1994(12)LCX0061
IN THE CEGAT, SPECIAL BENCH ’B-1’ NEW DELHI
S/Shri Harish Chander, President, G.R. Sharma, Member (T) and Gowri Shanker, Member (T)
COLLECTOR OF CENTRAL EXCISE, PUNE
Versus
KIRLOSKAR BROS. LTD.
Order No.E/441/94-B1, dated 16-12-1994 in Appeal No. E/1722/93-B1 with E/Cross/179/94-B1
Advocated By : Shri K.K. Jha, SDR, for the Appellant.
None, for the Respondents.
[Order per : G.R. Sharma, Member (T)]. - Collector of Central Excise, Pune has filed this appeal against the order of Collector of Central Excise (Appeals). The Collector (Appeals) in this order had held:-
“I have carefully considered the submissions made by the appellants. I am in agreement with the submissions made by the appellants that the sleeve is intended to protect the shaft from wear and tear and that it is a part of the pump and not that of a shaft. I am, therefore in respectful agreement with the order-in-appeal passed by my learned predecessor vide his order-in-appeal No. P-228/1992 dated 18-6-1992 and hold that the sleeve should be considered as a part of the pump and not as the part of the shaft. The appeal is therefore admitted and the order passed by the Asstt. Collector is set aside.”
2. Briefly stated the facts of the case are that M/s. Kirloskar Bros. Ltd. are engaged in the manufacture of P.D. Pumps, Valves and Machine Tools and parts thereof covered under Heading Nos. 84.13, 84.81, 84.60 to 84.65 of the Central Excise Tariff Act, 1985. On 20-3-1990 appellants filed their revised classification list in which they had shown 18 parts like Shaft Sleeve, Rubber Bearings, Line Shaft Bearings, Transmission Bearings, Spindles, Thrust Bearings, Bush etc. under the same heading in which the principal machinery or device is classifiable and claimed the rate of duty at 15% ad valorem. After examining various contentions, the ld. Asstt. Collector in his Order dated 4-4-1991 on Sleeves had held:
“The Sleeve in question is a shaft sleeve and is meant for protecting the main shaft from the wear and tear during the rotation of the shaft. The assessees have also accepted that it saves extra expenditure in replacing the total shaft (if without sleeve) during over-hauling of the shaft. In this particular design of the shaft, where there is a provision for sleeve, the shaft cannot function without sleeve. In short, I have noticed that the sleeve in this case, functions as a part of the shaft and as the shaft itself is a machine as per Section Note 5 of Section XVI cited in Heading No. 84.83, the classification of Sleeve is to be made with classification of shaft under Heading No. 84.83 only as per Section Note 2(b) of Section XVI.”
3. Sh. K.K. Jha, the ld. SDR appearing for the appellant submitted that as per Section note 2(b) of Section XVI, CETA, 1985 Sleeve is a part of the shaft and would be classifiable under 84.83. Since the function of Sleeves is to protect the Shaft, it has to be treated as a part of the Shaft.
4. Reading from the description of the goods against Chapter Sub-heading 84.83, the Transmission Shafts (including Cam Shafts) and Cranks; Bearing Housings and Plain Shaft Bearings; Gears and Gearing; Ball Screws; Gear boxes and other speed changers, including torque converters; flywheels and pulleys, including pulley blocks; clutches and shaft couplings (including universal joints) the ld. SDR submitted that the description clearly includes parts of Shaft and since Sleeves are parts of shafts therefore they are classifiable under Chapter Sub-heading 84.83. Reiterating the findings of the ld. Asstt. Collector the ld. SDR prayed that the order passed by the Collector (Appeals) may be set aside.
5. From the records, we find that there is a request from the respondents to consider their case on merits. The respondents have filed Cross Objection. Heard the submissions of the ld. SDR perused the records and the Cross Objections and considered them.
6. From the order of the Collector (Appeals), we find that the Collector has only gone into the question of classification of Sleeves, though, classification of a number of items was gone into and decided by the Asstt. Collector in his order in original. In the appeal the Collector has raised a number of issues including the classification of Sleeves. However, the ld. SDR while arguing the case on behalf of the Department agreed not to press other points except the question of classification of Sleeves.
7. There are two competing entries in the instant case for classification of Sleeves, whereas the appellants have claimed the classification of Sleeves under Chapter sub-heading 84.83 as parts transmission of shafts, the Collector of Central Excise (Appeals) had in his order decided the classification of Sleeves under Chapter sub-heading 84.13 as parts of pumps for liquids.
8. Before proceeding further, we would like to see what the two entries cover. Chapter sub-heading 84.13 covers :-
“Pumps for liquids, whether or not fitted with a measuring device; liquid elevators.”
Chapter sub-heading No. 84.83 covers :-
“Transmission shafts (including cam shafts and crank shafts) and cranks; bearing housing and plain shaft bearings; gears and gearing; ball screws; gear boxes and other speed changers, including torque converters”
9. On a close examination of the description of the goods covered by the two competing entries we find that Chapter sub-heading 84.13 does not appear to cover parts thereof. However, Note 2 of Section XVI provides :-
“Subject to Note 1 of this Section, Note 1 to Chapter 84 and to Note 1 to Chapter 85, parts of machines (not being parts of the articles of Heading No. 84.84, 85.46 or 85.47 are to be classified according to the following rules :-
(a).................
(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 Heading No. 84.43) are to be classified with the machines of that kind. However, parts which are equally suitable 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."
This note clearly shows that parts if suitable for use solely or principally with a particular kind of machine or with a number of machines of the same heading are to be classified with the machines of that kind.
10. The machine (Pump) in the instant case is classifiable under Chapter Heading 84.13 whereas Shafts are classifiable under Chapter Heading 84.83. Now the question for determination before us is whether Sleeves is a part of the Shaft or Pumps. The Department has argued that Sleeves are essential for proper functioning of the shaft. However, there is no evidence to prove that Sleeves is a part of the Shaft. No evidence has been brought on record to prove that Sleeves is a part of the Shaft. Entire reliance by the Deptt. is on the point that the Sleeve is meant for protecting the main shafts from wear and tear during the rotation of the shafts. The Department has also pleaded that the Shaft cannot function without Sleeve and that the Shaft itself is a machine as per the Section Note 5 of Section XVI cited in Heading No. 84.83, the classification of Sleeves is to be made with classification of Shaft under Heading No. 84.83 only as per Section Note 2(b) of Section XVI. The Department has supported their contentions on the following issues :-
1. Sleeve is meant for protecting the Shaft.
2. Shaft cannot function without Sleeve, and
3. Shaft itself is a machine.
11. On the first and the second issue in the above para we find that Sleeve may be an essential item for protecting the shaft but cannot be termed as a part of the Shaft. The cover of a chain of the cycle may be essential for protection of the chain but it cannot be called a part of the cycle chain. The Department has not produced any other evidence to prove that Sleeve is a part of the Shaft. Simply, an item which protects another item and helps in its smooth functioning cannot essentially be a part of the main item.
12. On the third issue, we are unable to agree with the Department’s contentions that the Shaft is a machine in itself. Shaft may be a specified item for purpose of Tariff. We observe that Transmission shafts usually transmit a rotary motive power and are driven directly or by a motor. Thus transmission shaft by itself cannot in the instant case, be termed a complete machine, and therefore, Sleeve cannot be considered as a part of the Shaft and, therefore, the third issue is also answered.
13. New Mechanical Dictionary by Andel defines shaft as “A bar having one or more journals on which it rests and revolves and intended to carry one or more wheels or revolving parts as a shaft of the steam engine.” Shaft has been defined in the Dictionary of Technical terms by E.S. Crispin as, “An axle or bar usually cylindrical used to support rotating pieces or to transmit power to motion by rotation.”
14. In the Explanatory Note (5) on page 1326, it has been clarified that Transmission Shafts include cranks and crank shafts. These may be either made in one piece or assembled from several parts. They receive a reciprocating motion (e.g. from a piston engine) and convert it into rotatory movement, or vice-versa.
15. From the above, it is clear that a shaft is either a single piece or assembled from several parts making it as a single unit and supports and protection devices will not be a part of the shaft.
16. It is an admitted position that sleeve is fitted in the pump and thus can be termed as a part of the Pump. By virtue of Section Note 2(b) of Section XVI sleeve is a part of the fluid pump and would be classifiable under Chapter Heading 84.13.
17. Having regard to all the facts and circumstances of the case, we hold that Sleeve is a part of the Pumps for liquids and is, therefore, classifiable under Chapter heading 84.13
18. In view of the above findings, the impugned order is upheld and the appeal is rejected.
Equivalent 1995 (76) ELT 216 (Tribunal)