Customs, Excise and Gold Tribunal - Tamil Nadu
Precision Rubber Industries Pvt. Ltd. vs Commr. Of C. Ex. on 19 March, 1998
Equivalent citations: 1998ECR408(TRI.-CHENNAI), 1998(101)ELT109(TRI-CHENNAI)
ORDER
U.L. Bhat, J. (President)
1. The assessee is aggrieved by the Order-in-Appeal No. 61/96, dated 19-6-1996 passed by the Collector of Central Excise, Bangalore, confirming the Order-in-Original No. 3/95, dated 10-1-1995 passed by the Assistant Collector, Bangalore.
2. The appellant, engaged in the manufacture of Synthetic Rubber Cots (un-hardened Rubber) for use in auxiliary Textile machinery and appliances of Chapter sub-heading 84.48 filed a classification list in respect of Cots claiming classification under sub-heading 4009.99 which carried Nil rate of duty. The Asstt. Collector classified Costs under sub-heading 4016.99 which carried 15% duty. This order having been confirmed by the Collector (Appeals), the assessee has filed the present appeal.
3. Shri Suneeth Katarki, ld. Counsel for the appellant has drawn our attention to the decision in the case of Inarco Ltd. 1997 (90) ELT 104 (Tribunal) which held that Cots are in the shape of Tubes referred to in sub-heading 4009, since they are specially made for use as parts for use in Textile machinery and appliances, by virtue of Note l(a) of Section XVI of the Tariff the governing sub-heading would be 8448.00. Ld. Counsel submitted that this decision is to be followed even though neither side in this case set up the Chapter Heading 8448. The answer of Shri Victor Thiagaraj, SDR is that Cots cannot be regarded as Tubes simpliciter, that Cots are Tubes on which various processes are carried out and therefore cannot any longer be regarded as Tubes and would fall under the residuary Heading 40.16 as any other articles of Synthetic Rubber and in view of Note l(a) of Section XVI the article will not fall under Chapter 84 but will fall under Heading 40.16. He also placed reliance on the decision in the case of Anand Motors Ltd. -1993 (68) E.L.T. 845 (Tribunal).
4. None of the records in the case describe Cots or the process of manufacture of Cots. We find the description of Cots given by revenue extracted in para 3 of the order in Inarco Ltd. -1997 (90) E.L.T. 104 (Tribunal). The description is that Cots are made out of Synthetic Nitrile Rubber Compound and that the Cot Tube is a single layer construction made by extrusion process. The vulcanised Tubes are processed further with chemical treatment, cut to specification and sizes and thereafter bevelling or spiral grooving is made. In the light of this description there can be no controversy that Cotsare essentially Tubes and since the material is Synthetic Rubber they are Synthetic Rubber Cots. Shri Victor Thiagaraj, SDR referred to the contention of revenue in Inarco Ltd. that because of cutting, and bevelling etc. Cots can no longer be regarded as Tubes and must be regarded as distinct products. This contention has been answered in the very same decision relying on the decision of the High Court of Bombay in Precision Rubber Industries -1990 (49) E.L.T. 170 and the decision of the Supreme Court in Bharat Forge & Press Industries Ltd. -1990 (45) E.L.T. 525 (S.C.) in the context of old Tariff 16A(3) (Piping and Tubing of unhardened Vulcanised Rubber), Old Tariff 16A respectively. The order written by the ld. Judicial Member Shri S.L. Peeran referred in detail to this material. It was in that context that the ld. Judicial Member held that Cots fall under 4009 and not under Heading 4016. It is interesting to note that at an earlier stage the revenue supported Heading 4016. but at the stage of final argument revenue gave up Heading 4016 and pleaded Ch. 8448 and Shri H.K. Bhatnagar, Vice President upheld this later stand of the department and the ld. Third Member agreed with the view taken by ld. Vice-President. In other words the real contest was between Headings 4009 and 8448. The decision is clearly an authority for the position that Cots dp not fall under Heading 4016. This means that but for Chapter 84 Cots would fall under Heading 4009. Chapter Note l(a) of Section XVI states, among other things, that the Section does not cover other articles of kind used in the machinery or mechanical applicances, of unhardened vulcanised Rubber (Heading No. 40.16). In view of the fact that Cots attract Heading 4009.00 and not 4016 the exclusion clause of Section XVI cannot apply and therefore Heading 84.48 will apply.
5. We have looked into the decision in Anand Motors Ltd. - 1993 (68) E.L.T. 845 (Tribunal). The decision dealt with Bushing Kits, Suspension Kits, Steering rods etc.. made of vulcanised rubber. It was held that these articles fall under the [residuary] Heading 4016 and by virtue of Section Note 2(a) of Section XVII these articles cannot be regarded as parts or accessories covered by Chapter 87. The question of applicability of Chapter 84 and the Section Notes of Section XVI did not arise for consideration in that decision. The case did not relate to Tubes falling under sub-heading 4009. In this view this decision cannot be of any assistance to us in resolving the present controversy.
6. Following the decision in Inarco Ltd. - 1997 (90) E.L.T. 104 (Tribunal) we hold that article in question viz. Cots fall under sub-heading 8448.00. This shall be treated as approved classification. The impugned order is set aside and the appeal is allowed.