NORTH WEST SWITCHGEAR LIMITED Vs. COMMNR OF CENTRAL EXCISE NEW DELHI
LAWS(SC)-2006-2-13
SUPREME COURT OF INDIA
Decided on February 14,2006

NORTH WEST SWITCHGEAR LIMITED Appellant
VERSUS
COMMNR.OF CENTRAL EXCISE, NEW DELHI Respondents

JUDGEMENT

Bhan, J. - (1.)THIS order shall dispose of the two sets of Civil Appeals. The Civil Appeal Nos. 553-554 of 2001 filed by M/s. North West Switchgear Limited and the Civil Appeal No. 4382 of 2001 filed by M/s. Kesharbai Electronics Pvt. Ltd.: (for short "the appellants"). As the point involved in both the sets of appeal is similar, they are being disposed of by a common order.
(2.)THE Civil Appeal Nos. 553-554 of 2001 have been filed by M/s. North West Switchgear Limited under Section 35L of the Central Excise Act, 1944 (for short "the Act") against final order No. 120-121/2000-B passed by the Customs Excise & Gold (Control) Appellate Tribunal, New Delhi in Appeal No.E/506/95-B and E/1554/96-B dated 20.1.2000 whereby the Tribunal upheld the orders of authorities below to drop the demands of Rs. 2.02.506.88 & Rs. 93.514.38 raised on the appellants by the respondent herein, but, held that the 'fan regulators' manufactured by the appellants were classifiable under subheading 8414.99 as opposed to 8414.20 as an accessory of the fans.
The Civil Appeal No. 4382 of 2001 filed by M/s. Kesharbai Electronics Pvt. Ltd., has also been filed under Section 35L of the Act against the final order passed by the Tribunal at Mumbai dated 16.11.2000 in Appeal No. E/1002/R/95 Mumbai, whereby the Tribunal rejected the appeal filed by the appellants and confirmed the classification of the goods under sub-heading 8414.99 as classified by the Assistant Collector of Central Excise & Customs, Ahmednagar and confirmed by the respondent in Appeal bearing No.A/418/ 1995 dated 29.9.1995.

The facts of Civil Appeal No. 553-554 of 2001 are:

The appellants are engaged in the manufacture of switches, fan regulators and distribution board etc falling under Chapter subheading No. 8536.90, 8414.20 & 8537.00 of the Central Excise Tariff Act, 1985 (hereinafter referred to as "the Tariff Act"). The appellants classified 'fan regulators' under subheading No. 8414.20 of Tariff Act, which covers electric fans, on the strength that there is no other use of these items and these are used principally and solely with the electric fans. The classification list filed by the appellants for clearing the same under sub-heading 814.20 was approved by the Assistant Commissioner.

(3.)THE appellants were served with demand-cum-show cause notices dated 3.12.1993 and 28.6.1994 for the period March 1993 to February 1994 to show cause to the Deputy Commissioner of Central Excise, Faridabad as to why the differential duty amounting to Rs. 2,02,506.88 and Rs. 93,514.38 should not be demanded and recovered under Rule 9(2) read with Section 11A of the Act on the contention that 'fan regulators' are nothing but 'accessories' of electric fans and the same are classifiable under subheading 8414.99 of the Tariff Act which attracts duty @ 15% ad valorem instead of 10% ad valorem already paid by the appellants resulting in short payment of duty as aforementioned. THE appellants submitted their reply to the show-cause-notices contending therein that they had paid the duty correctly and there was no short levy of duty as alleged by the show-cause-notice; that the fan regulators are correctly classifiable along with the fans according to the Section Notes/Chapter Notes appended to Chapter 84 of the Tariff Act, 1985. It was also submitted that the appellants are covered by Board Circular No. 7/87 dated 24.06.1987 which was in force till the issuance of the CBEC Circular No.192/26/96-CX dated 27.06.1996.
Authority in original in show cause notice dated 3.12.1993 held that the fan regulators were classifiable under the sub-heading 8414.20 as had been contended by the assessee. It was also held that the Board Circular No. 7/87 dated 24.6.1987 was applicable to the facts of the case. The Commissioner of Central Excise reviewed the order passed by the authority in original in exercise of its powers under Section 35E(2) and directed that an appeal be preferred accordingly and appeal was filed. The appellants filed their memorandum of cross objection. The learned Commissioner upheld the order passed by the authority in original holding that 'fan regulators' were/are classifiable under sub-heading 8414.20 of the Tariff Act and not under 8414.99 and rejected the appeal. Being aggrieved with the order passed by the Commissioner of Appeals, the revenue preferred appeal No. E/Appeal No. 506/95-B before the Tribunal.



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