Counsel for the Parties :For the Appellant : R. Venkataramani, Sr. Advocate,­ G. Umapathy, P Parmeswaran, Ashok Panigrahi, S. Gowthaman, B. Krishna Prasad, Advo­cates.For the Respondents : A.K. Jain, Rajesh Kumar, Rajesh Jain and Ms. Rajni, Advocates.

Judgment

S.N. Variava, J.—These Appeals are against the Judgment dated 22nd of January 1999 of the Customs, Excise and Gold (Control) Appellate Tribunal [CEGAT].

2. Briefly stated the facts are as follows.

The question involved is whether the goods manufactured by the Re­spondents fall under Tariff Item 94.01 or Tariff Item 40.08. It is an admitted position that the Respondents manufactured goods made out of vulcanised rubber, other than hardened rubber, and their goods are cut to the shape of seats of motor vehicles or two wheelers. The Respond­ents had filed a classification list showing the products under Tariff Heading 40.08. This had been approved. However, a show-cause notice dated 17th May 1990 was issued by the Assistant Commissioner raising a demand for the differential duty on the ground that the products should correctly be classified under Tariff Item 94.01. After giving a personal hearing, the Assistant Commissioner confirmed the demand. Thereafter, three further show-cause notices dated 31st May 1990, 1st May 1990 and 31st May 1990 respectively were issued to the Respondents calling upon them to show-cause notice as to why the benefit wrongly availed of them under Notification No. 175 of 1986 dated 1st March 1986 be not cancelled. The Respondents were called upon to pay duty. After hearing the Respondents, by Orders dated 13th March 1991, it was held that the Respondents were not entitled to exemption. They were called upon to pay duty.

3. It must be mentioned that the Board issued a clarification that the goods of the kind manufactured by the Respondents were classifiable under Tariff Heading 94.01 if they were meant for seats of motor vehicles and Tariff Heading 87.14 if they were meant for seats of two wheelers.

4. The Respondents filed the Appeals, which were dismissed by the Commissioner (Appeals). The Respondents then filed further Appeals to CEGAT. Earlier decisions of CEGAT, holding that such goods fell under Tariff Heading 94.01 were cited. In spite of that CEGAT concluded, in the impugned Judgment, that such goods should fall under Tariff Head­ing 40.08. In so doing, CEGAT relied upon another Judgment of the Tribunal which had dealt with earlier Tariff Headings 16A and 34A. It must be mentioned that those Tariff Headings were completely different from the Tariff Headings now under consideration.

5. Tariff Headings 94.01 and 40.08 read as follows :

“94.01 : Seats (other than those of heading No. 40.01), whether or not convertible into beds, and parts thereof.

40.08 : Plates, blocks, sheets, strikes, rods and profile shapes of vulcanized rubber other than hardened rubber of cellular rubber.”

6. It is also necessary to consider certain Chapter Notes which have been relied upon by the parties. In Chapter 94, Notes 1(a) and (2) read as follows :

“1. This Chapter does not cover:

(a) Pneumatic or water mattresses, pillows or cushions, of Chap­ter 39,40 or 63;

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2. The articles (other than parts) referred to in heading Nos. 94.01 to 94.03 are to be classified in those headings only if they are designed for placing on the floor or ground.

The following are, however, to be classified in the above-mentioned headings even if they are designed to be hung, to be fixed to the wall or to stand one on the other :

(a) Cupboards, bookcases, other shelved furniture and unit furniture;

(b) Seats and beds.”

In Chapter 40, Notes 2(e) and 9 read as follows: ­

“2. This Chapter does not cover:

(a) ................

(b) ................

(c) ................

(d) ................

(e) Articles of Chapter 90, 92, 94 or 96;

(f) ................”

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9. In heading Nos. 40.01, 40.02, 40.03, 40.05 and 40.08, except as otherwise provided, the expressions ‘plates’, ‘sheets’ and ‘strips’ apply only to plates, sheets and strip and to blocks of regular geo­metric shape, uncut or simply cut to rectangular (including squa