Custom, Excise & Service Tax Tribunal
Ksb Pumps Ltd vs Commissioner Of Central Excise, Pune I on 19 August, 2015
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
Appeal No.
E/2061/05
- Mum
(Arising out Order-in-Appeal No. P.I./116/2005 dated 25.02.2005 passed by the Commissioner of Central Excise (Appeals), Pune)
For approval and signature:
Honble Shri P.K. Jain, Member (Technical)
Honble Shri S.S.Garg, Member (Judicial)
1.
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
:
No
2.
Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
:
Yes
3.
Whether Their Lordships wish to see the fair copy of the Order?
:
Seen
4.
Whether Order is to be circulated to the Departmental authorities?
:
Yes
KSB Pumps Ltd.
Appellant
Vs.
Commissioner of Central Excise, Pune I
Respondent
Appearance:
Shri M.P.S. Joshi, Advocate for the appellant Shri H.M. Dixit, AC (AR) for the respondent CORAM:
Honble Shri P.K. Jain, Member (Technical) Honble Shri S. S. Garg, Member (Judicial) Date of hearing : 06.08.2015 Date of decision : 19.08.2015 O R D E R No:..
Per: P.K. Jain:
The brief facts of the case are that appellant is manufacturer of various types of pumps which includes industrial pumps. They also manufacture base frame which are used for mounting of such pumps. The dispute in the present case is classification of such base frames. Revenues contention is that such base frame would be classifiable under 8485.90 while the appellant claimed that these are classifiable under 8413.90. The period of dispute is from March 1994 to March 1995.
2. Ld. counsel for the appellant submitted that the Tribunal vide order no. 2330/01-WZB/C-I dated 11.08.2001 in appeal no. E/2403/96 reported in 2001 (34) ELT 401 had remanded the present case to Commissioner (Appeals) to re-examine the matter in view of the directions given in para 5 & 6 of the said order. Ld. counsel showed us the photograph of different types of pumps manufactured by them. He further submitted that in case of big size pumps, it is essential that these are mounted on heavy frame so that vibration does not spread. He further submitted that before the Commissioner (Appeals) they have submitted number of charts indicating that for different models of pumps they have different base frame and thus even base frames are not interchangeable from one model to other. In view of this position, the base frames are for a particular machine, in fact for a particular model of pumps and in view of this fact these would be correctly classifiable under 8413.90. He further submitted that these cannot be classifiable under 848590 as the said heading is a residuary heading and covers only those parts which cannot be classified under other headings. He also submitted copy of the purchase order and invoice as also the concerned HSN explanatory notes and the Chartered Engineers certificate wherein it is certified that base frame of each pumps is of exclusive design for a particular pump set only. It is not interchangeable with any pump set manufactured by KSB Pumps Ltd. He further submitted that Commissioner (Appeals) has relied upon few transactions wherein they have sold the pump set without the base frame as the particular customer may not be needing the base frame. He further submitted that this cannot be the reason for considering that the goods are classifiable under 8485.90.
3. Ld. AR, on the other hand, took us through the impugned order and submitted that the appellants are selling the pumps without base frame to many customers and also with base frames to others. This itself would indicate that the base frame is not an essential part of the pump set. It can at the most be called an accessory and in view of this position, classification of the item under 841390 is ruled out. He further submitted that perusal of the HSN explanatory notes under 8485 would indicate that base plates are specifically covered under 8485 and hence the correct classification of the base frame which are similar to base plates would be under 848590.
4. We have considered the rival submissions.
5. At the outset, we have gone through the purchase order and invoices rates during the hearing. It is seen from the purchase order received from Bokaro Steel Plates that the purchase order speaks of centrifugal pump, in addition to the said pump it speaks of few items such as base frame, mechanical seal, cufflings etc. The purchase order gives separate value for the bare pumps and separate value for other items. The base frame with foundation bolts is found as a separate item with separate value. We have also seen the invoice. Even in the invoice produced, we find the appellant is charging for the pump separately and certain other items such as base frame separately. We also note that in the invoice the appellant used the term base plate only. During the hearing, the ld. counsel for the appellant admitted that they have sold the bare pump also to some of the customers and it was explained by him that some customer may not be needing the base frame as they may be installing as per their own requirement. From the above, facts it is clear that the base frame is not an integral part of the pump but is a accessory which helps in efficient functioning of the pump. It is only because the item is a not an integral part of the pump that it is not sold in composite prices of the pump but separately as different item in the invoice. In view of this factual position, we are of the view that the base frame cannot be considered as part of the pump. We note that part of the pump are classifiable at the relevant time under CSH 8413 and Note under the said heading for the parts of the pump is as under:-
PARTS Subject to the general provisions regarding the classification of parts (see the General Explanatory note to Section XVI), parts of the goods of this heading are also classified here e.g. pump housing or bodies; rods specially designed to connect and drive the piston in pumps placed at some distance from the prime mover (e.g. pumping rods, sucker rods); pistons, plungers, canes; cams (lobes helicoidal screws, impeller wheels, diffuser vanes; buckets and bucket-fitted chains; bands for band type liquid elevators; pressure chambers.
6. It would be seen that base frame is not one of the items listed therein. Moreover, it would be seen from the list that various parts which are listed therein forms the integral part of the pumps and are not being invoices separately even by the appellant.
7. On the contrary, if we go through the HSN explanatory notes to heading 8485 we find that the relevant heading and the explanatory notes are as under:-
84.85 MACHINERY PARTS, NOT CONTAINING ELECTRICAL CONNECTORS, INSULATORS, COILS, CONTACTS OR OTHER ELECTRICAL FEATURES, NOT SPECIFIED OR INCLUDED ELSEWHERE IN THIS CHAPTER. In general, therefore the goods of this heading are such as can be recognised as being parts of machines, but not as parts of any particular machine. Subject to these conditions, the heading includes non-automatic lubricating pots, greasing nipples, oil seal rings, hand wheels, levers and hand grips, safety guards and base plates.
8. A combined reading of the above would indicate that 8485 covers certain parts which are used in a wide variety of machine but are not included by specific names under Chapter 84 in other headings (e.g. ball bearing). Moreover, the said explanatory notes specifically include base plates under 8485. Base plates by very nature would also include base frame and thus would be covered by 8485.90. Base plates and base frames are designed keeping in view the machine or mechanical appliances to be mounted on it. As discussed earlier the base frame is not an integral part of the pump, it is only an accessories to the pump. Even the appellant sells the pump without base frame, as also with base frame. Whenever he is selling along with base frame, its price is separately charged. Keeping in view the above facts in our considered view, the base frame would be classifiable under 8485 and not 8413, irrespective of the fact that such base frames are designed for specific model of the pumps.
9. In the result, the appeal is dismissed.
(Pronounced in Court on .) (S. S. Garg) (P.K. Jain) Member (Judicial) Member (Technical) //SR 7 E/2061/05