Customs, Excise and Gold Tribunal - Delhi
Collector Of Customs vs Asea Brown Boveri Ltd. on 1 January, 1800
Equivalent citations: 1997(95)ELT66(TRI-DEL)
ORDER Jyoti Balasundaram, Member (J)
1. The Revenue is aggrieved by the order of the Collector of Customs (Appeals) Bombay classifying 'Arc Chamber Insulator' imported by the respondents herein under sub-heading 8546.20 of the Customs Tariff Act - according to the Revenue, the imported item is insulator fittings for circuit breakers and are parts of circuit breakers and therefore, covered appropriately by sub-heading 8547.10 of the Customs Tariff.
2. We have heard Shri Ojha, learned DR and Shri Willingdon Christian learned Advocate and carefully considered their submissions. We find from the catalogue of SF 6 circuit breaker that insulating column forms part of the circuit breaker. The respondents do not dispute that the item in question is a part of circuit breaker. Therefore, the question that remains to be seen is whether an item which is an insulator but ready to fit article, and actually fitted to a circuit breaker will be covered by the description of insulating fittings for electrical machines, appliances or equipment under sub-heading 85.47. The HSN Explanatory Notes to Headings 85.46 and 85.47 are relevant for deciding the question before us. The HSN Notes to Heading 85.46 sets out that insulators of this heading are used for fixing, supporting or guiding of electric current conductors while at the same time, insulating them electrically from each other, from earth etc. The heading excludes insulating fittings (other than insulators) for electrical machinery, appliances or equipment; these fall under Heading 85.47 if they consist wholly of insulating material (apart from any minor components of metal incorporated during moulding solely for purposes of assembly). The Explanatory notes also set out that insulators may be made of any insulating material. (In this case, they are made of Ceramics). Insulators are used on outdoor cables e.g. in telecommunications, power networks, and also for indoor installations or on certain machines and appliances. The HSN Explanation to Heading 85.47 sets out that this heading covers all insulating fittings for electrical machinery, appliances or apparatus provided (a) They are wholly on insulating material or are of wholly insulating material (e.g. plastics) apart from any minor components of metal incorporated during moulding solely for the purpose of assembly and (b) they are designed for insulating purposes even though at the same time, they have other functions. The notes also make it clear that insulating fittings of this heading can be made of any insulating material (e.g. glass, ceramic, plastics etc.). The Notes further set out that the insulating fittings of Heading 85.47 cover inter alia, bases and other parts of switches, circuit breakers etc. From the HSN Explanatory Notes what is clear is that insulating fittings which are parts of circuit breakers are covered by Heading 85.47.
3. In the present case, the item in question is a part of the circuit breaker. Although it is firstly an insulator, it has gone beyond the scope of being just a insulator which is covered by Heading 85.46 and it has become a insulating fitting for electrical machines, in this case, a insulating fitting for circuit breakers. It is a ready to fit article and is actually fitted to a circuit breaker. The argument of the learned Counsel that the item has all along been described an insulator, and it is different from the kind of goods covered under Heading 85.47, is not acceptable for the reason that even though the item is [of] insulating material, it cannot be considered as an insulator of a kind covered by Heading 85.46. The Reference in Tariff Heading 85.47 to other than insulators of Heading 85.46, in our view, refers to insulators which are used on machines and appliances as recognised by the HSN Explanatory Notes to Heading 85.46. In other words, since insulators can also be used on certain machines and appliances, it is insulators fitted on machines for appliances which are excluded from sub-heading 85.47. However, insulating fittings for electrical machines are covered under Heading 85.47 and the goods in question, as we have already held above, are in the nature of insulating fittings for circuit breakers and appropriately covered by Heading 85.47.
4. The learned Counsel relies upon the judgment of the Larger Bench of the Tribunal in the case of Voltas Ltd. v. Collector of Customs, Bombay reported in 1987 (27) E.L.T. 117 and submitted that the item in question is an insulator and therefore, covered by Heading 85.47. On a careful reading of the order referred to, we find that the Tribunal was concerned with Tariff entry 85.18/27 which covers' "Electrical capacitors : electrical apparatus for making and breaking electrical circuits for the protection of electrical circuits, or for making connections to or in electrical circuits, ... insulators of any materials; insulating fittings for electrical equipment;
(1) Not elsewhere specified 100%
(2) xxx
(3) x x x x
(7) Insulators designed for use in an
electrical transmission system of
400 volts or above 40%"
and the Tribunal held that the item in question was covered by Sub-clause (1) of this heading and not under Sub-clause (7) thereof. The Tribunal was not considering the question as to whether the item falls for classification under the new Tariff sub-heading 8546 or 8547 and therefore, this judgment is not applicable on all fours to the facts of the present case. In view of the HSN Explanatory Notes which clearly stipulate that insulating fittings including parts of circuit breakers are covered by Heading 85.47 and since the imported goods in this case are parts of circuit breakers, they are insulating fittings falling for classification under Heading 85.46. Further we also note that the importers themselves had claimed that these are parts of circuit breakers for the propose of availing of the benefit of exemption in terms of Notification 155/86. The undisputed position is that the goods are parts of circuit breakers and having regard to the fact that they are insulating fittings, we hold that the Revenue is correct in seeking to classify them under Heading 8547.10; therefore, we set aside the impugned order and allow the appeal of the Revenue.