B.8 – Lucknow Zone – Classification – Classification of Goods Known as TASLA
An item by the name of ‘TASLA’ of Iron and Steel is being manufactured in this zone and the assessee is classifying the same under tariff item 82019000 as “other Hand Tools of a kind used in agriculture, horticulture or Forestry”. The process of manufacture adopted is procuring the iron and steel sheet, slitting and cutting circles out of it and pressing them in the deep drawing double action power press giving it a deep shape and folding corner edges for convenience and safety. The local Commissionerate is of the view that the said goods are better classified under tariff item 73239410 as “Ghamellas” on the grounds that the party has mentioned the product on its website as “Tasla a.k.a Ghamella ”. The local Commissionerate also relied on Rule 3(a) of the General Rules for the Interpretation of the Schedule to the Central Excise Tariff Act 1985 and the fact that the assessee sells their product at factory gate to the customers mainly situated in the city area. The end use of the product is in miscellaneous work and thus the claim of the party that their product is a tool for agricultural, horticultural or forestry use in field in not correct. The effective rate of duty in case of tariff item 73239410 is 12.5%. In view of the difference in rate of duty, the correct classification of the item needs to be decided.
Discussion & Decision
The conference discussed the issue after the details of the nature of the product and manufacturing process was explained by the sponsoring zone. It was noted that the scope of tariff item 7323 is in the nature of articles which are tableware and kitchenware and other household articles. In HSN these products are explained to include – Articles for kitchen use, Articles for table use and other household articles.
On the other hand tariff item 8201 applies to hand tools and other tools of a kind used in agriculture or forestry. Thus it is quite clear that for classification in tariff item 7323 the size and use of the product is relevant. From the description of the product as explained by the zone, it does not fit the description namely table, kitchen or other household articles of iron and steel. Specific heading of 73239410 meant for Ghamellas in the tariff would apply only to articles which qualify to be classified under tariff head 7323 and fits the description “Table, Kitchen or other household articles of iron and steel”. The quality of steel or iron is also a relevant consideration as goods need to be safe for use as kitchenware. In the present case these criteria are not satisfied. Classification of goods solely on the basis of description as Ghamella on website for sale is not a relevant consideration.
Rule 3(a) of the rules of interpretation has no application in the present case as rule 3 applies only as a sequel to rule 2(b). Rule 2(b) applies to mixtures and combinations, which is not the case at hand. The issue of classification of Shallow pan (ghamela/tasla) was also examined by Hon’ble tribunal in case of M/s Mehta Steel Industries [2000(120)ELT 583(Tri)] wherein it was held that “The product in question shallow pans apparently falls under Heading No. 82.01 of the Tariff as this heading covers not only hand tools, but also other tools of kind used in the agriculture, horticulture or forestry. The shallow pans are used in the agriculture, horticulture as well as forestry. The Asstt. Collector has rightly classified the product under this heading, keeping in view the Explanatory Notes under HSN. Being an implement of a kind used in the agriculture, Heading No. 73.26 of the Tariff as contended by the SDR, is not at all attracted in this case, as the same relates only to the other articles of iron and steel, forged or stamped, but not further worked. Keeping in mind the use of the product in question, and taking into consideration the HSN Explanatory Notes, the view taken by the Asstt. Collector as well as by the Commissioner (Appeals) classifying the product (shallow pans) under Heading No. 82.01 of the Tariff cannot be said in any manner erroneous so as to call for any interference in the appeal before us.”
The conference accordingly concluded that the ghamella/tasla of the kind described by the zone is correctly classified under tariff item 8201