2002(03)LCX0052

IN THE CEGAT, COURT NO. II, NEW DELHI

S/Shri P.S. Bajaj, Member (J) and K.K. Bhatia, Member (T)

SUPER CASSETTES INDUSTRIES LTD.

Versus

COMMISSIONER OF CUS., NHAVA SHEVA

Final Order No. 134/2002-B, dated 27-3-2002 in Appeal No. C/432/99-B

Cases Quoted

Hariram Govindram v. Collector — 1997(06)LCX0115 Eq 1997 (094) ELT 0574 (Tribunal) — Relied on.......... [Paras 4, 6]

Patel Plastic v. U.O.I. — 1991(09)LCX0030 Eq 1992 (059) ELT 0247 (Guj.) — Referred.......................................... [Para 4]

DEPARTMENTAL CLARIFICATION CITED

C.B.E. & C. Circular No. 33/9/94-CX., dated 29-7-1994 — 1994 (073) ELT (T-25) ... [Paras 3, 5]

Advocated By :   Shri R. Parthasarathy, Advocate, for the Appellant.

Shri Ashok Kumar, JDR, for the Respondent.

[Order per : K.K. Bhatia, Member (T)]. - The brief facts in this case are that the appellants filed a Bill of Entry No. 1988, dt. 17-8-98 at the Nhava Sheva Port for the clearance of their imported consignment of spring pads and corrugated liners. Both of these items are components of Audio Cassettes. The appellants classified these items under Customs Tariff heading 7416.00 and 3920.62 respectively - as per the material of which the imported items are made- for payment of duty. The Asstt. Commissioner of Customs, however, classified the imported items under heading 8423.12 as parts of Audio Cassettes. The Asstt. Commissioner in his order observed that these goods are identifiable parts of audio cassettes only. He observed that as per Section Note 2(b) read with Note 5 to Section XVI of Customs Tariff, parts of goods falling under Chapters 84 or 85 if suitable for use solely or principally with particular type of goods shall be classified with that type of goods only. Hence, it is observed that even though parts of cassettes are not specifically mentioned in the CTH 8523, the same by virtue of these provisions are classifiable under heading 8523.

2. The party filed an appeal but the same stood rejected by the Order dated 3-6-99 of Commissioner of Customs (Appeals), Mumbai.

3. This appeal is against the impugned order of Commissioner of Customs (Appeals). We have heard Shri R. Parthasarathy, Advocate for the appellants and Shri Ashok Kumar, JDR for the respondents. The ld. Counsel for the appellants while contesting the findings of the lower authorities for classifying the imported goods in terms of the provisions of Section Note 2(b) read with note 5 to Section XVI of the Customs Tariff submitted that this note inter alia reads that parts of machines are to be classified according to the rules viz., that parts which are goods included in any of the heading of Chapter 84 or 85 are in all cases to be classified in their respective headings and that other parts, if suitable for use solely with a particular kind of machine or with a number of machines of the same sub-heading are to be classified with the machines of that kind. It is contended that from the Heading of Chapter Note 2, it is clear that this section note is applicable to parts of machines only. It is stated that ‘audio cassettes’ is not a machine as per the definition given in Section Note 5 which defines the expression machine meaning - any machine, machinery, plant, equipment, apparatus or appliances cited in the Headings of Chapters 84 or 85. It is contended that the item audio cassettes does not fall under any of the category of the machines specified under the section note. It is further contended that the Board vide their Circular Order No. 33/9/94-CX., dt. 29-7-94 reported in 1994 (073) ELT (T-25) have directed that the plastic components of audio cassettes viz., cassettes Housing/Casings, Hubs, Rollers & Stoppers shall be classifiable under Heading 39.26 of the Tariff and that once it is accepted that plastic components of audio cassettes are to be classified as per the material of which these are made, there is no reason why the same principle should not be made applicable to the other components under import and they should also be classified in the Tariff as per the material of which these are made of as under :-

4. The ld. Counsel in support of his contention has relied on the following decisions :

(a)     M/s. Patel Plastic v. Union of India - 1991(09)LCX0030 Eq 1992 (059) ELT 0247 (Guj.), and

(b)     Hariram Govindram v. C.C.E., Bombay - 1997(06)LCX0115 Eq 1997 (094) ELT 0574 (T).

5. We have considered the above submissions. The ld. Counsel for the appellants has placed before us the Board’s Instructions dated 29-7-1994 in which, it is observed that the Central Excise Officers of different Collectorates, have been classifying the components of the audio cassettes under sub-heading 8523/8524 or under Chapter 39 of the Tariff and on consideration of the representation of the Trade, it is directed as follows :

“2. The Central Board of Excise & Customs (henceforth referred to as Board) has examined the classification of Cassettes housings/casings, hubs, rollers and stoppers, used in the cassettes falling under Chapter 85 of the Tariff. Keeping in view the nature of the items, judicial pronouncements etc. now therefore in exercise of the powers conferred under Section 37B of the Central Excises & Salt Act, 1944 (henceforth referred to as the Act), and for the purpose of ensuring uniformity in the classification of the goods in question, Board has ordered that cassettes housing/casings, hubs, rollers and stoppers shall henceforth be classifiable under Heading No. 39.26 of the Tariff”.

6. It would be observed from the above instructions of the Board that the components of the audio cassettes instead of being classified under Heading 8523 as unrecorded audio cassettes (those including semi-finished) by following Section Note 2(b) and Note 5 to Section XVI, these have been advised to be classified under Heading No. 3926 - other articles of plastics. We therefore find force in the contention of the appellants that once it is accepted that plastic components of audio cassettes are to be classified as per the material of which these are made up of, there is no reason why the same principle should not be made applicable to other components also. We find that the same line of reasoning is adopted in the Tribunal decision in the case of Hariram Govindram referred to supra cited before us by the appellants, in which, it is held that the classification of the plastic moulded C.O. cassettes without magnetic tape is correctly classifiable under sub-heading 3922.90 as other articles of plastic. We are of the opinion that any other view, in respect of the classification of the items under consideration, would go against the very essence of the Board’s afore-mentioned advice which is issued for the purpose of ensuring uniformity in classification of the goods. We therefore, agree with the contention of the appellants that the corrugated liner and spring pad are rightly classifiable under CTH 3920.62 and 7416.00 respectively. Consequently, the appeal is allowed by setting aside the impugned order of the Commissioner (Appeals).

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Equivalent 2002 (143) ELT 322 (Tri. - Del.)

Equivalent 2002 (050) RLT 0389