Collector of Central Excise vs Gakso Refrigeration Engineers>1992(06)LCX0051

1992(06)LCX0051

BEFORE THE CEGAT, SPECIAL BENCH ‘B1’, NEW DELHI

Shri P.C. Jain, Member (T) and Ms. S.V. Maruthi, Member (J)

COLLECTOR OF CENTRAL EXCISE

Versus

GAKSO REFRIGERATION ENGINEERS

Order No. E/164/92-B1, dated 26-6-1992 in Excise Appeal No. E/2281/91-B1

Advocated By : Shri S.K. Sharma, JDR, for the Appellant.

Shri A.P. Kumtakar, Consultant, for the Respondents.

[Order per : S.V. Maruthi, Member (J).]. - The question for consideration is whether the two items namely Ice cream machine and Ice candy machine can be given the benefit of Notification No. 175/86, dated 1-3-1986.

2. The relevant notification exempts the specified goods mentioned in the Annexure. Clause 4(iv) of the Annexure says that “all other goods specified in the said Schedule other than the following namely refrigerating and air-conditioning appliances and machinery and apparatus and accessories thereof.” In other words, the exemption is applicable to all other goods falling in the Schedule to the Central Excise Tariff Act, 1985 except in relation to the refrigerating machinery, which is the relevant item for the purpose of deciding the dispute in question. Refrigerating machinery is classified under tariff Heading 8418 which reads as follows :-

1. Refrigerators, freezers and other refrigerating or freezing equipment, electric or other heat pumps other than air conditioning machines of Heading No. 84.15.

3. The Assistant Collector held that the two items viz. Ice cream machine and ice candy machine cannot be classified under Item 8418 as they cannot be either refrigerator or freezer. He also held that the two machines are machines which treat the material by change of temperature by cooling the homogenized mixture into Ice cream and Ice candy. Therefore, he classified them under sub-heading 8419. He also took support from the explanatory note of CCSH which states that the said tariff heading specifically excludes freezing salt type freezers which falls under 8410 or 8419. However, the Assistant Collector denied the benefit of exemption Notification No. 175/86, dated 1-3-1986 on the ground that the refrigerator and air conditioning machinery and appliances are excluded from the said notification. Before the Collector of Appeals, the classification of the goods under Tariff Heading 84.19 was not disputed. Therefore, the Collector held that when once they are not classified under Tariff Item 8418 as refrigerator and refrigerating equipment, they do not fall under the exclusion clause of the Notification No. 175/86, dated 1-3-1986 and holding this extended the benefit of Notification. Hence the Department’s appeal before us.

4. The main contention of the Department is that refrigerating and air conditioning machinery and appliances is a general term to be used for machinery having functions of air/liquid cooling and freezing. There is no one heading provided for this machinery in the present tariff and hence the Collector (Appeals)’s finding that refrigerating and air-conditioning appliances and machinery are specifically and exclusively covered under Tariff Heading 8518 is not correct. It is submitted that the refrigerating and air conditioning machinery parts and accessories are spread over under a number of Chapter sub-headings, viz. 8415, 8418, 8419, 8476, 8481, 8536 and 9032 etc. Hence, Ice cream machines and Ice candy machines which fall under Heading 8419 are still Air conditioning and refrigerating machines ineligible for the benefit of Notification No 175/86 under para 4(iv) of its Annexure. The question, therefore, is whether the goods having been classified under 8419 whether they fall within the exclusion clause of the Notification No. 175/86.

5. The classification of two items under 8419 is not disputed. The notification excludes only refrigerating machinery, and parts and accessories thereof. Admittedly, these two items are not classifiable under “refrigerators or refrigerating equipment parts and accessories thereof.” When once they are excluded under the specific heading and classified under 8419 namely “machinery for the treatment of materials by process involving a change of temperature such as heating, cooking, roasting, distilling ........... condensing or cooling, other than machinery or plant of a kind used for domestic purposes; instantaneous or storage water heaters, non-electric,” they cannot be brought under the exclusion clause. Since the classification is Heading 8419 and since the exclusion clause relates to the Heading 8418 and 84.15 the Collector is justified in extending the benefit of exemption Notification to the goods in dispute as the notification excludes specifically goods falling under 8418 and 84.15 whereas the goods in dispute are classified under 8419. We, therefore, agree with the Collector and dismiss the appeal of the Department.

Equivalent 1993 (63) ELT 568 (Tribunal)