2006(05)LCX0215
In the Customs, Excise & Service Tax Appellate Tribunal, New Delhi
Shri S.S. Kang, Vice President, Shri C.N.B. Nair, Member (Technical)
Airport Authority of India
Versus
Commissioner of Customs, Mumbai
Final Order No. 222/2006-Cus. dt. 9.5.2006 certified on 31.7.2006 in Appeal No. C/843/2004
Cases Quoted -
Tata Iron & Steel Co. Ltd. 1997(04)LCX0040 Eq 1997 (094) ELT 0138 (SC) - Referred[Para 6]
Advocated By -
S/Shri Shekhar Vyas, L.P. Asthana & P.C. Jain, : S/Shri D.N. Mehta, Adv. and A.L. Mehta, Consultant for Appellant
S/Shri Amit Jain and Kumar Santosh, DRs for Respondent
Per CN.B. Nair :
The dispute in this appeal of M/s. Airport Authority of India, Mumbai is the correct classification of aerobridges imported by it at Mumbai in 1997. The Airport Authority claimed their classification under Chapter Heading 8428 of Customs Tariff. The Customs Authorities disagreed and classified the item under Heading 7308. Thus, the subject matter of this appeal is as to which of these classifications is correct.
2.We may note the competing headings:
Revenue's classification:
"7308 Structures (excluding prefabricated buildings of Heading No. 94.06) and parts of structures (for example, bridges and bridge-Section, lock gates, towers, lattice masts, roofs roofing frameworks, doors and windows and their frames and thresholds pillars and columns), of iron or steel, plates, rods, angles, shapes, sections, tubes and the like prepared for use in structures of iron or steel.
730810 Bridges and bridge-sections."
Classification claimed by Airport Authority:
"8428 Other lifting, handling, loading or unloading machinery (for example, lifts, escalators, conveyors, teleferics)
842890 Other machinery."
3.The finding of the Commissioner (Appeals) is that 'aerobridge' functions like a bridge between aircraft and airport terminal and therefore, is classifiable under Heading 7308.10 ("bridges and bridge-section"). The Commissioner has also invoked Rule 3 of the interpretation of the first schedule (import-Tariff) to the Customs Tariff Act, 1975 to hold that the classification as "bridges and bridge-section" meets the most specific description for the item in question (while Heading 8428 is a general description). This is in answer to the contention that aerobridge is a composite article and should be classified under the heading which gives the most specific description.
4.The contentions of the appellant are that aerobridge is a sophisticated machine comprising electrical and electronic parts and working on hydraulic, electrical and electronic principles. It is being pointed out that the prime mover cannot be separated from the operative part and an item with a prime mover cannot be classified under 73. It is being pointed out that the following HSN Note to Chapter 7308 rules out classification of aerobridge under that heading:
"This heading covers complete or incomplete metal structures, as well as parts of structures. For the purpose of this heading, these structures are characterized by the fact that once they are put in position, they generally remain in that position. They are usually made up from bars, rods, tubes, angles, shapes, sections, sheets, plates, wide flats including so called universal plates, hoops, strip forgings or castings".
The contention is that Heading 7308 is for complete or incomplete metal structures made from metal bars, rods, tubes, angles etc. and not for sophisticated machinery.
5.The appellant also would point out that in contrast to the coverage of Heading 7308, Heading 8428 covers a wide range of machinery for mechanical handling of goods etc. (lifting, conveying, loading, unloading etc.).
6.The appellant has further pointed out that aerobridges had been imported at Chennai,, Calcutta, Cochin and those imports were cleared as machinery under Chapter 84. A list of such imports from 1985 to 1999 has also been filed. The appellant would emphasize that deviating from a Classification practice would not be permissible in the light of the ruling of the Hon'ble Supreme Court in the case of Tata Iron & Steel Co. Ltd. - 1997 (94) ELT138.
7.We feel the present dispute is altogether unwarranted in the scheme of Central Excise classification. It is to be noted that Chapter 73 is for "articles of iron or steel". The other chapter headings in this chapter also cover only articles of iron and steel: railway tracks (73.02), tubes and pipes (73.03), iron and steel structures like ropes shutters, balustrades, bridges and bridge-section (73.08), tanks, casks, drums, cans, boxes (73.10), containers for compressed or liquefied gas (73.11), stranded wires, ropes, cables etc. (73.12), cloth, grill, netting (73.14), chain and parts thereof (73.15), nails, tacks, drawing pins etc. (73.17), sewing needles (73.19), springs and leaves for springs (73.20), stoves, ranges, grates cookers etc. (73.21), radiators for central heating, not electrically heated (73.22), table, kitchen (73.23), sinks, washing basin (73.24), radiators for ships, drain cover (73.25). One thing common to these articles is that they are all made from iron and steel and have no machinery or prime mover forming part of them. They are simple articles of iron and steel. This is the position clarified by the aforesaid (Para 2) HSN Note also.
8.Other chapters in Section XV of the Tariff cover other base metals like, tin, sink, lead, aluminium and articles made from those base metals. It is after exhausting these 'base metals' and articles made from them in the earlier Section that Section XVI of the Tariff moves to cover "machinery and mechanical appliances". Chapter 84 in that section has a wide coverage of various machinery and mechanical appliances. Thus, the scheme of the Tariff is to classify articles of base metals and machinery under altogether different sections. The order of classification passed by the Commissioner (Appeals) is contrary to this scheme of the Tariff and is not sustainable.
9.In the result, the impugned order is set aside and the appeal is allowed, with consequential relief, if any, to the appellant, Airport Authority of India.
The operative part of the order was pronounced in the open Court at the end of the hearing.
Equivalent 2006 (076) RLT 0461 (CESTAT-Del.)
Equivalent 2006 (201) ELT 0506 (Tri. - Del.)
Equivalent 2006 (111) ECC 0463
Equivalent 2006 (137) ECR 0463 (Tri.-New Delhi)