Custom, Excise & Service Tax Tribunal
Calama Inds. Pvt. Ltd vs Commissioner Of Central Excise on 8 July, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT No. I Appeal No. E/2652/05 (Arising out of Order-in-Appeal No. BR(392) 49/MV/2005 dated 11.05.2005 passed by Commissioner of Central Excise (Appeals), Mumbai) For approval and signature: Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. Devender Singh, Member (Technical) ================================================
1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen of the Order?
4. Whether Order is to be circulated to the Departmental : Yes authorities?
Calama Inds. Pvt. Ltd.
Appellant Vs. Commissioner of Central Excise Mumbai Respondent Appearance:
None for appellant Shri N.N. Prabhudesai, Supdt. (AR) for respondent CORAM:
Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. Devender Singh, Member (Technical) Date of Hearing: 08.07.2016 Date of Decision: 08.07.2016 ORDER NO Per: M.V. Ravindran This appeal is directed against order-in-appeal No. BR(392) 49/MV/2005 dated 11.05.2005.
2. None appeared on behalf of the appellant despite notice.
3. We find that this matter is of 2005 hence we take up the matter for disposal even in the absence of any representation. It is noticed that on earlier occasions also when the matter was listed for disposal on 21.01.2016 and 11.05.2016 none appeared for the appellant. Heard the learned D.R.
4. The issue involved in this case is regarding the liability to duty on the parts which were captively utilised for manufacture of power driven pumps. The appellant had classified the parts under sub-heading 8413.00 and claimed exemption on them which were captively consumed under Notification 236/86. In respect of parts which were cleared duty liability @15% was paid. On scrutiny of parts it was observed by the department that these parts are finished goods themselves i.e. shaft and merit classification under sub-Heading 8483.00 attracting duty @ 20%. Show-cause notice was issued for the payment of differential duty which were adjudicated and confirmed by the adjudicating authority. Aggrieved by such an order, the appellant preferred an appeal before the first appellate authority who after following due process of law upheld the demands confirmed and rejected the appeal.
4.1 In the grounds of appeal, the main thrust of the argument of the appellant was that there was an error on the part of the first appellate authority to hold that pump shafts were not intended and actually used solely and principally in the manufacture of submersible pumps for handling water. They have also relied upon the HSN Explanatory Note-Chater 84 in Para (B) under head : General at Sr. (6) which talks about classification of the parts of the machine. It is also the Grounds that certain specified parts for which separate Heading has been provided and these parts will go in their respective heading of parts which are specifically provided and in case of Pump Shafts (parts of submersible pump) there is no specific heading provided. In another ground taken by the appellant that in the matter of classification dispute, the burden of proof is on the department and they have not produced any supporting evidence in support of their claim that the pump shaft would fall under C.H. 84.83, the classification proposed is incorrect.
5. On consideration of the submissions made by learned D.R. and perusal of the records, we find that the impugned order of the first appellate authority is seems to be correct and needs to be upheld for more than one reason.
5.1 Firstly, we find that identical issue in the case of EIMCO Elecon (India) Ltd. - 2009 (237) ELT 293 (Tri. Ahmd.) this Tribunal has held that classification of modified parts to suit machinery will be classifiable under special Heading of the CETA, 1985.
5.2 Secondly, we find that similar issue of classification of pumps - parts and accessories of power driven pumps (such as shaft, worm wheel, nut washer, gasket, valves, bearing etc.) are classifiable in their respective Heading from 84.80 to 84.84 of CETA, 1985 is finding recording on merits by the Bench in the case of Swelore Engg. P. Ltd. 2000 (119) ELT 481. The findings of the Bench are directly applicable in the case in hand as in the case of Swelore Engg. P. Ltd. (supra); the issue was very same we reproduce, with respect, findings in paragraphs 4 and 5.
4. It is thus evident that parts of machines which?. are in themselves goods included in any other heading of Chapter 84, are in all cases to be classified in their respective headings. In the present case, parts such as valves, bearings, bearing cover, crank shaft, pulley etc. are covered by Heading Nos. 84.81, 84.84 of the Schedule to the CETA 1985. They are not parts of articles of Headings 84.84, 85.44, 85.45, 85.46 or 85.47 - they are parts of power driven pumps falling under Heading 84.14. By applying the provisions of Note 2(a) to Section XVI, these parts are required to be classified in their respective headings even though they may be machined or tailor-made to be suitable for use for solely or principally with a particular kind of machine viz. power driven pumps. We therefore, uphold the classification arrived at by the lower authorities and reject the contention of the assessees that the disputed items fall for classification under Heading 84.13 as parts of PD pumps under Heading 84.85 as machinery parts not elsewhere specified.
5. The case relied upon by the appellants viz. the?. decision of the Tribunal in the case of Mahindra & Mahindra Ltd. [1986 (26) E.L.T. 269] is distinguishable. In that case, the goods such as shafts, cranks, gears were classified by the Customs authorities under the Customs Tariff Heading No. 87.04/06 as parts of motor vehicles as against partys claim under Heading 84.63. The Tribunal upheld the classification as confirmed by the Revenue in view of the provisto to Section Note 2(e) of Section XVII and Section 1(k) of Section Note XVI of the Import Tariff of the Customs Tariff Act, 1975, and not in view of the end-use of the products. In this case, the goods in dispute are classifiable under various sub-headings of Chapter 84 and not under Heading 84.13, in view of Note 2(a) to Section XVI of the Schedule to the CETA 1985. The further plea of the appellants that some of the parts are purchased by them either directly from manufacturer of parts, or from the open market on payment of duty and these parts are not manufactured by them, has not been substantiated and therefore, is rejected.
4.5 In view of the foregoing and authoritative judicial pronouncements, we uphold the impugned order. Accordingly, the appeal is rejected.
(Operative Part pronounced in Court) (Devender Singh) Member (Technical) (M.V. Ravindran) Member (Judicial) nsk 1 5 Appeal No. E/2652/05