Custom, Excise & Service Tax Tribunal
Cce, Chennai vs M/S. Sundaram Fastners Ltd on 28 April, 2008
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
E/398/2001
(Arising out of Order-in-Appeal No. 19/2000 (M-III) (D) dated 29.12.2000 passed by the Commissioner of Central Excise (Appeals), Chennai)
For approval and signature
Honble P. G.CHACKO, Member (Judicial)
Honble P.KARTHIKEYAN, Member (Technical)
__________________________________________________
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CCE, Chennai : Appellant
Vs.
M/s. Sundaram Fastners Ltd., : Respondent
Appearance Shri N.J. Kumaresh, SDR, for the appellant Shri M. Kannan, Adv., for the respondent CORAM Shri P.G. CHACKO, Member (Judicial) Shri P. KARTHIKEYAN, Member (Technical) Date of hearing : 22.04.2008 Date of pronouncement : 28.04.2008 Final ORDER No.________/2008 Per P. KARTHIKEYAN This is an appeal filed by the Revenue. In the impugned order, the Commissioner (Appeals) decided that spur gear and pinion wheel manufactured by M/s.Sundaram Fastners are classifiable under CSH 8414.99 of the first schedule to Central Excise Tariff Act, 1985. The respondents had argued before the Commissioner (Appeals) that the impugned goods were tailor-made for use as parts of electric fans and were sold only to dealers in fans. Moreover, there was a specific entry under Chapter heading 84.14 namely air or vaccum pumps, air or other gas compressors and fans; ventilating or recycling goods incorporating a fan whether or not fitted with filters. There was no specific entry or mention about spur gear or pinion wheel under CH 84.83, the classification canvassed by the Department. He found that 8414.99 specifically covered parts and accessories of goods covered by 8414.
2. Heard both sides. The Ld. SDR submits that as per Note 2 (a) of Section XVI of the tariff, parts which are goods included in any of the headings of Chapter 84 or Chapter 85 (other than heading nos. 84.85 and 85.48) are in all cases to be classified in their respective headings. He submits that gears and gearing and fly wheels figure under chapter heading 84.83. The items spur gear is a gear and pinion wheel is a fly wheel. As these items are covered by chapter heading 84.83, they are appropriately classifiable under chapter heading 84.83. The Ld. SDR submitted HSN explanatory notes dealing with parts under Section XVI which mandates that parts which are articles covered by a heading of Section XVI, they are in all cases to be classified in their own appropriate heading even if specially designed to work as part of a specific machine. This note applied in particular to transmission shafts, gears and gearing, bearing housing, plain shaft bearings, fly wheels etc. They fell under chapter heading 84.83.
3. The Ld. SDR also submitted copy of a judgment of the Apex Court in Intel Design Systems (I) Pvt. Ltd. Vs. CC & CE [2008 (223) ELT 135 (S.C.), in support of the plea that the impugned goods are to be classified under chapter heading 84.83.
4. The Counsel for the respondent relies on the decision of this bench in their own case reported in 2007 (213) ELT 215 (Tri.-Chen.) and a judgment of the Tribunal in Moosa Haji Patrawala Vs. CCE Bombay [1997 (96) ELT 55 (Tri.)].
5. We have carefully examined the case records and submissions by both sides. As rightly argued by the Ld. SDR, the impugned items figure under heading 84.83 of the tariff. Section note 2 of Section XVI of the Central Excise Tariff reads as follows:
Subject to Note 1 to this Section, Note 1 to Chapter 84 and to Note 1 to Chapter 85, parts of machines (not being parts of the articles of heading No. 84.84, 85.84, 85.45, 85.46 or 85.47) are to be classified according to the following rules:-
(a) Parts which are goods included in any of the headings of Chapter 84 or Chapter 85 (other than heading No. 84.85 and 85.48) are in all cases to be classified in their respective headings.
(b) .
(c) .. As per Rule 1 of interpretative rules, classification of excisable goods is to be determined according to the terms of the heading and in terms of section/chapter notes. This being the unambiguous statutory position, the impugned goods which figure in chapter heading 84.83 have to be necessarily classified under heading 84.83 in view of the above Section note even though they are parts designed for exclusive use in machines falling under Chapter 84. In the decision of this Bench relied upon by the Ld. Counsel, we had remanded the matter for a fresh decision on classification in accordance with law. The said order was passed on the basis of the submissions by the party that the lower authorities had ordered classification of the items impugned therein without individually examining the merits of the classification declared by the party or proposed by the department. The assessee in that case manufactured about 600 items. The decision was a remand to adjudicate the matter in accordance with law. We find that the decision of the Tribunal in Moosa Haji Patrawala case (supra) is inconsistent with the Section note 2 of Section XVI. We are not bound by the above decision of a single member of the Tribunal. The appeal of the revenue is allowed.
(Order pronounced in the open Court on )
(P.KARTHIKEYAN) (P.G. CHACKO)
MEMBER(T) MEMBER (J)
BB
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