that it is an operation which is not permitted. It is a machining operation not linked with detection of flaws in the metal and is not covered by specified operation under the HSN heading 7419.99 and not under heading 7419.91.
4. We have heard the departmental representative for the department, who has reiterated the grounds taken in the appeal and on a question from the Bench, whether they had any material evidence to bring on record that further working alleged to be done on the casting, forging and stampings resulted in a commercially different new product to emerge; he submitted, fairly, that they have no such material with them. The respondents are absent. We proceed to decide the matter and after considering the material, we find that to cover a change in classification within sub-heading or to consider the exigibility under the same sub-heading the emergence of a commercially identifiable new product is sine qua non the Supreme Court in the case of Laminated Packagings (Pvt) Ltd. v. CCE -1990 (46) E.L.T. 326 (S.C.) has held :
"The further contention urged on behalf of the appellant that the goods belong to the same entry is also not relevant because even if the goods belong to the same entry, the goods are different identifiable goods, known as such in the market. If that is so, the manufacture occurs and if manufacture takes place, it is dutiable. 'Manufacture' is bringing into being goods as known in the excise laws, that is to say, known in the market having distinct, separate and identifiable function. On this score, in our opinion, there is sufficient evidence. If that is the position, then the appellant was liable to pay duty. We are, therefore, clearly of the opinion that the order of the CEGAT impugned in this appeal does not contain any error. The appeal, therefore, fails and is accordingly dismissed."
5. In this view of the matter, when we find that the revenue has no material to submit regarding the emergence of a different identifiable new product known in the market, then we cannot accept the need for change in classification of the entity to take place by the use of the alleged 'further working' in the facts of this case "further working" should result in a different identifiable goods, known in the market to emerge, if it does not, then such working will not be 'further working' under the Central Excise Act to attract exigibility.
6. In view of our findings, the appeals are rejected.