Customs, Excise and Gold Tribunal - Tamil Nadu
Commissioner Of Central Excise vs Sharana Industries on 28 September, 2005
ORDER P.G. Chacko, Member (J)
1. This appeal of the Revenue is against an order of the lower appellate authority allowing the benefit of exemption under Notification No. 205/88-C.E., dated 25-5-88 to the assessee in respect of "electric storage batteries" and classifying "wooden stands" (used by them for keeping such batteries) as articles of wood under SH 4410.90 of the CETA Schedule attracting "Nil" rate of duty.
2. Ld. SDR reiterated the grounds of this appeal. Ld. Counsel for the respondents submitted that the 'batteries' in question were used by their customers as 'parts of wind mills' and, therefore, the goods were eligible for exemption in terms of SI. No. 12 in the Table annexed to Notification No. 205/88-CE., dated 25-5-88 (as amended). He relied on the Tribunal's decision in Associated Manufacturer (India) v.
CCE, Calcutta 2002 (147) E.L.T. 714 (Tri.-Kolkata), wherein 'bolts and screws', which were used as 'parts of cycle and cycle rickshaws' were held to be eligible for the benefit of Notification No. 62/86-C.E. Ld. Counsel also showed us photographs of wooden stands/racks with the batteries placed thereon.
3. SI. No. 12 in the Table annexed to Notification No. 205/88-C.E. reads : "wind mills, parts of wind mills and any specially designed devices which run on wind mills". It appears from the records and the submissions made before us that the electrical energy generated by the wind mills was stored in the batteries under consideration, wherefrom D.C (Direct Current) was inverted into AC (Alternating Current) which, in turn, was consumed for the intended purpose. Thus the batteries in question were only a means to store the energy generated by wind mills. In answer to a query from the Bench, ld. Counsel has submitted that large-sized wind mills do not require batteries for storage of the energy output. The "wind mills" mentioned at SI. No. 12 of the Table annexed to the Notification must include mills of all sizes. But, only small-sized wind mills require batteries for storage of energy generated. Other wind mills do not require them. Since batteries are not invariably used with wind mills of all sizes and specifications, it can hardly be said that a battery is a part of wind mill. Consequently, the benefit of exemption under Notification No. 205/88-C.E. will not be available to the batteries in question. The case of Associated Manufacturer (supra) is clearly distinguishable inasmuch as 'bolts' and 'screws' were essential parts/accessories of cycles and cycle rickshaws.
4. Ld. SDR has relied on the Tribunal's decision in Collector of Customs v. Kodi Medical Electronics Pvt. Ltd.
, wherein battery was held not to be a part of electronic medical equipment as it was found to be a mere source of power for the equipment. This decision appears to lend support to the Revenue's contention that general purpose batteries cannot be considered as parts of wind mill.
5. As regards "wooden stands/racks", we have found that these items were suitable only for placement of batteries at higher levels above the ground and also worked as an insulation between the batteries and the ground. These wooden stands/racks were not to be treated as "furniture" items classifiable under Heading 94.03. These can only be classified as 'articles of wood' under Heading 44.10 as claimed by the assessee.
6. For the reasons noted above, we set aside the impugned order to the extent of holding that the benefit of exemption under Notification No. 205/88-C.E. was not available to the batteries in question. As regards the classification of the wooden stands/racks, the order of the Commissioner (Appeals) is upheld.
7. The Revenue's appeal stands allowed in part only.
(Operative part of the order was pronounced in open Court on 28-9-2005)