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Regarding Central Excise - Excisability and classification of Cable
Jointing Kits
Circular
No. 308 dated 27th March 1997
I
am directed to say that certain doubts have been expressed as to whether the
process of putting together a number of duty paid articles into a container like
carton, kit etc. to be marketed as "Cable Jointing Kits" would amount
of manufacture or not. In this process either the duty paid articles are
procured entirely from the open market or some articles are manufactured by
kitters and others are bought out. these articles are then put into a container
like box, kit etc. and supplied as cable jointing kit.
2.
The matter has been examined by the Board in depth. It is observed that
the individual articles in the cable jointing kits are classified under
different chapters/headings of Central Excise Tariff Act, 1985. the articles put
up together carry out a specific activity, i.e. protecting, insulating and
jointing the telecommunication cables. By putting together these articles in to
a container a new commercially distinct product, viz., cable-jointing kit comes
into existence having a different name, use and character. The classification of
cable jointing kits as "goods put in sets" has to be done, applying
interpretative Rule 3 (b), according to the component, which gives them their
essential character.
3.
Under Customs Tariff Advice No. 1/89 dated 17.11.1989, Board advised that
the Cable Sealing System/ Kit is classifiable under Chapter Heading 85.47 of
Customs Tariff. This classification was further confirmed in the Conference of
collectors of customs held in July, 1990 at Madras. the Bombay High court in the
case of M/s. X.L. Telecom Pvt. Ltd. [1993 (47) ECR 171 (Bombay)] also decided
that cable jointing kit is classifiable under heading 85.47.
4.
In view of the above facts, Board is of the view that the process of
putting together the duty paid articles into a container like carton, kit etc.
so that a new commercially distinct product viz. Cable Jointing Kits comes into
existence would amount to manufacture under Section 2 (f) of Central Excise Act,
1944 and such Cable Jointing kits are appropriately classifiable under heading
85.47 of Central Excise Tariff Act, 1985.
5.
Trade and field formations may be informed accordingly.
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