Workwell Engg. Co v. Collector of Central Excise, Vadodara , (SC) BS195815
SUPREME COURT OF INDIA

Before:- Ruma Pal, Arijit Pasayat and C. K. Thakker, JJ.

Civil Appeal No. 96 of 2000. D/d. 20.4.2005.

With

Civil Appeal No. 7598 of 1999.

Workwell Engg. Co. - Appellant

Versus

Collector of Central Excise, Vadodara - Respondent

A. Central Excise Tariff Act, 1985 - Heading 85.09 or 84.37 - Goods/ Articles - Electric flour mill - Classification of - CEGAT held flour mill to be classifiable under Heading 85.09 on the basis of its decision in an earlier case of the assessee itself which was affirmed by Supreme Court - However, subsequently domestic flour mill was declared to be classifiable under Heading 84.37 vide a circular issued by CBEC - Held - Advent of circular after the earlier decision was rendered was relevant factor which should have been considered by the Tribunal untrammeled by earlier decision rendered by the Tribunal - Thus matter remanded to the Department pursuant to setting aside of the CEGAT order in the instant case, to decide the question of classification on the basis of relevant material produced by the parties.

[Paras 2 and 5]

B. Central Excise Act, 1944, Section 35L(b) and 37-B - Res judicata - CEGAT's decision on classification of certain goods dismissed by Supreme Court vide a non-speaking order - Subsequently a different opinion expressed by CBEC from that expressed by CEGAT - In a subsequent case CEGAT followed its earlier decision without adverting to CBEC circular - CEGAT's earlier decision refused to be examined and matter remitted to Assistant Commissioner for reconsideration.

[Paras 2, 5 and 6]

Case Referred :-

Nat Steel Equipment Pvt. Ltd. v. Collector of Central Excise, 1988 (34) E.L.T. 8.

ORDER

In CA No. 96/2000

Ruma Pal, J. - The issue in this appeal relates to the classification of an electric flour mill under the Central Excise Tariff Act 1985. According to the appellant the machine is classifiable under Tariff Heading 8437 and according to the Revenue it is classifiable under 8509.

2. The Revenue after issuing a show cause notice had affirmed the demand against the appellant for Rupees one lakh nine hundred and eighty four. Penalty of Rupees two thousand and six hundred was also imposed under Rules 9(2) 52A and 173Q of the Central Excise Rules 1944. The Tribunal rejected the appellant's appeal solely on the ground that in an earlier year when the classification was in dispute, the Tribunal had in the assessee's own case by a judgment reported in 1994 (72) E.L.T. 222 held that the flour mill was classifiable under Tariff Heading 8509.

3. The Tribunal also noted that the appeal preferred by the appellant from the decision of the Tribunal was dismissed by this Court. Learned counsel appearing on behalf of the appellant has stated that the order of dismissal simply recorded that the appeal was dismissed without any reason in support thereof. The grievance of the appellant is that the Tribunal erred in relying upon its earlier decision in view of the fact that the earlier decision had been rendered prior to the issuance of a circular by the Central Board of Excise and Customs on 5.12.1994 in which it had been clarified that:

4. Learned counsel appearing on behalf of the respondent has on the other hand, submitted that in view of the fact that the earlier decision had been affirmed by this Court, the Circular did not have any relevance.

5. In our opinion this appeal must be allowed as contended by the learned counsel for the appellant. In the earlier decision the Tribunal had noted that the Gujarat High Court had held in the appellant's own case that the goods manufactured by the appellant were not classifiable under Tariff Entry 33-C of the Central Excise and Salt Act, 1944, as it stood prior to its amendment 1985, which related to domestic appliances and was classifiable under the residuary Tariff Entry 68. It also noted that Tariff Entry 33-C was substantially the same as Tariff Heading 8509. In these circumstances, logically the Tribunal should have followed the decision of the Gujarat High Court and affirmed that the appellant's goods were not classifiable under Tariff Heading 8509. However, the Tribunal relied upon the decision of this Court in Nat Steel Equipment Pvt. Ltd. v. Collector of Central Excise reported in 1988 (34) E.L.T. 8 and held that the machines were properly classifiable as a domestic appliance under Tariff Heading 8509. It is not for us to question the correctness of the earlier decision of the Tribunal since the appeal therefrom has already been dismissed by this Court. Nevertheless, we can certainly hold as we do, that the advent of the circular in 5.12.1994, after the earlier decision was rendered, was a relevant factor which should have been considered by the Tribunal untrammeled by the earlier decision rendered by the Tribunal. Furthermore, it may be noted that the Revenue ought to have considered the issue of classification on the basis of relevant material adduced by the parties. It does not appear from the records as produced before us that any such evidence was adduced.

6. For the reasons stated, we allow the appeal and set aside the decision of the Tribunal. The matter is remanded back to the appropriate Assistant Commissioner Central Excise, Anand to decide the question of the classification of the appellant's goods in the light of the observations contained in this order. It is made clear that this Court is not expressing any view on the merits of the case.

In CA No. 7598 of 99

7. In view of the order passed in Civil Appeal No. 96/2000 this appeal is also allowed and disposed of in the same terms.

Appeals Allowed