Needle Roller Bearing Co. Ltd. vs Collector of Central Excise, Bombay>1996(12)LCX0182

1996(12)LCX0182

S/Shri Lajja Ram, Member (T) and A.C.C. Unni, Member (J)

Final Order Nos. E/133-135/97-B, dated 5-12-1996 in Appeal Nos. E/1648-50/88-B1

Cases Quoted

Bajaj Auto Ltd. v. Collector — 1994(09)LCX0121 Eq 1994 (074) ELT 0599 (Tribunal) — Relied on ...................... [Para 7]

Kanwar Sewing Machine Co. v. Collector — 1983(02)LCX0049 Eq 1983 (012) ELT 0804 (Tribunal) — Relied on . [Para 8]

Advocated By : Shri Shiv Dev, Advocate, for the Appellants.

Shri P.K. Jain, SDR, for the Respondent.

[Order per : Lajja Ram, Member (T)]. - These are three appeals filed by M/s. Needle Roller Bearing Co. Ltd., Bombay, being aggrieved with the common Order-in-Appeal dated 28th March, 1988 passed by the Collector of Central Excise (Appeals), Bombay. The matter relates to the classification of needle roller, inner and outer rings/races, dowel pins and needle roller cages. The appellants were engaged in the manufacture of these products as well as ball or roller bearings. When these products were used in the manufacture of ball or roller bearings, there is no dispute that the appellants were classifying them under Heading No. 84.82 of the Schedule to the Central Excise Tariff Act, 1985 (the Tariff). When these parts were supplied to outside parties, they sought to classify them under Heading No. 84.85. The Revenue had taken a view that even when such parts were supplied to outside parties, they were correctly classifiable under Heading No. 84.82 of the Tariff by virtue of the section notes under Section XVI of the Tariff.

2. The matter was heard on 5-12-1996, when Shri G. Shiv Das, Advocate, stated that the goods in question i.e. needle roller, inner and outer rings/races, dowel pins and needle roller cages were not solely usable with the ball or roller bearings and that their customers have used them in the manufacture of gear boxes and propeller shaft assembly. It was his view that Section Note (c) of Section XVI was correctly applicable in their case and that they have correctly classified these parts under Heading No. 84.85.

3. In reply, Shri P.K. Jain, SDR, referred to the section notes and submitted that as these parts were parts of the ball or roller bearings, they were correctly classifiable under Heading No. 84.82. It was his submission that Heading No. 84.85 was a residuary entry and referred to machinery parts, not containing electrical connectors, insulators, coils contacts or other electrical features, not specified or included elsewhere in this Chapter No. 84. The ships’ propellers and blades therefore have been specifically mentioned therein. It was his plea that the classification under Heading No. 84.82 has been correctly decided by the learned Collector of Central Excise (Appeals), Bombay.

4. We have carefully considered the matter. Section Note (2) of Section XVI of the Tariff is reproduced below :

“2. Subject to Note 1 to 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, 85.44, 85.45, 84.46 or 85.47) are to be classified according to the following rules :

(a) Parts which are goods included in any of the headings of Chapter 84 or Chapter 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 Heading No. 85.43 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.

5. It is seen that if any part is specifically included in any particular heading, then it will be classifiable under that particular heading wherein it had been specifically mentioned. Other parts (which are not specifically included in any particular heading), 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. It is further stated that 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 under Heading No. 85.17. The classification under Heading No. 84.85 will be considered only when the parts are not otherwise classifiable in terms of Section Note 2(b), aforesaid. In this case, there is no dispute that all these parts were partly consumed captively in the manufacture of ball or roller bearings. Thus, they were suitable for use with the ball or roller bearings. The expression used in the Section Note is “solely or principally.”

6. The learned Advocate had submitted that these parts were used by their customers in the manufacture of gear boxes which were classifiable under Heading No. 84.83. We consider that the use of all these parts is through ball or roller bearings and as such parts in question were suitable for use principally with the ball or roller bearings, they were correctly classifiable under Heading No. 84.82 of the Tariff.

7. A view has also been expressed that the ball or roller bearings were not machines. Ball or roller bearings are part of the machines and as held by the Tribunal, part of a part is also a part. Refer Tribunal’s decision in the case of Bajaj Auto Ltd. v. Collector of Central Excise, Pune, 1994(09)LCX0121 Eq 1994 (074) ELT 0599 (Tribunal). Further, under Section Note 5 of Section XVI, the expression ‘machines’ means any machine, machinery, plant, equipment, apparatus or appliance cited in the headings of Chapter 84 or Chapter 85.

8. In the case of M/s. Kanwar Sewing Machine Co. v. C.C., Bombay, reported in 1983 (012) ELT 804, the Tribunal had held that Note 2(b) of Section XVI of the Customs Act requires that a part, if suitable for use solely or principally with a particular kind of machine, should be classified with machines of that kind.

9. As the parts in question were suitable for use principally with the ball or roller bearings, we consider that their classification under Heading No. 84.82, as decided by the learned Collector of Central Excise (Appeals), Bombay, is correct, and that there is no reason to consign these parts to the residuary entry under Heading No. 84.85.

10. Taking all the relevant considerations into account, we do not find any ground to interfere with the view taken by the learned Collector of Central Excise (Appeals), Bombay. As a result of this, all these three appeals are rejected.

_______

Equivalent 2000 (124) ELT 577 (Tribunal)