1995(05)LCX0141

IN THE CEGAT, SPECIAL BENCH `D’, NEW DELHI

S/Shri K.S. Venkataramani, Member (T), K. Sankararaman, Member (T) and G.A. Brahma Deva, Member (J)

COLLECTOR OF CENTRAL EXCISE, BOMBAY

Versus

SEJISHA IMPORTS & EXPORTS

Order No. 155/95-D, dated 2-5-1995 in Appeal No. C/1096/93-D

Advocated By : Shri Mohan Lal, JDR, for the Appellant.

None, for the Respondents.

[Order per : K.S. Venkataramani, Member (T)]. - This appeal is directed against the order dated 14-9-1993 passed by the Collector of Customs (Appeals), Bombay. The facts in brief are that the respondents herein imported a consignment describing in the Bill of Entry as Magnetic Buttons (leather goods) during 1992 at the Bombay Custom House. The goods were classified under Heading 9606.22 CTA extending exemption under the Notification No. 267/89. This heading of 9606.22 reads as buttons, press-fasteners, snap-fasteners and press-studs, button moulds and other parts of these articles; button blanks. The sub-heading 9606.22 covers such articles of base metals not covered with textile material. Subsequently to the clearance of the goods it appeared to the Custom House that the goods were correctly classifiable under sub-heading 8309.90. Heading 8309.00 at the relevant time covered Clasps, frames with clasps, buckles, buckle clasps, hooks, eye, eyelets. Therefore, less charge demand was issued for Rs. 7,542/- on the revised classification at the higher rate of duty. The respondents’ claim, before Assistant Collector of Customs was that magnetic buttons were specifically covered by Heading 96.06 and it was excluded from Chapter 83 because of Section Note 1(m) of Section XVI of the Tariff according to which buttons are excluded from Chapter 83. The Assistant Collector however, held that the HSN Explanatory Notes indicate that Heading 96.06 covers goods which are used in the garments and not with leather goods like ladies hand bags. He found, on the other hand, Heading 83.08 and the related HSN Explanatory Notes under that heading that the goods imported which the Assistant Collector found, are neither buttons nor fasteners of the types covers under Heading 9606 and are accordingly more correctly classifiable under Heading 8308. He confirmed the short levy demand. The Collector (Appeals) however, allowed the respondents’ appeal against the Assistant Collector’s order. He was of the view that it is incorrect to hold that Heading 96.06 is only for ready-made garments. He observed that in HSN Explanatory Notes at page 1605 buttons meant for footwear are also covered under that heading and so he felt it cannot be argued that Chapter 96 covers only buttons for ready-made garments. The Collector (Appeals) also perused the literature for the goods wherein they have been described as magnetic buttons. The catalogue also names it as button. Since buttons as such are covered at Chapter 96, the Collector held that it will be more appropriate to classify the imported goods under Heading 9606.00. It is against this order of the Collector (Appeals) that the present appeal has been filed by the Collector of Customs, Bombay. Shri Mohan Lal, the learned Departmental Representative referred to the ground of appeal and submitted that Heading 8308.00 CTA is more specific to the goods imported than Heading 96.06. Referring to the HSN Explanatory Notes under Heading 9606.00, the learned Departmental Representative contended that the buttons covered under that heading are those used in garments and in haberdashery. The goods imported are for use in leather goods and not in textile garments. The learned Departmental Representative, therefore, pleaded for the restoration of the Assistant Collector’s order. None was present for the respondents who have sent written submissions dated 14-3-1995 wherein they have more or less reiterated their earlier contention before the Collector (Appeals) and the Assistant Collector. They have referred to the catalogue mentioning their goods as magnetic buttons, the Department cannot validly contend that they are otherwise. They have also pleaded that the Department has not established with evidence that it is a misnomer to call the goods as magnetic buttons especially in the face of the manufacturer’s catalogue describing the goods as buttons.

2. We have carefully considered the submissions made by both the parties. The coverage of the rival entries 8308 and 96.06 have been referred to above. It is seen that the respondents have produced the manufacturers’ catalogue. The catalogue described the goods as magnetic buttons for hand bags, pouches and others. The respondents have also stated in their written submissions that the goods are admittedly used in leather bags. This being so, it will be useful to turn to Explanatory Notes to HSN under Heading 83.08 according to which this heading inter alia covers clasps, fasteners and frames with clasps, for handbags, purses, brief-cases, executive-cases or other travel goods, or for books or wrist-watches; but the heading excludes locks (including locking clasps), and frames with clasps, incorporating locks. The function of the goods when fixed to the leather bags is only as clasps. In such a situation, the Assistant Collector’s finding in the light of the HSN Explanatory Notes that the goods fall for classification more appropriately under Heading 83.08 has a lot of force and has to be accepted. As for the contention which found acceptance with the Collector (Appeals) that Heading 96.06 also covers buttons for footwears etc., the perusal of the HSN Explanatory Notes under that heading shows that this observation occurs in respect of what has described as pierced and shank buttons and it has stated that these may be of various sizes and shapes according to the purpose for which they are to be used (underwear, outer garments, footwear etc.). Therefore to fall within this category, it will have to be established by evidence that what has been imported is of the category of Pierced and shank buttons. There is no such evidence brought on record. In such a view of the matter, we are inclined to hold that the magnetic buttons imported by the respondents herein would be more appropriately classifiable under Heading 83.08 and not under Heading 96.06 CTA. In this view of the matter, the impugned order is set aside and the Department’s appeal is allowed.

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Equivalent 1995 (78) ELT 488 (Tribunal)