9911796707
TMI Blog2012 (7) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... o Ministry of Defence and para-military forces. The dispute is about classification of this product. While the appellant were classifying this product as "textile made up" under sub-heading 6307.90 of the tariff and paying duty on that basis at 8% adv. + Edu. Cess, according to Department its correct classification is under sub-heading 4202 00 of the tariff as - "haversack" where the rate of duty is 16% adv. + Edu. Cess. On this basis a show cause notice dated 3-5-2006 was issued to the appellant for - (a) demand of allegedly short paid duty amounting to Rs. 57,62,331/- in respect of clearances of SWE, during period from April, 2005 to March, 2006, alongwith interest on this duty at the applicable rate under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es over a long distance, that different components of SWE are meant as pockets for keeping different items, that SWE is worn on the body of soldier as read-ymade garment with the help of backless straps, belt waist etc., that as per essential character of the goods, in question, and also as per the functional test for the purpose of its classification, the goods, in question, would be classifiable as "textile made up" under Heading 63.07, not as travel goods under Heading 42.02, that from the photographs of persons wearing SWE, shown to the investigating officers, it is clear that SWE is worn by a soldier and in SWE there are pockets as well as arrangement to carry different items such as pack with aluminium frame, haversack, ammunition pou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; main component of SWE is haversack which is nothing but a strong bag slung from shoulders of a soldier for carrying his belongings and other item - pouch ammunition, belt waist and frog bayonet are fitted in and around the haversack - pouch ammunition is tied by the soldier on his waist, belt waist is so designed, as to fit in with the strap of haversack being carried on the soldier's back and thereby hold the haversack firmly and frog bayonet is used to hold bayonet and is attached with belt waist; (c) SWE is not a combat clothing or an article of apparel or ready-made garment in the pattern of dress, - it is an item like a rucksack or a bag for a soldier for keeping his belongings during his movement; and (d)&n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tile material, of vulcanised fibre or of paperboard, or wholly or mainly covered with such material or with paper. 63.07 other made up articles, including dress patterns. The sub-headings of this heading cover - "(i) floor cloths, dish cloths, dusters and similar cleaning cloth; (ii) life jackets and life belts; and (iii) other textile made ups." 7.1 Both the Headings 4202 and 6307 are identical to the corresponding HSN headings. 8. 'Webbing' is a strong fabric woven as a flat strip or tube of varying width and fibres. It is made from cotton/flax fibre, and synthetic fibres such as nylon, polyester, polypropylene etc. Webbing fabric is used in climbing equipment, parachute equ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g knives, portable tool boxes or cases, specially shaped or internally fitted to contain particular tools with or without their accessories etc." 9.2.1 Therefore ammunition pouches, and frog bayonets, in our view, would be covered by Heading 4202. 9.3 As regards "haversack", the same is a sack made of webbing cloth, which can be carried on one's back and is secured with two straps that go over the shoulders. The haversack is a container similar to "rucksack" covered by second part of Heading 4202. "Pack with aluminium frame" is also a backpack made of webbing cloth and in our view, is similar to "rucksack". Therefore, "pack with aluminium frame" and "Haversack" are covered by Heading 4202. 9.4 Belt waist is worn around the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le the penalty of Rs. 57,62,331/- has been imposed on the appellant-company, under Rule 25(1)(a) of Central Excise Rules, 2002, penalty of Rs. 50,000/- has been imposed on Shri G.K. Gupta, President of the appellant-company. 10.1 On the question of penalty, Commissioner's findings in para 69 of the impugned order are as under - "In the instant case, the party failed to pay the full amount of duty, thereby contravening the provisions of Rule 4 of Central Excise Rules, 2002 and failed to assess their goods, thereby contravening the provisions of Rule 6 of the Rules ibid. Thereby the party is definitely liable to penalty under Rule 25(1)(a) of Central Excise Rules, 2002. However, the provisions of Section 11AC are not invokable in the f ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
