1996(02)LCX0088
BEFORE THE COMMISSIONER OF CENTRAL EXCISE (APPEALS), MADRAS
Shri T.R. Radhakrishnan
IN RE : TITANIUM TANTALUM PRODUCTS PVT. LTD.
Order-in-Appeal No. 50/96(M), dated 27-2-1996
Cases Quoted
H.M. Baga v. Collector — 1994(10)LCX0032 Eq 1995 (075) ELT 0171 (Tribunal) [Para 3]
Ballarpur Industries Ltd. v. Assistant Collector — 1995(01)LCX0139 Eq 1995 (076) ELT 0499 (S.C.) [Para 3]
Advocated By : Shri T. Francis Nelson, Vice President (F), for the Appellant.
[Order]. - The appellant are aggrieved by the impugned order of the lower authority reclassifying certain products manufactured by them and demanding consequential differential duty.
2. In the proceedings before lower authority the dispute related to correct classification in respect of anodes, cathodes tubewell, theremowell, electrodes, electrolyser and anodes of base metals either under Chapter 8479 or under 8108, 8103 and 8109 of Central Excise Tariff Act, 1985. The lower authority concluded that anodes, cathodes and anode baskets are reclassifiable under Chapter Heading 8108 and the rest under Chapter Heading 8479 of Central Excise Tariff Act, 1985.
2.1 Challenging the impugned order, the appellants contend :-
(i) that there were no circumstances justifying reopening of approved CL.
(ii) that it is highly impractical and illogical to classify material on the basis of constituent material only.
(iii) that their arguments regarding factors necessary to modify the approved CL were not considered.
(iv) that an appliance used along with process equipments must be classified only under Chapter 84.
(v) that anode baskets are fabricated out of Titanium mesh sheets and rods and that constituent material is 100% Titanium, that it is not an item of general use but has to be used in electroplating process by holding the plating material, that anode basket cannot be used like any other basket and that it is not proper to classify the same as an article of base metal.
(vi) that once it is accepted that electrolyser falls under Ch. 84.79, its parts anodes & cathodes should also be classified therein in terms of Section Note 2(b) of Section 16, that this holds good for anode baskets also.
(vii) that non-quantification of duty liability was bad in law.
(viii) that lower authority has no power to make a demand for more than Rs. 50000/-.
2.2 The appellants were represented by Shri T. Francis Nelson, Vice President during the hearing on 24-1-1996. He claimed classification as part of machinery of general use as laid down in HSN Chapter Note (page 13.15) where vats or tanks have been included as falling under Chapter Heading 84.89. It was also claimed that the note under Chapter Heading 81.08 indicating titanium anode as falling under that item would apply only to cast titanium which is 100% pure titanium and not to their products, which have a coating of precious metal chemicals, besides a copper rod being inserted into the titanium anode.
3. I have carefully considered the materials on record and issues raised in appeal. As regards re-opening of approved classification list, the action of the lower authority is justified in terms of Section 11A duly supported by the decision of Tribunal in the case of H.M. Baga v. CCE, Delhi reported in 1994(10)LCX0032 Eq 1995 (075) ELT 0171 (Tribunal) as also the decision of Supreme Court in the case of Ballarpur Industries Ltd. v. Assistant Collector of Central Excise reported in 1995(01)LCX0139 Eq 1995 (076) ELT 0499 (SC). I had the occasion to analyse the correct classification in respect of similarly placed products in my Order-in-Appeal No. 169/95(M) dated 3-8-1995 in the appeal filed by M/s. Titanium Equipments and Anode Manufacturing Co. Ltd., Vandulur, and I have reasoned as follows :
HSN Notes at P. 1095 dealing with Chapter 81.08 indicate that Titanium is principally used in aircraft, ship building, for making vats, agitators, heat exchanger, valves and pumps for the chemical industry for the desalination of sea water and for construction of nuclear power stations. It further states that this heading covers Titanium in all forms in particular spange, ingots, power, anodes, bars and rods, sheets and plates; waste and scrap and products other than those articles covered by other chapter of nomenclature.
Applying the HSN Notes of the Ch. 81.08 it is clear that items like anodes, cathodes would straightaway merit classification under this heading as articles of Titanium.
Following the ratio of my earlier decision, the classification of anodes, cathodes under 8108 of Central Excise Tariff Act, 1985 by lower authority has to be upheld. The appellant had contended that Chapter Heading 81.08 would apply only to Cast Titanium which is 100% pure titanium and not to their products, which have a coating of precious metal chemicals. I find from Notes of Chapter 81 that they cover base metals, their alloys and articles there of, which are not specifically covered elsewhere in the nomenclature. It is also stated that the metals classified in this chapter are mainly used in the form of alloys or carbides rather than in the pure state. Hence, the appellant’s contention in this regard cannot be accepted.
4. As regards Anode Basket the order of lower authority would state that the constituent material is 100% Titanium, that it is used to hold the plating material in an electroplating process. In terms of HSN Notes as baove, this product would appropriately merit classification under Chapter 8108 of Central Excise Tariff Act, 1985.
5. The appellants have also contended that once it is accepted that electrolyser falls under Chapter 84.79 its parts anodes and cathodes should also be classified therein in terms of Section Note 2(b) of Section 16 and this holds good for anode baskets also. The classification of electrolyser under Chapter 84.79 or otherwise is not an issue before me in this appeal and as such the merits of its classification under Chapter 84.79 cannot be commented upon and discussed.
6. One more contention of the appellant is that non-quantification of duty liability was bad in law. I find that the classification dispute covered a variety of items out of which in the impugned order the lower authority has revised the classification only in respect of three products. As such the exercise of quantification has to be made only subsequent to the decision. Hence I do not find anything wrong in non-quantification of demand by lower authority.
7. In the circumstances above the impugned order is upheld and appeal is rejected.
Equivalent 1996 (087) ELT 0776 (Commr. Appl.)