Circular No. 308/24/97-CX dated 27/3/97

Subject: Central Excise - Excisability and classification of Cable Jointing Kits

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 to 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 into 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 up 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. Gable 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.

Sd/-
(S.C. Bhatia)
Under Secretary to the Govt. of India

F.No. 151/18/96-CX.4
(Note:- see Circular No.583/20/2001-CX dated 20.8.2001)

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