1996(12)LCX0068

IN THE SUPREME COURT OF INDIA

S.P. Bharucha and S.C. Sen, JJ.

VOLTAS LTD.

Versus

COLLECTOR OF CUSTOMS, BOMBAY

Civil Appeal Nos. 2454-55 of 1987, decided on 5-12-1996

[Order]. - The appellants imported certain components for manufacturing electrostatic precipitators. Two separate bills of entry were filed for clearance of these goods. The Customs authorities classified the said goods under Heading 84.18(2) of the Customs Tariff Act, 1975. The appellants paid the duty under protest claiming that the correct classification would be Heading 84.17(1) as parts of plant and machinery and went up in appeal. The disputed Headings 84.01/02, 84.17(1) and 84.18 are set out as under :-

“84.01/02

Steam and other vapour generating boilers (excluding central, heating hot water boilers capable also of producing low pressure steam); superheated water boilers; auxiliary plant for use with such boilers (for example, economisers, superheaters, soot removers, gas recoverers and the like); condensers for vapour engines and power units.

84.17(1)

Machinery, plant and similar laboratory equipment, whether or not electrically heated, for the treatment of materials by process involving a change of temperatures such as heating, cooking, roasting, distilling, rectifying, sterilising, pasteurising, steaming, drying, evaporating, vapourising, condensing or, cooling, not being machinery or plant of a kind used for domestic purpose; instantaneous or storage water heaters, non-electrical;

(1)

Not elsewhere specified.

(2)

Machinery and equipment for food and drink other than those used for treating milk, instantaneous or storage water-heaters, non-electrical; machinery and equipment imported for use in air-conditioning.

84.18

Centrifuges, filtering and purifying machinery and apparatus (other than Filter funnels, milk strainers, and the like) for liquid or gases :

(1)

Not elsewhere specified.

(2)

Air filters; oil or fuel filters for internal combustion piston engines."

2. The Tribunal examined the entries and also examined the imported materials. The Tribunal came to the conclusion after examining the imported goods that the assessment under Tariff Item 84.18(2) of the goods was wrong. The Tribunal thereafter pointed out that the imported goods did not fall under Tariff Items 84.01/02 and 84.17. There was a specific and explicit coverage of electrostatic precipitators in Tariff Item 84.18, this heading being more specific and precise than the two other heads must receive first preference. The other heads asked for by the importers were less preferable and, in fact, they would not cover electrostatic precipitators. Accordingly, the classification asked for by the importers would not be in order. The Tribunal, however, stopped short of directing that the imported goods should be classified as electrostatic precipitators under Heading 84.18(1). Having reached the conclusion that 84.18(1) would have been the correct heading, there was no reason for the Tribunal merely to dismiss the appeals and uphold the Revenue’s contention. That means the Tribunal upheld the Revenue’s classification of the imported goods under Heading 84.18(2). After having held that this entry was inappropriate, the Tribunal should have given a direction to make the amendment under Heading 84.18(1) which, according to the Tribunal, was the correct classification.

3. In that view of the matter, the appeals are allowed to the above extent. The judgment and order under appeal is set aside. The goods imported by the appellants are directed to be classified under Heading 84.18(1). Each party will bear their own cost.

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Equivalent  1997 (91) ELT 261 (S.C.)

Equivalent 1997 (019) RLT 0828 (S.C.)