2006(07)LCX0185

In the Customs, Excise & Service Tax Appellate Tribunal, Bangalore

Dr. S.L. Peeran, Member (Judicial) and Shri T.K. Jayaraman, Member (Technical)

Westfort Hi-Tech Hospital Ltd.

Versus

Commissioner of Customs, Cochin

Final Order No. 1189/2006 dt. 14.7.2006 in Appeal No. C/110/2004

Cases Quoted -

Becton Dickinson Vs. CC, Madras 1998 (028) RLT 0068 (CEGAT)-Referred [Para 4]

Prosoya Industries Ltd. Vs. CC New Delhi 1995(02)LCX0127 Eq 1995 (078) ELT 0344 (Tri.) - Referred

Advocated By -

Shri M. Balagopal, Adv. for Appellant
Shri R.K. Singla, JCDR for Respondent

Per T.K. Jayaraman :

This appeal has been filed against the OIA No. 04/2004 dated 27.01.2004 passed by the Commissioner of Customs (Appeals), Cochin.


2. The appellants imported 8 pieces of Hospital Operation Theatre Lamps and claimed their classification under CSH 9018.19 of the Customs Tariff Act. But, the original authority did not agree with the classification claimed by the appellant and re-classified the goods under CSH 8539.39 which covers 'Other Discharge Lamps'. The classification claimed by the appellants cover 'Other Electro Medical Apparatus' and the rate of duty was 25%+Nil+4%. However, the rate of duty as per CSH 8539.39 was 35%+16%+4%. The appellant paid an amount of Rs. 8,58,591/- under protest. They approached the Commissioner (Appeals) for relief. The Commissioner (Appeals) stated that HSN Explanatory Notes amplify the scope of Other Electro Medical Apparatus' to cover only the medical apparatus, which has preventive, curative or diagnostic purpose. Further, he stated that the operating lights cannot be treated as having either a preventive, curative or diagnostic purpose. On this ground, he rejected the claim of the appellants and upheld the order of the original authority. The appellants have challenged the impugned Order-in-Appeal.


3. Shri M. Balagopal, the learned Advocate, appeared for the appellants and Shri R.K. Singla, the learned JCDR for the Revenue.


4. The learned Advocate urged the following points:-

(i) The impugned goods are solely used at the surgical site by the Surgeons. They do not have any other use.

(ii) The lights have been specially designed for operation theatre so that light radiates from the rim of the light head and the potential areas of shadow are brightened. With the aid of suitable filters for infra-red radiation, temperature increase is limited to less than 2°C. There are many more features incorporated in the lights for the special purpose of operation theatre.

(iii) CTH9018.90 does not cover exclusively Electro Medical Apparatus. The description as per the Customs Tariff is "Other Instruments and Appliances". Under the Heading Instruments and Appliances for human medicine or surgery, the HSN Notes states that these instruments include among others "mirrors and reflectors." Therefore, the shadow less operating lights are clearly covered by the description "instruments and appliances" under the CTH 9018.90.

(iv) In the case of Beet on Dickinson Vs. CC, Madras -1998 (028) RLT 0068 (CEGAT)=1998(06)LCX0055 Eq 1998 (103) ELT 0177 (Tri.), the Tribunal classified a product described as Destruclip under 9018.90 of CTA instead of 8205.59 as a Tool. This instrument is meant for destroying the used syringes and needles. The Tribunal held that this product is a medical appliance and shall be classifiable under 9018.90.

(v) Since the impugned goods are specifically made for the purpose of conducting surgical operations, the classification of them under the general heading under CTH 85.39 was not at all correct. The Tribunal, in the case of Prosoya Industries Ltd. Vs. CC, New Delhi -1995(02)LCX0127 Eq 1995 (078) ELT 0344 (Tri.), examined the classification of Bio Health Heater. Even though it had various uses, the Tribunal classified the item under 90.18 and ruled out the classification under 3926.90. Since the impugned goods do not have any other use other than in the operation theatre, they have a better claim for classification under 90.18 than the Bio Health Heater, which is the subject matter of the above decision.

(vi) Alternatively, it was submitted that even if the classification is held to be under CSH 8205.59, the impugned goods are entitled for the benefit of exemption Notification 17/2001 dated 1.3.2001 under Sl. No. 254, Item No. 6 in List No. 21. In this Notification, operating lamp (shadowless) is exempted from Customs duty in excess of 15% ad valorem irrespective of the classification. This point has not at all been considered by the Commissioner (Appeals) even though it had been pleaded before him.


5. The learned JCDR pointed out that the Operation Theatre Lights cannot be considered as Instruments and Appliances and therefore, classification under CH 90.18 is ruled out. He urged that the impugned order is legal and proper and the same may be upheld.


6. We have gone through the records of the case carefully. The technical literature produced highlights the special features of the impugned product. There is minimum shadow formation and optimized depth of illumination. The light radiates from the rim of the light head and potential areas of shadow are brightened. As a result of the above design, the light is homogeneous and arrangement of filters for infra red radiation limits the temperature increase to only 2°C. The suspension is designed in such a manner that light heads can be positioned with the touch of the hand and without restriction. The shape of the light head is aerodynamic and its concave underside restricts any turbulence that may occur to the area immediately below the light head.

6.1 Now let us examine the HSN Explanatory Notes. Under the Heading, 90.18, the following note is given:

9018.90 - Other instruments and appliances

This heading covers a very wide range of instruments and appliances, which, in the vast majority of cases, are used only in professional practice (e.g. by doctors, surgeons, dentists, veterinary surgeons, midwives), either to make a diagnosis, to prevent or treat an illness or to operate, etc. Instruments and appliances for anatomical or autoptic work, dissection, etc., are also included, as are, under certain conditions, instruments and appliances for dental laboratories. The instruments of the heading may be made of any material (including precious metals). The Commissioner (Appeals) is of the view that these Operation Theatre Lights cannot be treated as having either a preventive, curative or diagnostic purpose. We do not understand how he has come to such a conclusion. Any surgery or operation will either have a curative or preventive purpose. There are many cases where advise is given for surgical operation in order to prevent certain future complications. In many cases, surgery definitely has curative purposes. Therefore, the Commissioner (Appeals) has adopted a view without any basis. We should also bear in mind that these lights have specifically been designed for Operation Theatre. In that view of the-matter, these, lights can be considered as Appliances coming under CSH 9018.19 as Other Electro Medical Apparatus. Therefore, we allow the appeal with consequential relief by setting aside the impugned order in appeal.

Pronounced in open Court on 14.7.2006.

Equivalent 2006 (077) RLT 0064 (CESTAT-Ban.)

Equivalent 2006 (204) ELT 0113 (Tri. - Bang.)