Em Ess Enterprises vs Collector of Customs, New Delhi>1997(11)LCX0009

1997(11)LCX0009

IN THE CEGAT, COURT NO. II, NEW DELHI

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

EM ESS ENTERPRISES

Versus

COLLECTOR OF CUSTOMS, NEW DELHI

Final Order Nos. C/2963-2964/97-B, dated 27-11-1997 in Appeal Nos. C/138/93-B2 & C/728/93-B2

Cases Quoted

Collector v. Knic Knac Agencies — Appeal No. C/2854/91-B2 — Followed............ [Paras 3, 4, 10]

Collector v. Knic Knac Agencies — 1997(09)LCX0142 Eq 1998 (099) ELT 0339 (Tribunal) — Followed.......... [Paras 4, 10]

Collector v. Wood Craft Products Ltd. — 1995(03)LCX0070 Eq 1995 (077) ELT 0023 (S.C.) — Followed................ [Para 7]

Advocated By : Shri R. Swaminathan, Consultant, for the Appellant.

Shri S.N. Ojha, JDR, for the Respondent.

[Order per : Lajja Ram, Member (T)]. - These are two appeals, one filed by M/s. Em Ess Enterprises, New Delhi, and the other by M/s. Jay Cee Enterprises Pvt. Ltd., being aggrieved with two different orders-in-appeals both passed by the Collector of Customs (Appeals), New Delhi. As in both the appeals common issue of classification of the Electric Steam Iron is involved, they were heard together and are being disposed of by this common order.

2. Shri R. Swaminathan, Consultant, appeared for both appellants. Shri S.N. Ojha, JDR, represented the Respondents/Revenue.

3. Shri R. Swaminathan, Consultant, referred to the product literature and contended that the goods imported were correctly classifiable under sub-heading No. 8451.30 of the Customs Tariff as against the sub-heading No. 8516.40 under which the Revenue had classified the same. He referred to the price and the attachments to substantiate his claim that the goods were machines, were for industrial use, were not of domestic type and that the classification under sub-heading 8516.40 was not proper. They had claimed the assessment under sub-heading No. 8451.30 which was not agreed to by the Customs and assessment order was passed which they have challenged before the Collector of Customs (Appeals), New Delhi. It was his submission that the facts of the case were different than the facts in the case of CC, Bangalore v. M/s. Knic Knac Agencies, in Appeal No. C/2854/91-B2.

4. In reply, Shri S.N. Ojha, JDR, submitted that the product description as in the invoice and as in the catalogue show that the goods were not classifiable under Chapter Heading No. 84. He further submitted that classification under Heading No. 8516.40 was not restricted to the goods for domestic use only and referred to the HSN Notes. He submitted that the matter was entirely covered by the Tribunal’s decision in the case of CC, Bangalore v. M/s. Knic Knac Agencies and that the Tribunal after referring to the relevant tariff and the HSN Notes/in Final Order No. C/1965/97-B2, dated 16-9-1997 [1997(09)LCX0142 Eq 1998 (099) ELT 0339 (T)] had held that the goods were classifiable under Chapter 85 of the Tariff and that the benefit of Notification No. 16/85-Cus, dated 1-2-1985 was not available.

5. We have carefully considered the matter. In the case of M/s. Em Ess Enterprises the goods were described as ‘Osaka’ Model : B-8NT, Electric Steam Iron, Teflon Coated Sole. The catalogue indicates that it is a boiler type electric steam iron (equipped with an electronic thermostat). It is mentioned that steam iron was easy to use owing to the lower height. The Model BV-8NT was of a size of 136mm x 205mm and weight 2.5 kg.

6. In the case of Jay Cee Enterprises, the goods were described in the invoice as Hashima Steam Iron HI-550P. From the record it is seen that it is a industrial steam iron (with water tank) and its dimensions were 15 cm x 11 cm weighing 2.4 kgs. The water tank was of only 3 litres.

7. The appellants have claimed assessment under sub-heading 8451.30. Heading No. 84.51 covered Machinery among others for ironing, pressing (including fusing presses). Sub-heading No. 8451.30 covers ironing machines and presses (including fusing presses). It has been explained in the explanatory notes that this heading covers a wide variety of machines which are used for the washing, bleaching, wringing, cleaning, ironing, dyeing, drying or the like of textile yarns, fabrics or made up textile articles. It is clear that the machinery classifiable under Heading No. 84.51 are such machinery which are used in textile industry for the purposes mentioned therein with regard to textile yarns, fabrics made up articles. It has been specifically mentioned in the Explanatory Notes that to fall in the Heading, the apparatus must have such mechanical features and must be clearly intended for treating textiles. While explaining the scope of the machinery for ironing or pressing, it has been further explained that the group includes ironing machines and steam presses for pressing garments but excludes smoothing or ironing machines in the facts and circumstances of these cases. We find that the Supreme Court in the case of Collector of Central Excise, Shillong v. Wood Craft Products Ltd., 1995(03)LCX0070 Eq 1995 (077) ELT 0023 (S.C.) = 1995 (057) ECR 0417 (S.C.), had held that any dispute relating to tariff classification must as far as possible be resolved with reference to the nomenclature by the HSN unless there be an express different intention indicated by the Central Excise Tariff Act, 1985 itself. Para 18 from that judgment is extracted below :

18. We are of the view that the Tribunal as well as the High Court fell into the error of overlooking the fact that the structure of the Central Excise Tariff is based on the internationally accepted nomenclature found in the HSN and, therefore, any dispute relating to tariff classification must, as far as possible, be resolved with reference to the nomenclature indicated by the HSN unless there be an express different intention indicated by the Central Excise Tariff Act, 1985 itself. The definition of a term in the ISI Glossary, which has a different purpose, cannot, in case of a conflict, override the clear indication of the meaning of an identical expression in the same context in the HSN. In the HSN, block board is included within the meaning of the expression “similar laminated wood” in the same context of classification of block board. Since the Central Excise Tariff Act, 1985 is enacted on the basis and pattern of the HSN, the same expression used in the Act must, as far as practicable, be construed to have the meaning which is expressly given to it in the HSN when there is no indication in the Indian tariff of a different intention.

The Revenue had classified the goods in question under sub-heading No. 8516.40 of the Tariff which covers electric smoothing irons. Heading No. 85.16 covers a number of electrical equipments and all of them are not necessarily of the kind used for domestic purposes. Headng No. 85.16 covers such apparatus as electric space heating apparatus and soil heating apparatus, electric heating resistors etc. A number of equipments and apparatus had been specifically named in the Heading No. 85.16 and for the other electro-thermic appliances only there is a reference that they should be of a kind used for domestic purposes. The learned JDR appearing for the Revenue had submitted that the smoothing irons even for industrial purposes will be covered under these heading and that in the scheme of the Tariff, the Chapter Heading 85 will have precedence over Heading No. 84. We find that the scope of the electric smoothing irons had been described in the Explanatory Notes as under :

“This group covers smoothing irons of all kinds, whether for domestic use or for tailors, dressmakers etc., including cordless irons. These cordless irons consist of an iron incorporating a heating element and a stand which can be connected to the mains. The iron makes contact with the current only when placed in this stand. This group also includes electric steam smoothing irons whether they incorporate a water container or are designed to be connected to a steam pipe.”

9. The learned Consultant had submitted that the reference is only for use by tailors, dressmakers etc. and as the goods were for industrial purposes, they were not covered by the scope of electric smoothing irons. We find that the scope of the Tariff Heading No. 85.16 is not restricted to the goods for domestic purposes and that the goods for industrial use are not excluded from the purview of this Heading. The electro-mechanical domestic appliances with self-contained electric motor are specifically referred to in Heading No. 85.09. In Heading No. 85.16, as we have already referred to above, there are apparatus for industrial purposes also included as is clear from the inclusion of such apparatus as electric space heating apparatus, electric soil heating apparatus, storage heating rediators etc. We have already referred to above about the applicability of the HSN Notes, according to which the goods were correctly classifiable under Chapter Heading No. 85.16 of the Tariff.

10. The learned JDR had also referred to the Tribunal’s decision in the case of CC, Bangalore v. M/s. Knic Knac Agencies, in Appeal No. C/2854/91-B2. The Tribunal in Final Order No. C/1965/97-B2, dated 16-9-1997 [1997(09)LCX0142 Eq 1998 (099) ELT 0339 (T)] had referred to the Scope of the Chapter 84 and Chapter 85 of the Tariff and had held that the ironing machines and presses including fusing presses classifiable under sub-heading No. 8451.30 were those machines which were used by the textile industry. They were basically machines used for ironing of fabrics and made up textile articles. It had also been observed that the scope of sub-heading No. 85.16 was wide and it also covered the goods for ironing the readymade garments produced by the tailors and the dressmakers. Paras 6, 7, 8 and 9 from that decision are extracted below :

“6. Chapter 84 covers the mechanical appliances which were not more specifically covered by Chapter 85. The mechanical appliances specially covered by Chapter 85 were, in other words, not to be classifiable under Chapter 84. Thus, Chapter 85 will have precedence over Chapter 84. In general, Chapter 84 covers machinery and mechanical apparatus, and Chapter 85 covers electrical goods; however, machinery and apparatus of a kind covered by Chapter 84 remained in that Chapter even if electric. Electrically heated presses incorporating electrical heating elements remained classifiable under Chapter 84. Heading No. 84.51 had a reference to the field of industry in which they are used. The expression used in Heading No. 84.51 is the machinery for ironing. The emphasis is on the expression ‘Machinery’, ‘Ironing Machines’. To fall in Heading No. 84.51 the apparatus must have mechanical features and must be clearly intended for treating textiles. The Heading covers a wide variety of machines including those which are used for the textile yarns, fabrics or made up textile article. To fall in this Heading the apparatus must have mechanical features and must be clearly intended for treating textiles. Ironing machines and steam presses for pressing garments including fusing presses were included in sub-heading No. 8451.30; however, smoothing or ironing machines of the calender type whether or not for domestic use were classifiable under Heading No. 84.20 which covered calendering or other rolling machines other than for metals or glass.

7. Electric smoothing irons covered smoothing irons of all kind whether for domestic use or for tailors, dressmakers etc. including cordless irons. The electric steam smoothing irons whether they incorporated a water container or were designed to be connected to a steam pipe were also covered in the expression ‘Electric Smoothing Irons’. Smoothing refers to the surface, crease, to press flat. According to Webster’s Ninth New Collegiate Dictionary, Private Library Edition (page 639), Ironing is the action or process of smoothing or pressing with or as if with a heated iron. Iron is a household device usually with a flat metal base that is heated to smooth, finish or press (as cloth) - to smooth or press cloth or clothing with a heated iron.

8. The above discussion provides that the ironing machines and presses including fusing presses classifiable under sub-heading No. 8451.30 are those machines which are used by the textile industry. They are basically machines used for ironing of fabrics and made up textile articles. The goods imported were electric steam iron for all applications. They were equipped with cork handle for ease of use. They were more an iron than an ironing machine or machinery for ironing. They were more appropriately classifiable under sub-heading No. 85.16 as electric smoothing irons.

9. Notification No. 16/85-Cus., dated 1-2-1985 provided concessional rate of customs duty to certain specified goods falling within Chapter 84 of the Customs Tariff when imported for use in garment and or hosiery industry. Against serial No. 42 of the Table annexed to that notification “presses for shirts, trousers and jackets” were covered for the concessional rate of duty. As the goods in question were classifiable under Chapter 85, and as the goods classifiable under Chapter 85 were not covered by the scheme of exemption under Notification No. 16/85-Cus., dated 1-2-1985, we consider that the benefit of Notification No. 16/85-Cus. was not available to the goods in question.

11. In view of the above discussion, we do not find any merit in both these appeals and the same are rejected.

Equivalent 2001 (137) ELT 1255 (Tri. - Del.)