1997(01)LCX0142

IN THE CEGAT, SOUTH ZONAL BENCH, MADRAS

S/Shri V.P. Gulati, Vice President and T.P. Nambiar, Member (J)

COMMISSIONER OF CUSTOMS, MADRAS

Versus

ABEL TRONICS LTD.

Order No. 316/97, dated 7-1-1997 in Appeal No. C/R-395/95

Advocated By : Shri R. Victor Thiyagaraj, SDR, for the Appellant.

Shri I. Arokiaswamy, Consultant for the Respondent.

[Order per : V.P. Gulati, Vice President]. - The issue in the appeal relates to the assessment of parts of moulds. The Learned lower authority has held the goods to be assessable under tariff heading 8480 invoking the provision of Section Note 2 to Section XVI. The revenue is seeks assessment of the goods under tariff heading 84.85 and it has been urged in the grounds of appeal that tariff heading 84.80 covers only the moulds and parts could not be assessed under this tariff heading and the only other heading available for the purpose is 84.85.

2. The Learned SDR, Shri R. Victor Thiyagaraj for the department has reiterated the grounds in the appeal memorandum. We had put it to the Learned SDR as to how the reliance of the Learned Lower Appellate Authority to Section Note 2 for assessment of goods under tariff Heading 84.80 is not correct in law. He merely stated that since 84.80 covers only moulds. The question of invoking the provision of Section note could not arise.

3. The Consultant for the appellants Shri I. Arokiaswamy has pleaded that in terms of interpreted rules, the classification of the goods has to be done after taking into consideration the Section notes and Chapter notes. He has pleaded that the Learned Lower Appellate Authority has correctly interpreted the Law while holding the goods to be assessable under tariff heading 84.80.

4. We have considered the pleas made by both the sides. We observe that tariff heading 84.80 covers the moulds and the tariff headings reads as under :-

“Moulding boxes for metal foundry; mould bases; moulding patterns; moulds for metal (Other than ingot moulds), metal carbides, glass, mineral materials, rubber or plastics”.

The parts of moulds are not specifically covered under this tariff heading. We observe that Section Note 2 to Section XVI deals with the methodology for assessment of parts of the machines covered under this Section (the Section under which Chapter 84 falls). The relevant provisions are set out in sub-para (a), (b) & (c) which are re-produced below for convenience of reference.

“(a). Parts which are goods included in any of the headings of Chapter 84 or 85 (other than heading nos. 84.85 and 85.48) are in all cases to be classified in their respective headings.

(b). Other parts, if suitable for use solely or principally with a particular kind of machine, or with a number of machines of the same heading (including a machine of heading no. 84.79 or 85.43) are to be classified with the machine of that kind. However, parts which are equally suitably for use principally with the goods of heading nos. 85.17 and 85.25 to 85.28 are to be classified in heading no. 85.17.

(c). All other parts are to be classified in heading nos. 84.85 or 85.48."

A perusal of (a), (b) & (c) shows that the assessment of the parts has been ordered based on nos.

1. A specific inclusion for the parts under various tariff headings.

2. Based on the use and the suitability of the parts for the specific purpose of a particular machine.

3. The residuary items of the parts.

In the scheme of the tariff therefore the assessment of the parts under various headings would depend upon the criterion set out under paras (a), (b) & (c) and the parts are to be assessed accordingly. The parts may be specifically covered under particular heading or they may not be covered under a particular heading. When the same are covered under a particular heading in terms of para (a) and these have to be assessed under that heading. If the parts can be functionally identified with a machine, the assessment of the goods has to be done in terms of sub-para (b) under the heading of the machine for which the part is solely and principally meant. The finding of the fact by the Learned lower authority is that the parts imported are identifiable parts of the moulds and this is not controverted. These can therefore be considered as suitable for use solely or principally with the moulds. If that be so, the reasoning of the Learned lower authority for assessing the goods under tariff heading 84.80 has to be accepted. We, in the circumstances hold that the Learned Lower authority has rightly interpreted the Law while holding the assessment under tariff heading 84.80. We, in this view dismiss the appeal of the revenue. In regard to second item involved, the Learned Consultant for the respondent has pleaded that he accepts the classification as ordered by the original authority. Therefore the issue relating to that does not survive for our consideration and the plea for assessment as prayed for by revenue is allowed. The appeal is partially allowed in the above terms.

Equivalent 1997 (93) ELT 289 (Tribunal)

Equivalent 1997 (020) RLT 0459 (CEGAT-SZB)