Customs, Excise and Gold Tribunal - Delhi
Escorts Tractors Ltd. vs Collector Of Customs on 29 August, 1997
Equivalent citations: 1998(98)ELT717(TRI-DEL)
ORDER S.S. Kang, Member (J)
1. Both these appeals involve common question of law, hence are being taken up together for final disposal. The appellants made import of Automatic Gear Tooth Rounding and Deburring machine and claimed the benefit of Notification No. 154/86-Cus., dated 1-3-1986 under the entry at Serial No. (i) 36 and 37. Vide the impugned order, the adjudicating authority held that since the imported machine is neither only a tooth chamfering machine nor it is only an automatic gear deburring and tooth rounding machine, but is capable of performing all the three functions, therefore it will not be covered by either of the entries at Serial No. 36 and 37 of sub-serial No. (1) of the table appended to Notification No. 154/86.
2. The learned Counsel appearing on behalf of the appellants submits that the Notification No. 154/86-Cus. covers at Serial No. 36 Gear Tooth Chamfering Machine and at Serial No. 37 Automatic Gear Deburring and Tooth Rounding Machine. She submits that the machine imported by the appellants perform all these functions. She also submits that in the impugned order, the Collector of Customs granted the benefit of import under OGL treating the machine to be particularly a chamfering machine. She submits that in the case of the appellants themselves, the Tribunal held that merely because the instrument also carry other functions than those specified in the notification should not be a ground for denial of the benefit of notification. She relied upon the decision of the Tribunal in the case of Escorts Ltd. v. CC, New Delhi - 1996 (88) E.L.T. 379 (Tribunal), and in the case of Escorts Ltd. v. CC, New Delhi - 1990 (47) E.L.T. 68. She, therefore, prays that the appeals be allowed. Shri A.K. Agarwal, SDR, appearing on behalf of the respondents submits that the notification provides concessional rate of duty for gear tooth chamfering machine at Serial No. 36 and at Serial No. 37 automatic gear deburring and tooth rounding machine. He submits that the notification does not cover the machine, automatic gear tooth rounding and chamfering machine, which was imported by the appellants. He submits that to interprete the notification, the observations made by the Collector in respect of granting benefit of the OGL are not binding. He submits that the machine imported by the appellants is covered under Serial No. (3) of the notification and is liable to duty @ 75%. He, therefore, prays that the appeals be dismissed.
3. Heard both sides. In this case the appellants made import of automatic gear tooth rounding and chamfering machine. Notification No. 154/86-Cus., dated 1-3-1986 provides as under :
"In exercise of powers conferred by Sub-section (1) of Section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the goods specified in Column (2) of the Table hereto annexed and falling under Heading Nos. 84.56, 84.57, 84.58, 84.59, 84.60, 84.61, 84.62, 84.63, 84.64 and 84.65 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), when imported into India, from so much of the portion of the duty of Customs leviable thereon which is specified in the said First Schedule, as is in excess of the amount calculated at the rate specified in the corresponding entry in Column (3) of the said Table and from the whole of the additional duty leviable thereon under Section 3 of the Customs Tariff Act. Provided that nothing contained in this notification shall affect the exemption under any other notification of the Government of India for the time being in force."
4. The table appended to the notification is in the three parts i.e. Serial No. (i), (ii) & (iii). Serial No. (i) covers various types of goods stated against Item No. 1 to 85 and the rate of duty is 35% ad valorem, Serial No. (ii) the rate of duty is 105% ad valorem, and at Serial No. (iii) the rate of duty is 75% ad valorem. In the impugned order the goods were held to be come under at Serial No. (iii) of the notification.
5. We find that Item No. 36 at Serial No. (i) covers Gear Tooth Chamfering Machine and the Item No. 37 covers Automatic Gear Deburring and Tooth Rounding Machine which attracts the rate of duty @ 35% ad valorem.
6. The Tribunal in the case of Escorts Ltd. v. Collector of Customs, New Delhi - 1996 (88) E.L.T. 379 (Tribunal), held that the benefit of notification cannot be denied on the ground that instrument also carry other functions which were specified in the notification. A similar view has been taken in the case of Escorts Ltd. v. Collector of Customs - 1990 (47) E.L.T. 68. In the present case, the machine imported by the appellants is Automatic Gear Tooth Rounding and Chamfering Machine. In the impugned order, the Collector has agreed that the machine is capable of performing of the three functions. The Collector of Customs in the impugned order also treated the machine to be particularly a Chamfering Machine for the purposes of OGL and granted the benefit of import under the OGL. Taking into account the ratio of the above mentioned decisions of the Tribunal and the entries of Notification, we find that the machine imported by the appellants is covered at Item No. 36 and 37 and is liable to assessment of duty as mentioned in the Serial No. (i) of the notification.
7. In view of the above discussion, the impugned orders are set aside and the appeals are allowed.