Mega Overseas Pvt. Ltd. vs Collector of Customs, Bombay>1986(10)LCX0027

1986(10)LCX0027

BEFORE THE CEGAT, SPECIAL BENCH ‘B2’, NEW DELHI

S/Shri G.P. Aggarwal, Member (J) and P.C. Jain, Member (T)

MEGA OVERSEAS (P) LTD.

Versus

COLLECTOR OF CUSTOMS, BOMBAY

Order No. 999/86-B2, dated 20-10-1986

Advocated By : Shri J. Banerjee, Advocate, for the Appellants.

Shri J. Gopi Nath, SDR, for the Respondent.

[Order per : P.C. Jain, Member (T)]. - This is an appeal originally filed as a Revision application and now transferred to this Tribunal under Section 131-B of the Customs Act, 1962.

2. Short question involved in this appeal is whether the Electrolytic Condensors imported by the appellants are classifiable under Tariff Heading 85.15 of the CTA 1975 or under Tariff Heading 85.18/27(2) of CTA. The lower authorities have assessed them under Tariff Heading 85.18/27(2) on the ground that these are nothing but Electrical Capacitators which are specifically stated in the said Tariff Heading. The appellants, on the other hand, contend that these are parts of Radio Reception apparatus classified under Tariff Heading 85.15 and as such they are reliable to the benefit of Notification 341/76-Cus., dated 2-8-1976 since the goods have been imported from Yugoslavia. In support of their contentions, the learned Advocate for the appellants stressed that Electrolytic Capacitators are different in form and design and function from Electrical Capacitators which are mentioned in Tariff Heading 85.15(2). He has pointed out that there is no electrolyte in electrical Capacitators. Secondly, Electrolytic Capacitators are of Polar Type having fixed polarity while electrical capacitators are non-polar type. The distinction between Electrolytic Capacitators and Electrical Capacitators is therefore, quite obvious. He also states that Electrolytic Capacitators are used with D.C. Circuits only suitable for use in Television Reception Apparatus and other electronic equipments. In Electrolytic Capacitators, there are number of contacts and by way of example, he showed an Electrolytic Capacitator with 4 different contacts whereas he claimed, the Electrical Capacitator has only two contacts. Accordingly, he stated that the goods under consideration would not be covered under Tariff Heading 85.18/27(2).

3.On the other hand, the learned SDR appeared for the Revenue, states that the Electrical Capacitators specified in Heading 85.18/27(2) will cover all types of Electrical Capacitators including Electrolytic Capacitators. He drew support for his plea from Explanatory Notes of CCCN under Heading 85.18/27(2) relating to Electrical Capacitators fixed or variable at page 1443 (Vol. III). He drew specific attention to the following two paras :-

“They (Electrical Capacitators) are used for various purposes in many branches of the electrical industry (e.g. to improve the power factor of A.C. Circuits; to protect electrical contacts from the effects of arcing; for storing and releasing given quantities of electricity; in oscillating circuits; in frequency filters; and very largely in the radio, television and telephone industries).

There characteristics (shape, size, capacitance, nature of dielectric, etc.) vary according to their intended use. The heading, however, covers all capacitors whatever their intended use."

He also drew attention to the fact given specifically on the very page of the Explanatory Notes that Electrolytic Capacitator is nothing, but a type of fixed Capacitator. The learned SDR also drew support from the meaning of Capacitators (Electrical) given in Mcgraw Hill’s Dictionary of ‘Scientific and Technical Terms’.

As a next point, the learned SDR stated that in terms of the Determination of Origin of the U.A.R. and Yugoslavia Rules, a claim has to be made by the Importer at the time of Importation; there is no indication that such a claim was made at all by the Importer.

4. Replying, learned Advocate for the appellants stated that the country of origin of goods is not in doubt. That is apparent from the Invoice of the goods. In any case, this can no longer be open to question inasmuch as the claim of the appellants have been rejected by the lower authorities on the ground that Electrical Capacitators are the same as Electrolytic Capacitators. The claim has not been rejected on the ground of not making the claim at the time of importation regarding the country of origin.

5. We have carefully considered the pleas advanced on both sides. Without going into the second plea regarding the country of origin made by the learned SDR, we are inclined to agree with him on his first plea that Electrical Capacitators mentioned in Tariff Heading 85.18/27(2) would cover Electrolytic Condensors as well. Reliance placed by the learned SDR on the Explanatory Notes to the CCCN is well founded. It is by now well settled position that for the purpose of determining the scope of entry in the Customs Tariff Act, 1975. Explanatory Notes to the CCCN provide a valuable guide since entries in the CTA closely follow the CCCN. Note 2 of Section XVI further provides that goods described, inter alia, in Chapter 85 are to be classified according to the description mentioned in the various Headings in that Chapter. Electrical Capacitators being specifically mentioned in Heading 85.18/27(2) and Electrolytic Capacitator being only a type of Electrical Capacitator are positively covered by the Tariff as held by the lower authorities. The distinction sought to be created by the appellants is of no significance so far as the classification of the goods is concerned. In view of this finding, the question of benefit of Notification 341/76-Cus., dated 2-8-1976 for import of goods from Yugoslavia does not arise in this case. Since according to the Notification, the goods in order to enjoy the benefit of concessional rate of duty must fall under Tariff Heading 85.15.

6. Accordingly, the appeal is rejected.

Equivalent 1987 (28) ELT 132 (Tribunal)