1997(03)LCX0120
IN THE CEGAT, COURT NO. II, NEW DELHI
S/Shri S.L. Peeran, Member (J) and Shiben K. Dhar, Member (T)
COLLECTOR OF CUS., BOMBAY
Versus
GUJARAT VACUUM COATERS PVT. LTD.
Final Order No. C/684/97-B2, dated 20-3-1997 in Appeal No. C/1675/91-B2
Cases Quoted
Atul Glass Industries Ltd. v. Collector — 1986(07)LCX0018 Eq 1986 (025) ELT 0473 (S.C.) — Relied on [Para 4]
Collector v. Enfield India Ltd. — 1996(09)LCX0124 Eq 1996 (088) ELT 0693 (Tribunal) — Relied on [Para 6]
Advocated By : Shri K.K. Jha, SDR, for the Appellant.
Shri M.J. Nambiar, Consultant, for the Respondent.
[Order per : Shiben K. Dhar, Member (T)]. - This Revenue Appeal is directed against Order-in-Appeal dated 14-1-1991. The Respondents imported aluminium tubes cut to specific size and shape with mirror finish on the surface and had grooves on the edges. They claimed assessment under CTH 7608.10 as aluminium tubes. The Assistant Collector held that these were parts of photocopier machine assessable under CTH 9009.90. Collector (Appeals), however, held that the goods have not attained the essential character of finished goods, and therefore, held that the impugned goods were only aluminium tubes.
2. We have heard both sides. Order-in-Original indicates that the impugned goods after importation required to be subjected to processing like finish turning for roughing the outer surface of the aluminium tube to ensure uniform adhesion of the coating, coating of selenium under ultra-high vacuum conditions by vacuum evaporation process, fitting of the end-aluminium flanges. There is no dispute on these findings from Revenue. It is the contention of the Respondents that the essential character of selenium drum is acquired only after selenium coating and without that aluminium tube remains only an aluminium tube and not part of a photocopying machine. The imported goods, in the form in which they have been imported, do not have photo receptor character because they are not coated with selenium. The selenium coating imparts to the aluminium tubes photo receptor characteristics whereby it becomes photo receptor drum for use in the photocopying machinery. Collector (Appeals) has quoted the following material from Xeography and Related Processes by J.H. Dessauer and H.E. Clark :
“of great significance was the discovery by Bixby that amorphous or vitreous selenium layers prepared for example, by evaporating pure selenium onto an aluminium or brass plate, in a high vacuum, were photoconductive insulators with much greater light sensitivity than the sulfur and anthracene layers previously used”. It further mentions, “Although the grey metallic form of selenium had long been known as a photo conductor no one had previously reported photo conductivity in the insulating form. This property was independently noted by Weimer at the Radio Corporation of America Research Laboratories at about the same period.”
3. Interpretation Rule 2(a) reads :
“2(a) Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as presented, the incomplete or unfinished article has essential character of the complete or finished article. It shall also be taken to include a reference to that article complete or finished (or falling to be classified as complete or finished by virtue of this rule), presented unassembled or disassembled.”
4. Considering the processes to which the tubes are subjected for a particular function, we are of the view that these could not be considered at that stage to have acquired the essential character of finished product. In case of Atul Glass Industries Ltd. and Others v. C.C.E. - 1986(07)LCX0018 Eq 1986 (025) ELT 0473 (S.C.) - the Hon’ble Apex Court placed considerable emphasis on the process to which a product is subjected in order to determine what its exact identity is. The Apex Court for instance observed :
“7. A broad description of the process through which a glass sheet passes has been detailed earlier. It indicates clearly to our mind that the original glass sheet undergoes a complete transformation when it emerges as a glass mirror. What was a piece of glass simpliciter has now become a commercial product with a reflecting surface. Into the process of transformation have gone successive stages of processing with the aid of chemicals such as stannous chloride, silver nitrate and copper coating besides an entire range of physical processes involving polishing, washing, coating, drying, varnishing, evaporation and cooling. The evolved product is completely different from the original glass sheet. What was a glass piece in its basic character has no longer remained so. It has been reduced to a mere medium. That is clear if regard is had to the fundamental function and qualities of a glass mirror. The power to reflect an image is a power derived not from the glass piece but principally from the silvering and other processes applied to the glass medium. If any part of the coating is scratched and removed, that particular area of the glass mirror will cease to be glass mirror. That simple test demonstrates the major importance attributable to the chemical deposit and coating which constitute a material component of a glass mirror.”
5. It is clear to us that prior to the selenium coating which imparts to the aluminium tubes its essential character to function as a part of photocopying machine, the aluminium tubes were just aluminium tubes only and nothing more.
6. This Bench in case of C.C., Madras v. M/s. Enfield India Ltd. - 1996(09)LCX0124 Eq 1996 (088) ELT 0693 (Tribunal) - had occasion to examine the classification forging for motor cycle parts. This Tribunal held that considering the processes to which these forgings had to be subjected to subsequent to importation, could not be considered as unfinished articles having essential character of the complete article, and therefore, they were classified under Heading 7608/16 of the erstwhile Customs Tariff and not under Heading 84.06 ibid. The Tribunal also discussed the previous cases like Collector v. Bajaj Auto Ltd. but arrived at a decision that articles do not have essential character of finished articles.
7. As discussed hereinbefore these aluminium tubes cannot, in the form in which they are imported, be considered as an identifiable part of a photocopying machinery because they have not attained the essential character which is attained only after selenium coating.
8. In view of this, we reject the Revenue Appeal and uphold the impugned order.
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Equivalent 1998 (97) ELT 143 (Tribunal)
Equivalent 1997 (020) RLT 0501 (CEGAT-SB)