Tesa Tapes (India) P. Ltd. vs Commissioner of Customs, Mumbai>1999(05)LCX0154

1999(05)LCX0154

S/Shri Gowri Shankar, Member (T) and J.N. Srinivasa Murthy, Member (J)

Order No. 1114/99-WZB/C-I, dated 18-5-1999 in Appeal No. C/1057-R/98-Bom

Cases Quoted

Bakelite Hylam Ltd. v. Collector — 1985(08)LCX0053 Eq 1985 (022) ELT 0879 (Tribunal) — Referred................. [Para 6]

Chetna Polycoats P. Ltd. v. Collector — 1988(07)LCX0042 Eq 1988 (037) ELT 0253 (Tribunal) — Relied on [Paras 3, 6, 8, 9]

Collector v. Bakelite Hylam Ltd. — 1997(03)LCX0041 Eq 1997 (091) ELT 0013 (S.C.) — Relied on......................... [Para 3]

Collector v. Hydranautics Membrane (I) Ltd. — 1994(01)LCX0073 Eq 1994 (071) ELT 0711 (Tribunal)
— Distinguished .................................................................................................... [Paras 4, 7]

Collector v. Kinjal Electricals P. Ltd. — 1997(03)LCX0091 Eq 1997 (093) ELT 0425 (Tribunal) — Relied on [Paras 3, 6, 9]

Intek Tapes Pvt. Ltd. v. Collector — 1991(08)LCX0009 Eq 1992 (059) ELT 0097 (Tribunal) — Referred................. [Para 6]

Miles India Ltd. v. Collector — 1983(08)LCX0039 Eq 1983 (014) ELT 2457 (Tribunal) —Referred ...................... [Para 4]

Raja Radio Co. v. Collector — 1995(05)LCX0122 Eq 1995 (077) ELT 0251 (S.C.) — Distinguished............... [Paras 4, 8]

Shriram Refrigeration Industries v. Collector — 1992(08)LCX0015 Eq 1993 (063) ELT 0593 (Tribunal) — Referred [Paras 4, 6]

Advocated By : Shri Prakash Shah, Advocate, for the Appellant.

Shri A.K. Chatterjee, SDR, for the Respondent.

[Order per : Gowri Shankar, Member (T)]. - The question for consideration in this appeal is the classification of the goods described in the invoice as flame retardant polyester electrical insulation tape. The importer had claimed classification under Heading 8546.90 of the tariff, whereas the Department had ordered them classifiable under Heading 3919.90.

2. Heading 85.46 is for electrical insulator of any material. Sub heading 10 is of goods made of glass, ceramic and sub-heading 90 for others. Heading 3919.90 is adhesive plates, sheets, film, voil, tape, strip and other flat shapes of plastic, whether or not in roll. Sub-heading 10 is for rolls not exceeding 20 metres and Heading 90 is for others. There is no dispute that the goods in question are adhesive. The only question therefore is whether they are electrical insulators or not.

3. Advocate for the appellant contends that in the order of the Commissioner (Appeals) impugned before us or in the order of the Assistant Commissioner which was appealed before the Commissioner (Appeals), there is no dispute that the goods have the property of electrical insulation. Both these authorities have denied the classification claimed only on the ground that the goods are in the form tape 600 millimetres wide and 60 metres long and that before they have to be used as insulation tapes they are to be stripped into smaller width and short in length and bound in proper shape. They are therefore not insulators but are only insulating material for making insulators. The Commissioner (Appeals) has drawn an erroneous distinction between the materials and insulators which are made from such material and held that such material itself would not fall for classification under Heading 8546. He contends that the goods can in fact be used in the size in which they are imported to provide insulation in transformer coil windings. He next contends that in any case, all insulators of whatever material, are to be classified under Heading 8546 irrespective of their dimension. Industrial laminated sheets having insulating properties have been ordered to be classifiable under Heading 8546.00 by the Supreme Court in C.C.E. v. Bakelite Hylam Ltd. [1997(03)LCX0041 Eq 1997 (091) ELT 0013 (S.C.) = 1997 (014) RLT 204. (S.C.) Classification of electrical insulation tape was specifically considered by the Tribunal in Chetna Polycoats (P) Ltd. v. C.C.E. 1988 (037) ELT 253. Classification under the Customs Tariff of such goods was considered in C.C.E. v. Kinjal Electricals Pvt. Ltd. 1997 (093) ELT 425. Both decisions have held that the goods to be classifiable under Heading 8546.00. Heading 8546.00 is more specific and more appropriate to the goods in question. Trade notices of various collectorates (based on circular 90/91-CX3, dated 8-8-1991) have held such goods classifiable under Heading 8546.00.

4. The departmental representative contends that the goods, in the manner in which they are imported cannot be used for insulators. Chapter 85 is for machinery and parts. Plastic tapes in running length cannot be considered to be or parts. Tribunal’s decision in C.C.E. v. Hydranautics Membrane (India) Ltd. 1994 (071) ELT 711 is cited in support to say that the goods of plastic have multiple uses and Heading 39 therefore is more appropriate. Even if the goods have electrical properties their composition would determine the classification. Tribunal’s decision in Miles India Ltd. v. C.C. 1983(08)LCX0039 Eq 1983 (014) ELT 2457J is cited for this purpose. Raja Radio Co. v. C.C. 1995 (077) ELT 251 and Shriram Refrigeration Industries v. C.C.E. 1993 (063) ELT 693 are cited in support.

5. There is no dispute that the goods in this case are made of polyester of the dimensions shown above. There is also no dispute by the Assistant Commissioner and the Commissioner (Appeals) that the goods have properties of electrical insulation. Both said that in the form in which the goods are imported they did not constitute insulators. The Commissioner (Appeals) further says that they require further smaller cutting and packing before it can be used as insulator.

6. In Chetna Polycoats Pvt. Ltd v. C.C.E. the question for consideration before the Tribunal was classification of goods generally known as insulation tape i.e. the dispute was whether the goods was classifiable under Heading 3919 or Heading 8546. The Tribunal referred to its earlier decision in Bakelite Hylam Ltd. v. C.C.E. 1985 (022) ELT 879. (In that decision the Tribunal concluded that articles made from materials which have electrical insulating properties can appropriately described as insulators and found rigid plastic laminated sheets and boards to be insulators classifiable under Heading 8546.) It noted that commercially the goods were known as insulation tapes and were purchased from dealers of electrical materials for purpose of insulation. The Tribunal’s decision in C.C.E. v. Bakelite Hylam Ltd. - 1997(03)LCX0041 Eq 1997 (091) ELT 0013 (S.C.) = 1997 (019) RLT 203 and the decision in C.C.E. v. Chetna Polycoats Pvt. Ltd. v. C.C.E. has been followed in Intek Tapes Pvt. Ltd. v. C.C.E. - 1992 (059) ELT 97. The decisions have been relied upon in C.C.E. v. Kinjal Electricals Pvt. Ltd. - 1997 (093) ELT 425 to confirm classification under Customs Tariff in the Customs Tariff under Section 85 of such tapes insulating tapes of plastic.

7. In C.C. v. Hydranautics Membrane (India) Ltd. v. C.C. - 1994 (071) ELT 711 the Tribunal was required to consider whether the goods which were in running length and cut to size for fitment could be considered to be parts of machinery which were exemption from duty by Notification 155/86. The Tribunal held that, in the form in which the goods had been imported they had not acquired the characteristic of parts, the goods itself would more appropriately be considered as raw material. This conclusion does not appear to be relevant to the facts of this case. We are not concerned here whether the goods are to be treated as parts of machinery. It does not appear to us that insulators classifiable under Heading 8546 have necessarily to be parts of any machinery. The rules of interpretation in the tariff makes it clear that chapter headings are not to be referred to for determining the scope of the tariff entries. This is a recognition of the principle of interpretation that headings of chapters of statute are not a guidance to their interpretation. One can think of various kinds insulators indisputably classifiable as such which would not be machinery or parts thereof. Porcelain insulators used in high tension transmission lines are not, by any stretch of imagination machinery or parts thereof. Neither transmission towers nor the lines they support one machinery or parts of a machinery. It is therefore not required for classification under Heading 8546 that goods have necessarily to be machinery or parts thereof. There are many other headings in the chapter which are really not parts of machinery. Primary cells and batteries under Heading 8506 are not machinery or a part. This is also true of portable electric lamps (heading 8513). Microphone stand (Heading 85.80), insulating fitting (Heading 8547), waste and scrap of various goods (Headings 8548).

8. The dispute in Raja Radio Co. v. C.C. - 1995(05)LCX0122 Eq 1995 (077) ELT 0251 (S.C.) was not whether the goods were insulators or not. It was whether the goods consisting of plastic paper basically which had electrical insulating properties were classifiable under Heading 3501 or Heading 48. It is in that context that the Supreme Court noted that the heading of the tariff as it then stood was wide enough to include composite and impregnated or coated paper and therefore, confirmed classification under Heading 48. The question as to whether the fact that the goods have insulating properties, and required them to be classifiable as insulators under Heading 8546 was not one raised before the Court. In Sri Ram Refrigeration Industries Ltd. - 1993 (063) ELT 593 the Tribunal held Melinex polyester film to be classifiable under Heading 3920.69 as claimed by the Department, ruling out classification of goods under Heading 8546.90 as electrical insulators. It found that the polyester film had a number of applications, only some of which were in the electrical industry; was of the view that the Tribunal decision in Chetna Polycoats Pvt. Ltd. v. C.C.E. would not apply because it dealt with goods under the Central Excise Tariff the goods having specific properties of insulation.

9. We are not able to see why a classification under the Central Excise Tariff would not apply to imported goods. Where the relevant entries are identically worded both in the Central Excise Tariff and the Customs Tariff and are based on Harmonised System of Nomenclature formulated by the Customs Co-operation Council (now the World Customs Organisation) and the words in both are identical. In fact, the decision in C.C.E. v. Kinjal Electrical Pvt. Ltd. has applied the ratio of the decision in Chetna Polycoats Pvt. Ltd. v. C.C.E. to insulating tape is long rolls.

10. It has not been alleged that the goods under consideration by us are capable of being used for purposes other than insulation. Adhesive tapes may b of various types, and not self adhesive would be classifiable under Heading 39.19, or fused for purposes other than insulation. Adhesive tapes may be of various tor example surgical or decorative paper rolls. The classification of identical goods both under the Central Excise Tariff and the Customs Tariff had been confirmed under the heading as claimed by the appellants. We consider that the goods are classifiable under Heading 8546 of the tariff.

11. Appeal allowed. Impugned order set aside. Consequential relief.

______

Equivalent 2000 (124) ELT 790 (Tribunal)