In Brief
A state-owned corporation manufacturing railway signaling equipment relays sought classification under tariff heading 8608 (railway equipment) rather than 8536.90 (electrical machinery). The Supreme Court held that relays manufactured solely for railway signaling use must be classified under 8608, applying the "principal use" test under Section XVII Note 3, despite Note 2(f) excluding electrical machinery. The Court also found show cause notices time-barred under Section 11A, as they sought to overturn a 1993 approved classification list three years later without evidence of fraud or willful misstatement. The appeals against the excise demand and penalties were allowed.
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