Customs, Excise and Gold Tribunal - Delhi
Indian Airlines vs Collector Of Customs on 30 January, 1987
Equivalent citations: 1987(12)ECC11
ORDER
D.C. Mandal, Member
1. In the cases covered by these appeals, the appellants imported a number of consignments of new and retreaded tyres for aeroplanes. In the case covered by Appeal No. CD (SB) 2338/83-C, one consignment of new tyres was imported under bill of entry No. D.I. 555 dated 16-4-1982 and one consignment of retreaded tyres for aeroplane was imported under bill of entry No. D.I. 456 dated 13-4-1982. Appeal No. CD (SB) 2339/83-C relates to import of three consignments of retreaded tyres under bills of entry Nos. D.I. 71 dated 1-6-1982, D.I. 621 dated 14-6-1982 and D.I. 1049 dated 22-7-1982 and one consignment of new tyres of aeroplane under bill of entry No. D.I. 1033 dated 22-7-1982. Appeals Nos. CD (SB) 2419/83-C and C-1588/85-C relate to import of new aeroplane tyres. Three consignments of retreaded tyres were imported in the case covered by Appeals Nos. C-1558/86-C, C-2324/86-C and 2325/86-C. In all these cases, the imported tyres were assessed to basic customs duty under heading 40.05/16(2) of the First Schedule to the Customs Tariff Act, 1975 (hereinafter referred to as C.T.A., 1975) read with notification No. 145/77-Cus dated 9-7-1977 at the rate of 3% ad valorem. In the case of retreaded tyres, value for the purpose of assessment was taken to be the cost of retreading plus freight and insurance charges in accordance with the notification No. 204/76-Cus. dated 2-8-1976. Countervailing duty equivalent to central excise duty under item 16(4) of central excise tariff was charged in all these cases. Auxiliary duty of customs was also charged in the original assessment in the cases covered by Appeals Nos. CD (SB) 2419/83-C and C-1588/85-C. The appellants claimed reassessment of the goods under heading 88.01/03(2) of C.T.A., 1975 read with notification No. 99/81-Cus. dated 1-4-1981 @ 3% ad valorem without countervailing duty on the ground that the imported tyres were spare parts of aeroplanes. In the cases of retreaded tyres they further claimed that c.v. duty was not chargeable as retreading of tyres was not a process of manufacture within the meaning of Section 2(f) of the Central Excises & Salt Act, 1944. They also claimed that no auxiliary duty was chargeable on the tyres of aeroplanes. The appellants claimed refund of duty accordingly.
2. The refund claims in respect of basic customs duty and countervailing duty were rejected in all these cases by the Assistant Collector of Customs. He held that the tyres for aeroplanes could not be treated as parts of aeroplanes and as such the same could not be assessed to duty under heading 88.01/03(2) of C.T.A., 1975 read with the notification No. 99/81-Cus. dated 1-4-1981 at 3% ad valorem without countervailing duty and that the imported tyres were correctly assessed under the specific tariff heading 40.05/16(2) of C.T.A., 1975 read with notification No. 145/77-Cus dated 9-7-1977 at 3% ad valorem with countervailing duty under item 16 of central excise tariff. As there was no notification exempting the aeroplane tyres from the countervailing duty, the imported tyres were correctly charged to c.v. duty. So far as the auxiliary duty is concerned, the Assistant Collector held in the case of Appeal No. CD (SB) 2419/83-C that the same was not chargeable under notification No. 60-Cus/82 dated 28-2-1982. He did not, however, pass any order regarding auxiliary duty in the case covered by appeal No. C-1588/85-C.
3. Appeals were filed against the orders of the Assistant Collector. The Collector of Customs (Appeals), Calcutta, upheld the decision of the Assistant Collector in respect of the basic customs duty in all cases and the countervailing duty on the new tyres. In respect of retreaded tyres, he held in the cases pertaining to Appeals No. CD (SB) 2338/83-C and CD (SB) 2339/83-C that countervailing duty was not chargeable on retreaded tyres as retreading was not manufacture, but in the cases covered by Appeals Nos. C-1558/86-C, C-2324/86-C and C-2325/86-C he confirmed the Assistant Collector's order rejecting the appellants' claim for exemption of c.v. duty on the retreaded tyres. The Collector of Customs (Appeals) did not pass any order on the auxiliary duty in the case relating to Appeal No. C-1588/85-C.
4. The issues to be decided by us, therefore, are:--
(i) Whether the tyres imported by the appellants are parts of aeroplanes and assessable to basic customs duty under heading 88.01/03(2) of C.T.A., 1975 at 3% ad valorem or whether the same are correctly assessable under heading 40.05/ 16(2) as done by the Custom House;
(ii) Whether the imported tyres are exempted from countervailing duty; and
(iii) Whether auxiliary duty of customs was chargeable on the imported goods.
5. We have heard Shri Ashok Desai, learned advocate for the appellants in Appeals Nos. CD (SB) 2338 and 2339/83-C and Shri S.N. Mathur, learned consultant in the other five appeals for the appellants. Shri Desai has argued that aeroplane tyres are parts of aeroplane as the same are important landing gears of aeroplanes. In support of his arguments he has drawn our attention to the certificate dated 19-7-1982 signed by Shri S.G. Goswami, Controller of Aeronautical Inspection, Civil Aviation Department, Government of India (copy of the certificate filed by the appellants with the paper book) and has relied upon the decisions reported in (i) [1966] 17 STC 96 (Vithal ChhaganS- Sons v. State of Gujarat) and (ii) [1968] 22 STC 202 (State of Gujarat v. B.G. Batwara & Co.). He has also stated that 140 landings are the average life time of aeroplane tyres and the same requires constant repairing and monitoring in order to keep the aeroplane going. Landing is an important part of aeroplane function. He has drawn our attention to the photocopies of the relevant pages of Civil Aircraft Inspection Procedure--Aircraft Systems and Equipments and the Maintenance Manual of Boeing 737 aeroplanes and has stated that tyres form part of aircraft systems and equipments, and unsatisfactory tyre maintenance can affect tyre performance and reliability and jeoparadise aircraft safety. Various checks of tyres and tubes have been prescribed for the safety of aircraft. The tyres in question Were imported by the appellants for servicing of the aeroplanes. Being spare parts of aeroplanes and imported for servicing of the aeroplanes, these tyres were assessable under heading 88.01/03(2) of C.T.A., 1975 @ 3% ad valorem without countervailing duty under notification No. 99-Cus dated 1-4-1981. He has argued that an aeroplane is not sold without tyres and this distinguishes the present case from the case of typewriter ribbons [State of Uttar Pradesh and Anr. v. Kores (India) Ltd.].
6. Arguing in the other five appeals Shri Mathur has adopted the arguments of Shri Desai. He has further added that in Chapter I of the Import and Export Policy for April, 1985-March, 1988, the word "spare" has been defined as a part or sub-assembly or assembly for substitution, i.e., ready to replace an identical similar part or sub-assembly or assembly, if it becomes faulty or worn out, and includes an accessory (or attachment) in the same regard. In paragraph 7(15) of the same chapter, "part" has been defined as an element of a sub-assembly or assembly, not normally useful by itself and not amenable to further disassembly for maintenance purposes. (It could be a component, spare or accessory depending upon the nature of its use/requirement). He has also referred to the dictionary meaning of "spare", "part" and "spare part" and has said that the imported tyres are covered by these definitions and dictionary meaning. Regarding retreaded tyres, the contention of Shri Mathur is that the same are not liable to c.v. duty. Retreading charges are to be taken into account for valuation only on their import after retreading abroad.
7. Arguing for the respondent-Collector, Shri Sundar Rajan, learned Departmental Representative and (sic) stated that aeroplane is assessable to customs duty under heading 88 of the C.T.A., 1975. Aeroplane engine falls under tariff heading 84.06 and the aeroplane engine parts are classifiable under specific headings, failing which under heading 84.06. Rubber tyres and tubes fall under the specific heading 40.05/16. He has argued that wheel discs are parts of aeroplanes, but tyres and tubes are not parts of aeroplane. In support of his arguments he has relied upon the following decisions, viz.,
(i) State of Uttar Pradesh and Anr. v. Kores (India) Ltd.
(ii) (Tribunal) Indian Airlines v. Collector of Customs, New Delhi.,
(iii) [1970] 26 STC 108 Bajoria Halwasiya Service Station v. The State of Uttar Pradesh and Anr.
(iv) [1979] 43 STC 141 Commissioner of Sales Tax, U.P. v. Punjab Gramophone House.
Shri Sundar Rajan has argued that replacement of tyres is not servicing. There is a basic difference between servicing and replacing. The imported tyres are not parts of aeroplanes and therefore, benefit of exemption notification No. 99-Cus dated 1-4-1981 cannot be extended to aeroplane tyres. He has further argued that countervailing duty is chargeable on retreaded tyres. For this argument, he has relied upon this Tribunal's decision in the case of (i) Indian Airlines v. Collector of Customs reported in 1983 ELT 993 and (ii) Collector of Customs, Bombay v. Vardhman Spinning & General Mills Ltd. and Anr., , He has prayed that the appeals may be dismissed.
8. We have gone through records and have considered the arguments addressed for the appellants and the respondent. For proper appreciation of their arguments, we reproduce below the relevant tariff headings and the exemption notifications:--
(i) Tariff Heading 40.05/16(2) of C.T.A., 1975:
40.05/16. Preparations (including master batches) of natural or synthetic rubber, manufactures of natural or synthetic rubber, whether or not vulcanised or hardened, not elsewhere specified, vulcanised rubber thread and cord, whether or not textile covered, and textile thread covered or impregnated with vulcanised rubber; waste and scrap of hardened rubber;
(1) Not elsewhere specified (2) Rubber tyres and tubes for wheels of all kinds (3) Transmission, conveyor or elevator belts or belting of vulcanised rubber.
(ii) Tariff Heading 88.01/03(2):
88.01/03. Aircraft and parts thereof:
(1) Not elsewhere specified (2) Aeroplanes and parts thereof.
(iii) Notification No. 145/77-Cus dated 9-7-1977:
In exercise of the powers conferred by Sub-section (1) of Section 25 of the Customs Act, 1962 (52 of 1962), and in supersession of the notification of the Government of India, in the Department of Revenue and Banking No. 301-Customs dated the 2nd August, 1976, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts:
(a) aeroplanes,
(b) aeroplane parts,
(c) aeroplane engines,
(d) aeroplane engine parts, and
(e) rubber tyres and tubes used exclusively for aeroplanes, when imported into India, from so much of that portion of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), as is in excess of 3 per cent ad valorem.
(iv) Notification No. 99/81-Cus dated 1-4-1981:
In exercise of the powers conferred by Sub-section (1) of Section 25 of the Customs Act, 1962 (52 of 1982), the Central Government being satisfied that it is necessary in the public interest so to do, hereby exempts aeroplane spare parts, when imported into India for the servicing of aeroplane, from so much of that portion of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975, as is in excess of 3 per cent ad valorem and from the whole of the additional duty leviable thereon under Section 3 of the second mentioned Act.
9. In Webster's New World Dictionary, at page 717, "spare" has been defined as "not in regular use, extra, an extra part, thing".
In the Chambers Twentieth Century Dictionary, Revised Edition, at page 1058, the same term has been defined as "kept or available for others or for such purposes as may occur."
In Webster's New World Dictionary, page No. 544 "part" has been defined as a "a division or portion of a whole", "an essential separable element", "a segment or organ as of the body".
"Spare parts" have been defined in the Chambers Twentieth Century Dictionary--Revised Edition, page 1058 as "a duplicate kept or carried for emergencies".
10. The appellants have claimed assessment of the imported rubber tyres under heading 88.01/03/(2) as parts of aeroplanes, whereas the department has assessed the tyres under heading 40.05/16(2). Chapter 40 of the First Schedule to the Customs Tariff Act, 1975 is meant for assessment of "rubber, synthetic rubber, factice, and articles thereof." Tariff heading 40.05/16(2) provides for assessment of "rubber tyres and tubas for wheels of all kinds." The scope of this heading is wide enough to cover rubber tyres for wheels of all kinds. It does not restrict itself to tyres of general use only. To express in other words, the tyres made exclusively for use in aeroplanes are not excluded from this heading. In the exemption notification No. 280-Cus dated 2-8-1976 "rubber tyres and tubes used exclusively for aeroplanes" were shown to be falling in Chapter 40 of the First Schedule to the Customs Tariff Act. In Rule 3(a) of the Rules for interpretation of the Customs Tariff it has been laid down that the heading which provides the most specific description shall be preferred to headings providing a more general description. The heading 40.05/16(2) provides for the most specific description of tyres of all kinds. The imported rubber tyres, though for use in the aeroplanes, should, therefore, fall under heading 40.05/16 (2) of C.T.A, 1975. The Custom House has correctly assessed the imported tyres under heading 40.05/16(2) of C.T.A 1975 and charged basic customs duty @ 3% ad valorem under notification No. 145/77-Cus dated 9-7-1977.
11. We shall now turn to the next important point whether the imported tyres are spare parts of aeroplanes. The learned advocate for the appellants has cited (i) [1966] 17 STC 96 and (ii) [1968] 22 STC 202 in support of his argument that tyre is a part of aeroplane. In Vithal Chhagan & Sons v. State of Gujarat [1966] 17 STC 96 the question was whether wrist watch-cases with chromo-steel back are spare parts of watches within the meaning of entry 10 of Schedule E to the Bombay Sales Tax Act, 1959, and the Division Bench at page 99 of the report has explained:
...a spare part would, therefore, mean any integral part of an article which is carried, held or kept in reserve for future use or to supply an emergency or which is addition or extra....It is implicit in this meaning that the part in question must be a part which is severable and capable of being substituted or replaced by another, for otherwise there would be no point in having an additional or extra part or carrying, holding, or keeping such part in reserve for future use or to supply an emergency.
Applying this meaning of the words "spare parts" to wrist watch-cases, the Division Bench of Gujarat High Court held that the wrist watch-cases were spare parts of watches and would fall within entry 10 of Schedule E. While holding as above, the Hon'ble High Court observed that the watch-case in that particular case was absolutely essential for the functioning of a wrist watch as a wrist watch. The wrist watch would of course show the time even without the watch-case, but it would not be possible to use it as a wrist watch unless the mechanism is fitted in the watch-case. In the case of State of Gujarat v. B.G. Batwara & Co. [1966] 22 STC 202 Gujarat High Court applied the same meaning and same test as is meant by a spare part to the facts of the case of Batwara & Co., and held that the old tyres of the kind which were sold by the assessee, were capable of being fitted to bullock carts and were interchangeable parts and when fitted would go to complete a whole bullock cart. As against the above, the learned Departmental Representative has stated that the wheel discs are parts of aeroplanes, but the tyres are not parts of aeroplane. In support of his arguments he has cited several judgments which are discussed in the next paragraph.
12. (i) [State of Uttar Pradesh and Anr. v. Kores (India) Ltd.]. In this case, the Hon'ble Supreme Court held that typewriter ribbon is an accessory and not a part of the typewriter (unlike spool), though it may not be possible to use the latter without the former. Just as aviation petrol is not a part of the aeroplane nor diesel is a part of bus, in the same way, ribbon is not a part of the typewriter though it may not be possible to type out any matter without it.
(ii) (Tribunal) (Indian Airlines v. Collector of Customs, New Delhi, decided on 14-9-1983). In this case, it was contended on behalf of the appellants that the aeroplane miniature lamps were specific parts of Boeing 737 aeroplane which were exclusively ordered and meant for it. The lamps were manufactured according to the specifications laid down by the manufacturers of Boeing aeroplanes, they were aircraft parts catalogued items. This Tribunal held that the aeroplane miniature lamps, though used for aeroplanes, were correctly classifiable as electric lamps under the specific heading 85.18/27(4) and not as parts of aeroplanes under heading 88.01/03 of the Customs Tariff Act, 1975 in terms of interpretative Rule 3(a) read with Section note 2(f) of Section XVII of the said Act.
(iii) [1979] 43 STC 141 (Commissioner of Sales Tax, U.P. v. Punjab Gramophone House). It was held by the Hon'ble Allahabad High Court that gramophone needles were not component parts of gramophone as they are not integral constituents of the gramophone. The Hon'ble High Court observed that as the words "component parts" have been used in reference to gramophones, they refer only to such parts as are integral to the gramophone and go to constitute the mechanical contrivance known as "gramophone"
(iv) [1970] 26 STC 108 (Bajoria Halwasiya Service Station v. The State of Uttar Pradesh and Anr.). In this case, the Division Bench of Allahabad High Court held that the term spare patrs, when used with reference to motor vehicles, is a duplicate part of a motor vehicle kept in readiness to replace loss, breakage, etc. A bus body cannot be called a spare part in that sense. Bus bodies are to be fabricated and constructed when needed and they are not available in the market as such. Therefore bus bodies could not be taxed at the rate of 10% as spare parts of motor vehicles under notification No ST-2263/X-950(1)-64 dated 18-6-1965, issued under Section 3-A of the U.P. Sales Tax Act, 1948.
13. In the cases before us, the tyres were imported separately (i.e., not fitted in the aeroplanes) from M/s. Goodyear (Thailand), Bangkok and M/s Dunlop Malaysian Industries Berhad, Malaysia. The goods were described in the purchase orders No. B 16212 V dated 24-2-1982 and No. F/2AC/00531 dated 5-5-1982 (copies filed in Appeals No. CD(SB) 233-8-83-C and CD (SB) 2339/83-C respectively) as tyres. In the invoices Nos. 0211 and 0212 dated 16-2-1982 (Filed in Appeaf No. CD (SB) 2339/83-C, Nos. 0281, 0282, 0283 and 0284 all dated 15-9-1982 (filed in Appeal No. CD (SB) 2419/83-C) and Nos. 0554, 0555 and 0556 all dated 1-10-1983 (filed in Appeal No. C-1588/86-C) of M/s. Dunlop Malaysian Industries Berhad, the goods were described as "new aircraft tyres". In the invoice No. THX-20123 dated 4-3-1982 of M/s. Goodyear (Thailand) Limited (Filed in Appeal No. CD (SB) 2338/83-C) the goods were described as "Goodyear New Aircraft Tyres". Similarly, in their invoices Nos. and dated illegible (stated in the appeal Memorandum of Appeal No. C-1558/85-C to be invoices No. 50003, THX-50021 and THX-50059), this supplier described the goods as aircraft tyres. The appellants also described the goods as aeroplane tyres. In none of the documents the imported goods were described as aeroplane parts or spare parts of aeroplanes. From the description in the invoices it is evident that the foreign suppliers sold the goods as tyres and not as aeroplane parts. The plea taken by the appellants in the refund claims and subsequent appeals is that the tyres are spare parts of aeroplanes. The learned advocate for the appellants has argued before us that the tyres are landing gears of aeroplanes and landing is an important part of aeroplane function and, therefore, the tyres are parts of aeroplanes. Tyres are mounted in the wheel assembly of the aeroplanes. In our view, the wheel assemblies of aeroplanes are integral parts of aeroplanes and the tyres are in the nature of accessories like ribbon of a typewriter and the needles of a gramophone. A typewriter cannot be used without ribbon, but the Supreme Court has held in Kores (India)'s case that ribbon is an accessory and not a part of typewriter. Similar view has been taken by Allahabad High Court in respect of needles of a gramophone, although gramophone cannot be used without the needles. We are of the view that the things which get consumed, such as aviation petrol of an aeroplane and diesel of a bus, or the items which are subject to rapid wear and tear like ribbon of a typewriter and tyres of an aeroplane, are not parts of the aeroplane and typewriter, etc. Average life time of aeroplane tyres as stated by the learned advocate is 140 landings only. Parts are those items which go into the construction of and are intergral parts of the whole article. The wheel assemblies of an aeroplane thus fall within the category of parts of aeroplane. The tyres imported separately as tyres as in the present case cannot be considered as parts of aeroplane like ribbon cannot be a part of a typewriter. The analogy of tyres of a bullock cart cannot hold good in the present case as a bullock cart cannot move without the tyres, whereas tyre is not in use when an aeroplane flies in the air. Similarly, the decision reported in [1966] 17 STC 96 is not applicable in the present cases as these are distinguishable from the case of Vithal Chhagan & Sons inasmuch as it is not possible to use a wrist watch without a watch case, whereas the circumstances are different in the case of aeroplane tyres. The argument that the tyres were for exclusive use in aeroplane does not help the appellants' case in the light of the above discussions. As in the appellant's another case, aeroplane miniature lamps, though meant for exclusive use in aeroplanes, where held by this Tribunal to be not parts of aeroplanes, but classifiable as electric lamps. The dictionary meaning of the spare parts and the definition of spares and parts in the Import Policy are applicable in the appropriate cases, but in view of decisions of the Supreme Court, Allahabad High Court and the decision of this Tribunal as discussed earlier, the definition and the dictionary meaning relied upon by the. appellants do not improve their case. In the exemption notification No. 145/77-Cus dated 9-7-1977, "Rubber tyres and tubes used exclusively for aeroplanes" have been shown separately from the "aeroplane parts". This also goes to prove that rubber tyres and tubes are not parts of aeroplanes because if they were parts then there could be no necessity to show them separately. As the imported tyres are not parts of aeroplanes, they do not qualify for the exemption of countervailing duty under notification No. 99/81 Cus dated 1-4-1981.
14. The appellants have contended that countervailing duty was not payable on retreaded tyres as retreading was not a process of manufacture under Section 2(f) of the Central Excises & Salt Act, 1944. The learned Departmental Representative has relied upon this Tribunal's decisions and 1983 ELT 993 in support of his argument that countervailing duty is leviable on retreaded tyres. In the case of Collector of Customs, Bombay v. Vardhaman Spinning & General Mills Ltd. and Anr., , this Tribunal held that old machines were classifiable under item 68 of central excise tariff and second hand machines were liable to additional duty of customs on importation into India under Section 3(1) of the Customs Tariff Act, 1975 as such duty does not bear any nexus with the nature and quality of goods irnported. Similar view was held by this Tribunal in the case of Indian Air Lines, New Delhi v. Collector of Customs, Delhi 1983 ELT 993. In paragraph 8 of this order the Tribunal observed that Section 3(1) of the Customs Tariff Act was of very wide amplitude.
It covers the case where a like article is actually being produced or manufactured in India. It also covers a case where a like article is not produced or manufactured; in that case the duty is leviable as leviable on the class or description of articles to which the imported article belongs....
The case reported in 1983 ELT 993 related to importation of retreaded tyres of aircraft. In paragraph 10 of that order, the Tribunal held as follows:--
As pointed out above, the additional duty of customs is relatable to the act of importation. It has also been related to the class or description of articles to which the imported article belongs. The history of the imported article, as to whether it is new or old, in prime condition or repaired, while they would have relevance to the valuation of the article, would not affect the class or description to which the article belongs, and which is to be seen with reference to the relevant entries in the central excise tariff schedule. The relevant entry in the present case is item No. 16, namely, 'tyres' which has been amplified as follows:--
"Tyres" means a pneumatic tyre in the manufacture of which rubber is used and includes the inner tube, the tyre flap and the outer cover of such a tyre.
Thus the description does not per se rule out old or retreaded tyres, since these also fall within the class or description of 'tyres'. It is a different matter that a particular indigenous tyre, although it falls within the tariff item, is not chargeable to central excise duty by reason of the fact that the manufacturing process has already been completed at a previous stage of that particular tyre. This would no doubt be relevant if the question is whether one of charging it to excise duty. It is not, however, material with reference to the specific provision for levy of additional duty of customs under Section 3(1) of the Customs Tariff Act.
The cases of retreaded tyres before us are fully covered by the above decision. We entirely agree with the said decision and hold that additional duty under Section 3(1) of the Customs Tariff Act was correctly chargeable on the retreaded tyres imported in the present cases.
In the cases covered by Appeals Nos. CD(SB) 2338 and 2339/83-C, the Collector of Customs (Appeals) has held that countervailing duty was not chargeable on retreaded tyres as retreading was not manufacture. This view of the Collector (Appeals) was incorrect. As, however, the Revenue did not file any appeal against those two orders of the Collector (Appeals), the Department is not to deprive the appellants of the benefit of countervailing duty given by the Collector, but the benefit should remain confined to those particular cases only and should not be applied to others.
15. So far as auxiliary duty of customs is concerned, the issue was already decided by the Assistant Collector or Collector (Appeals) holding that auxiliary duty was not payable, except in the case covered by Appeal No. C-1588/85-C. In the case covered by Appeal No. C-1588/85-C, the goods were imported under bill of entry No. D.I 462 dated 11-11-1983. The goods were assessed under tariff heading 40.05/16(2) read with notification No. 145/77-Cus dated 9-7-1977 at concessional rate of 3% ad valorem. The goods which enjoyed partial exemption of basic customs duty under notification No. 145/77-Cus dated 9-7-1977 were exempted from the auxiliary duty of customs during the period under notification issued under Section 25(1) of the Customs Act, 1962. The appellants were, therefore, entitled to the benefit of this exemption.
16. We have thus decided the issues before us in the following terms:--
(i) Imported tyres were correctly assessed under Heading 40.05/16(2) of C.T.A, 1975 read with notification No. 145/77-Cus dated 9-7-1977. These tyres were not parts of aeroplanes and hence were not classifiable under heading 88.01/03(2).
(ii) Additional duty of customs under Section 3(1) of the Customs Tariff Act, 1975 was leviable on the imported tyres, including the retreaded tyres. As those tyres were not aeroplane parts, those were not exempted from the additional duty under notification No. 99/81-Cus dated 1-4-1981.
(iii) The tyres imported against bill of entry No. D.I 462 dated 11-11-1983 and assessed at the concessional rate under notification No. 145/77-Cus dated 9-7-1977 were exempted from the auxiliary duty of customs.
17. In the circumstances, subject to our findings in the last sub-paragraph of paragraph 14 and those relating to auxiliary duty as above, we uphold the impugned orders and dismiss the seven appeals listed in this order.