1998(08)LCX0158

IN THE CEGAT, COURT NO. II, NEW DELHI

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

DAWAR FOOTWEAR INDS.

Versus

COMMISSIONER OF CUSTOMS, NEW DELHI

Final Order No. 648/98-B2, dated 13-8-1998 in Appeal No. C/418/97-B2

Advocated By : Shri D.C. Saxena, Advocate, for the Appellant.

Shri R.S. Sangia, JDR, for the Respondents.

[Order per : P.C. Jain, Member (T)]. - Briefly stated, facts of the case are as follows :-

The appellants herein imported ironing and conditioning machine Italian make Model ERC 187 from ltaly. A question has arisen about its classification whether it falls under Tariff Heading 84.18 or under Tariff Heading 84.53. Tariff Heading 84.18 pertains to “Refrigerator, freezer and other refrigerating, freezing equipment.....”. On the other hand 84.53 relates, inter alia, to “Machinery for making or repairing footwear or other articles of hides, skins or leather, other than sewing machines”.

2. It has come on record that this machine brings down the temperature to -20°C and in the process of manufacture of shoes, it conditions the shoes so that the shoes are taken off shoe-lasts and the shoe does not get deformed. This function is explained at page 70 of the appeal papers in the following words :-

“This machine is commonly known as Ironing and Conditioning Machine because when shoes are passed through this machine the stresses of leather are reduced. Also counters, toe puffs become hard and firm as if we have ironed the shoes. Even in the dictionary the meaning of Iron is to make something firm. Since the machine works very low temperature obviously it means that there is a conditioning going on, which means that the shoe can resist very low temperature and will not deform its shape.”

3. In view of its cooling effect that the machine brings about, the Revenue has classified the machine under Tariff Heading 84.18 whereas the contention of the appellant is it is a shoe making machinery and should therefore be classified under Tariff Heading 84.53 being a more specific item.

4. Learned Advocate Shri D.C. Saxena, apart from the functions of the machine, has shown the catalogue and has also relied upon opinions of Ministry of Commerce, Directorate of Foreign Trade, Council of Leather Export Footwear, Design and Development. All those organisations have stated that the machine is used for shoe making and is not a refrigerator. The machine provides a blast of cold air and cannot freeze any material. On the basis of the aforesaid material, the learned Advocate submits that its proper classification is under the Customs Tariff Heading 84.53 and consequently there is no restriction on its imports for the licensing purposes as well.

5. Learned JDR Shri R.S. Sangia draws attention to the fact that the machine is like a refrigerating equipment which normally contains a compressor, cooling coil, condenser and fan & motor. It also brings down the temperature of -20°C. Therefore, he submits that the lower authorities have correctly classified the goods. He also draws our attention at this stage to ITC (HS) classification of export and import items for the period 1997-2002 which gives the exim code to the product as 84186904 pertaining to refrigeration equipment/device specially used in leather industries for manufacturing of leather items/articles etc. In view of this classification submits the learned JDR the lower authorities have rightly classified the product under Tariff Heading 84.18 it is restricted on importation as well.

6. As against the above argument learned Advocate has drawn our attention to the plea appeal taken by the appellant before the lower authorities that the machine is allowed under OGL for import at a concessional rate of customs duty under Serial No. 117 list 5 for leather industry against ITC (HS) classification bearing No. 84532000 pertaining to machinery for making or repairing footwear. This plea, he submits, has not been taken into account by the lower appellate authority.

7. We have carefully considered the pleas advanced from both sides. While we agree with the learned JDR that the machine does bring down the temperature to -20°C and it may be called a refrigerating equipment but it is also clear from the various certificates produced by the appellant as also from the catalogue, extracts from which have already been set out as above, that this machine is used for ironing and conditioning the shoes. It is a machinery used in manufacture of shoes. Therefore in our view Tariff Heading 84.53 is more specific and the Tariff Heading 84.18 will not be applicable to the instant machine. Tariff Heading 84.18 would be applicable to general purpose refrigerating equipments. Further, the authorities below have not rebutted the plea of the appellant that it falls under Sl. No. 117 of list 5. The appellants would also be entitled to the benefit of OGL. Consequently appeal is allowed with resultant relief to the appellant, after we set aside the impugned order.

Equivalent 1999 (113) ELT 549 (Tribunal)