Customs, Excise and Gold Tribunal - Tamil Nadu
Commissioner Of Customs vs Scientific Instruments Co. Ltd. on 9 July, 2007
Equivalent citations: 2007(121)ECC416, 2007(147)ECR416(TRI.-CHENNAI)
ORDER P.G. Chacko, Member (J)
1. The short question arising in this appeal of the Revenue is whether the benefit of Notification No. 36/96-Cus. Dated 27.03.1996 (S.No. 153 read with item No. 18 of List No. 9) is available to waveguide, terminators and pressure windows imported by the respondents and cleared under three bills of entry dated 25.08.1996, 29.11.1996 and 07.01.1998. The goods falling under Chapter 84, 85 or 90 and specified in List No. 9 appended to S.No. 153 in the Table annexed to the above Notification, were chargeable to Basic Customs Duty @ 20%. Item No. 18 in List No. 9 was "microwave passive components". One of the three items imported by the respondents was waveguide. All the three items were described in the relevant invoice as "microwave passive items". The importer claimed the benefit of concessional rate of duly under the above Notification by classifying the items under Heading 85.29. The Assistant Commissioner of Customs ordered assessment of the goods by classifying the same under Heading 83.07 and denied the benefit of the Notification. In appeal, the Commissioner (Appeals) classified the goods under Heading 85.44 (sub-heading 8544.11) but left to the lower authority the question whether the benefit of the Notification was admissible to the goods. Both sides preferred appeals to this Tribunal, the Revenue seeking assessment under Heading 83.07 and the assessee seeking assessment under Heading 85.29. This Tribunal vide Final Order dated 04.07.1997 reported in 1997 (95) E.L.T. 564 (Tribunal) ordered classification of the goods under SH 8544.20. This classification came to be affirmed when the Revenue's Civil Appeal against the Tribunal's decision was dismissed by the apex court vide Commissioner v. Scientific Instruments Co. Ltd. 1999 (106) E.L.T. A67 (S.C.). In the result, classification of the goods imported by the respondents stands settled under SH 8544.20.
2. In the present appeal, the contention of the Revenue is that the benefit of the above Notification cannot be extended to anything in running length inasmuch as the specific item at S.No. 18 of List No. 9 ibid is a "component". In this connection, reliance has been placed on the Tribunal's decision in Collector of Customs, Bombay v. Hydranautics Membrane (India) Ltd. , wherein one of the questions considered was whether the benefit of exemption under Notification No. 155/86-Cus. was available to the imported goods which were in running length and not cut to size or ready for fitment as component part of any article or machinery. In the said case, it was held that 1600 yards of "Membrane support substrate - Polyster cloth" and 512 yards of "Product carrier - Polyster impregnated fibre" imported in the form of rolls would have to be deemed only as raw materials and not parts and, on this basis, the benefit of the said Notification was denied to the importer. The relevant entry in the said Notification had contained the expression "parts'. Today, learned SDR has also relied on the Tribunal's decision in B.R. Industrial Trading Co. v. Commissioner of Customs, Mumbai , wherein waveguide imported by the assessee was ordered to be assessed in the form in which it was presented for assessment. In the cited case, the Bench considered Hydranantics Membrane (India) (supra) also.
3. On the other hand, learned Counsel submits that a waveguide by its very nature is a microwave passive component as it is known in the industry. Learned Counsel refers to Eneyclopedia Britannica and submits that 'waveguide' is a device for propagation of electromagnetic waves, such as radio waves, infrared rays, and visible light. He submits that typical examples of 'waveguides' include hollow metallic tubes, co-axial cables, and optical fibres. In the present case, it is pointed out, the item is a corrugated flexible copper tubing used for passage of microwave. Such a tubing has to be in running length for uninterrupted passage of microwave from its source to the destination. In this connection, learned Counsel has invited our attention to a purchase order placed on the respondents by the Department of Telecommunication, Government of India. This document mentions the route scheme for waveguides to be laid by the respondents in terms of their contract with Telecommunication Department. A few of the routes (segments) mentioned in this document are Bangalore-Tumkur, Bangalore-Kolar, Mysore-Mandya, Allepey-Shertallai and Quilon-Tiruvalla. It appears from this document that the copper tubing in running length was used as microwave passive component to connect the specified places. This document also mentions pressure windows and terminators, the other two items covered by the subject imports. Learned Counsel has also referred to a book authored by Joseph Feinstein. The chapter on "passive microwave components" contains an account of the use of rectangular waveguides. Finally, it is urged that the decision of the lower appellate authority be upheld.
4. After giving careful consideration to the submissions, we find that the classification of the items imported by the respondents has been settled under SH 8544.20. This subheading covers co-axial cable and other co-axial electric conductors. It is not in dispute that goods falling under this sub-heading would attract S.No. 153 of the Table annexed to Notification No. 36/96-Cus. Microwave passive components are mentioned as item No. 18 in List No. 9 appended to S.No. 153 ibid. The documents presented before us, viz. literature on the subject, purchase orders placed on the respondents by the Department of Telecommunications, extracts from Encyclopaedia Britannica, etc. indicate that the corrugated flexible copper tubings imported by the respondents were actually used as microwave passive components, and so were the terminators and pressure windows. These items constitute a system for transmission of microwave from place to place. The argument of the Revenue appears to be that, to qualify for the benefit of S.No. 153 in the Table annexed to the subject Notification, a copper tubing should be precisely of the length required to be used as a component in the microwave transmission system. The Revenue has no case that the tubings imported by the respondents were not used in such systems. The argument of the appellant is too hypertechnical and does not subserve the intent underlying S.No. 153 of the Notification. The appellant has relied on the Tribunal's decision in Hydranautics Membrane (India) case. The cited decision concerned another Notification (No. 155/86-Cus.). The question considered in that case was whether the imported goods, which was in running length and was meant to be used as parts of article/machinery, could be treated as raw material or parts. The goods in question was held to be raw material and consequently the benefit of Notification No. 155/86-Cus. was denied to the importer. In the present case, however, the appellant has not raised such a question. It is not their case that the copper tubings imported by the respondents were only "raw material". As a matter of fact, the memorandum of appeal does not even mention this expression. The decision of the Tribunal in the case of B.R. Industrial Trading Co. (supra) has also been considered by us. Though, in this case, a similar waveguide was considered for classification, the question whether exemption under any Notification was admissible to the goods did not arise for consideration. Hence the decision in B.R. Industrial Trading (supra) is also of no aid to the appellant. As rightly pointed out by learned Counsel, the Tribunal's decision rendered in the case of the respondents 1997 (95) E.L.T. 564, affirmed by the Supreme Court, was not considered by the Bench in the case of B.R. Industrial Trading (supra).
5. In the result, the appellate Commissioner's order allowing the benefit of S.No. 153 (read with item No. 18 of List No. 9) of the Table annexed to Notification No. 36/96-Cas.(SIC) to the respondents is sustained and this appeal is dismissed.
(Dictated and pronounced in open court)