Customs, Excise and Gold Tribunal - Delhi
Basant Rubber Factory (Pvt.) Ltd. vs Collector Of Central Excise on 20 January, 1983
Equivalent citations: 1983ECR301D(TRI.-DELHI), 1983(12)ELT408(TRI-DEL)
ORDER
1. Two questions are under consideration in this case :-
(1) whether rubber tubing of unhardened vulcanised rubber, of the size ID 6 mm x 8 mm OD, manufactured by the appellants is liable to duty under item 16A(3) of the Central Excise Tariff; and (2) if so, whether it is exempted from payment of the above duty by Virtue of entry 3 in Notification No. 197/67-CE which exempts rubber piping and tubing designed to be component parts of machinery articles.
2. the case was argued before us on 20-1-1983. Shri S.C. Chawla, on behalf of the appellants, showed a sample of the subject rubber tubing and stated that it was manufactured by them for supplying exclusively to the Indian Railways, that it was designed to be used as sealing channel for glass and louver (window) shutters of railway coaches, that it was manufactured in accordance with Indian Railway Standard Specification for Rubber Profiles and Tubing used for sealing and rolling stock, serial number R-57-75, that it was not intended to be used for conveyance of liquid, gas or air and that, therefore, it did not fall under item 16A(3) CET. His alternative plea was that the subject rubber tubing should be exempted from payment of duty by virtue of Notification No. 197/67-CE as it was used as component part of railway coaches and such component part did not perform the function of conveying air, gas or liquid.
3. On behalf of the Department, Shri Tayal stated that item 16A(3) CET was very specific to cover the goods and that railway coaches being not machinery articles, exemption under Notification No. 197/67-CE did not apply.
4. We have given our earnest consideration to the matter. For convenience of reference, we reproduce below the relevant entry from the Tariff:-
"16A. Rubber Products, the following, namely :-
(1) X x X (2) X X X (3) Piping and tubing of unhardened vulcanised rubber. (4) X X X
Entry 3 in the Table annexed to exemption Notification No. 197/67-CE reads as under :-
"Piping and tubing designed to be, or converted in the factory of its production into, component parts of machinery articles (including typewriters), provided such component parts do not perform the function of conveying air, gas or liquid".
5. We have seen the sample of the subject rubber tubing presented by Shri Chawla. It is, without doubt, tubing of unhardened vulcanised rubber having a uniform diameter throughout its length and in shape and appearance resembles any rubber tubing used for conveying air, gas or liquid. We also observe that the appellants themselves describe and market it as rubber tubing. The Indian Railway Standard Specification, according to which it is designed, also describes it as rubber tubing. Thus, by the trade parlance test also the subject goods are known as rubber tubing only. As regards the argument of intended use, we find that the tariff entry makes no stipulation as to the end use. It may be that conventionally rubber piping and tubing are generally known to be used for conveying air, gas or liquid. But with the development of new industrial processes and technologies, it is hardly correct to rule out alternative uses of the goods. The fact that the subject rubber tubing is designed to be used as sealing channel by the Indian Railways cannot take it out of the category of rubber tubing when it squarely answers the description of "rubber tubing" and when the seller and the buyer clearly regarded it as rubber tubing. As regards the appellants' alternative plea of exemption under Notification No. 197/67-CE, we find that by no stretch of imagination can glass and window shutters or, for that matter, even railway coaches be regarded as machinery articles. As the relevant entry in the Notification confines the exemption to rubber piping and tubing designed to be component parts of machinery articles (including typewriters), the said exemption cannot extend to the subject rubber tubing. We, therefore, agree with the arguments advanced on behalf of the Department that the subject rubber tubing is specifically covered by item 16A(3) CET and is not entitled to the exemption contained in Notification No. 197/67-CE.
6. Accordingly, we reject the appeal.