Collector of Central Excise, Bangalore vs Peenya Engg. Industries>1997(02)LCX0062

1997(02)LCX0062

IN THE CEGAT, COURT NO. II, NEW DELHI

S/Shri Lajja Ram, Member (T) and S.S. Kang, Member (J)

COLLECTOR OF CENTRAL EXCISE, BANGALORE

Versus

PEENYA ENGG. INDUSTRIES

Final Order No. E/572/97-B, dated 17-2-1997 in Appeal No. E/3139/88-B

Advocated By : Shri A.K. Agarwal, SDR, for the Appellant.

None, for the Respondents.

[Order per : Lajja Ram, Member (T)]. - This is an appeal filed by the Revenue being aggrieved with the Order-in-Appeal dated 31-8-1988 of the Collector of Central Excise (Appeals), Madras. The respondents are M/s. Peenya Engg. Industries, Bangalore.

2. The matter relates to the classification of the storage tanks and vessels prior to 1-3-1988. The respondents had sought to classify the storage tanks and vessels manufactured by them under Heading No. 7308.90 of the Schedule to the Central Excise Tariff Act, 1985 (hereinafter referred to as the `Tariff’) as other articles of Iron and Steel - other. The Asstt. Collector of Central Excise, Bangalore observed that the goods in question were containers made of base metal and were correctly classifiable under Heading No. 3312.90 of the Tariff which covered containers of base metal other than those covered under sub-heading Nos. 8312.11, 8312.12 and 8312.19 of the Tariff. The Collector of Central Excise (Appeals), Madras allowing the appeal of the respondents (appellants before him) held that the storage tanks and vessels in question were not containers ordinarily intended for packaging of goods for sale, but ordinarily intended for storing liquid in one place, though by containing liquid inside the containers.

3. The matter was posted for hearing on 17-2-1997. The respondents have requested for decision on merits.

4. We have heard Shri A.K. Agarwal, SDR for the appellants/Revenue and have gone through the relevant Tariff Entries and have perused the written submissions made by the respondents before the Asstt. Collector of Central Excise, Bangalore.

5. There is no dispute that the goods manufactured by the respondents were storage tanks and vessels for containing liquids. The Central Excise Tariff relating to ferrous and non-ferrous metals prior to 1-3-1986 was based on the Customs Cooperation Councils Nomenclature (CCCN) popularly known as Brusseles Tariff Nomenclature (BTN). With regard to these ferrous and non-ferrous metals no change was effected when the new Tariff came into operation w.e.f. 28-2-1986. It was only w.e.f. 1-3-1988 that the metal tariff was aligned with the Harmonised commodity description and Coding System of Nomenclature (HSN). Therefore, classification under HSN was not material for classifying the Iron and Steel prior to 1-3-1988. The help can be taken only from the B.T.N. for the period 1-3-1988 although the ferrous and non-ferrous Tariff was not completely based on BTN.

6. The respondents had sought to classify the storage tanks and vessels of base metals manufactured by them under Chapter 73 of the Tariff as articles of Iron or Steel. Under Heading No. 73 .08 other articles of Iron or Steel were classifiable.

7. Under Heading No. 73.22 of the BTN, Reservoirs, tanks, vats and similar containers for any material (other than compressed or liquified gas), of Iron or Steel of a capacity exceeding 300 litres whether or not lined or heat insulated but not filled with mechanical or thermal equipment, were covered. These goods were referred to as `containers’. It was however explained that such containers differed from the packing and transport containers as they were normally installed as fixtures for storage or for manufacturing used eg. in factories, chemical works, dye works, gas works, breweries, distillers and refineries and to a smaller extent in houses, shops, etc. It was further explained that under this Heading containers for any material other than compressed or liquified gas irrespective of their capacity or use were covered. It was also stated in the BTN Explanatory Notes that the containers which had simply been fitted with tapes, valves, level gauges, safety valves, mano-meters remained within the Heading No. 73.22.

8. It is thus, seen that before 1-3-1988 the goods in question were classifiable under BTN Heading No. 73.22. In the Central Excise Tariff, which was patterened on BTN, there was no corresponding Heading No. 73.22. For the containers of base metal, separate Heading No. 83.12 was carved out. Under BTN, there was no Heading 83.12. In other words, for all the containers of base metal a specific Heading No. 83.12 was introduced under the Central Excise Tariff, which was in force prior to 1-3-1988. The containers of base metal were divided into two parts (i) containers ordinarily intended for packaging of goods for sale and (2) other i.e. the containers, which were not ordinarily intended for packaging of goods for sale. The description and use of the goods in question makes it clear that while they were containers they were not intended for packaging of goods for sale. Under the scheme of Central Excise Tariff, the containers ordinarily intended for packaging of goods for sale, of Aluminium were classifiable under sub-heading No. 8312.11; of all base metal other than aluminium if produced with the aid of power were classifiable under sub-heading No. 8312.12 and the containers ordinarily intended for packaging of goods for sale which were neither classifiable under sub-heading No. 8312.11 or sub-heading No. 8312.12 were classifiable under sub-heading No. 8312.19. The containers of base metal, which were neither covered by sub-heading No. [8312.11] or 8312.12 or 8312.19 were classifiable under sub-heading No. 8312.90. For classification under sub-heading No. 8312.90, there was no condition that the containers should be ordinarily intended for packaging of goods for sale. This was the condition applicable for only sub-heading Nos. 8312.11, 8312.12 and 8312.19.

9. The ld. Collector of Central Excise (Appeals) had observed that as the goods were not containers ordinarily intended for packaging of goods for sale, they were not classifiable under Heading No. 8312.90. The view taken by the ld. Collector of Central Excise (Appeals) is not correct as the condition relating to the intended use for packaging of goods for sale was not applicable to the containers classifiable under sub-heading No. 8312.90. The respondents in the written submissions before the Asstt. Collector of Central Excise have referred to HSN heading No. 7308.90 of the HSN while stating that storage tanks and vessels of Iron were classified under the heading - Reservoirs, tanks, vats and similar containers for any material under Heading No. 73.09 of the HSN. Thus, they themselves have agreed that their products were containers. As we have discussed above, the HSN was not relevant for classification of the goods in question before 1-3-1988 and that the goods of the respondents were covered by the Heading No. 73.22 of the BTN and the Central Excise Tariff for the containers, there was only the applicable Heading No. 83.12.

10. Thus, the view taken by the ld. Collector of Central Excise (Appeals), Madras that the goods were classifiable under heading No. 7308.90 was not correct. We consider that the view taken by the Asstt. Collector that the goods manufactured by the assessee were rightly classifiable under Heading No. 8312.90 was correct.

11. Taking all the relevant considerations into account, we allow the appeal of the Revenue. Ordered accordingly.

Equivalent 1997 (93) ELT 62 (Tribunal)