Customs, Excise and Gold Tribunal - Delhi
Vidyut Greenbank Castbasalt Pvt. Ltd. vs Collector Of Customs on 17 March, 1992
Equivalent citations: 1992(61)ELT84(TRI-DEL)
ORDER S.L. Peeran, Member (J)
1. The appellants are importers of High Alumina Refractory tiles for industrial boiler furnaces and claimed assessment under Heading 6902.20 of CTA 1975 or in the alternative has claimed benefit of Notification No. 124/87-Cus., dated 1-3-1987. However, the department has assessed the same under Heading 9806.00 read with Notification No. 68/87-Cus., dated 1-3-1987 and Notification No. 52/88-Cus., dated 1-3-1988.
2. The appeal of the importer was also rejected by the Collector (Appeals) Bombay by his order dated 12-9-1988. The learned Collector has held that the appellants' contentions are contradictory, differing and conflictory. He has held that "The bricks and tiles are not one and the same in trade as well as in common parlance. The Notification No, 124/87-Cus., dated 1-3-1987 covers 'bricks' but not 'tiles'. As the appellants claimed the benefit of the said notification which is applicable for parts and accessories classifiable under Heading 98.06, it is understood that they relinquished their claim for reassessment under Heading 6902.20 which was incorrect and not maintainable in view of Chapter Note 1 of Chapter 98 of CTA 1975."
3. The particulars given by appellants of the imported High alumina Refractory tiles are as follows -
"Alumina (A12 O3) side taper tiles specific gravity 3.45 back width 53.3 - thickness 25mm side taper angle 6 degree, Alumina content (A12 O3) minimum 85%"
It is pleaded in the appeal as follows -
(i) The consignment was assessed to duty under Heading 9806 read with customs Notification No. 68/87 dated 1-3-1987, as amended by Notification No. 182/87-Cus., dated 29-4-1987. The Asstt. Collector taking into consideration Note 1 to Chapter 98 classified the goods thereunder without granting the benefit of the notification in question. The Collector (Appeals) was not justified in rejecting the appeal as the appellant had a right to plead alternative pleas (i) regarding the classification of the goods under Heading 6902.00 or in the alternative of the benefit of Notification No. 124/87-Cus., dated 1-3-1987.
(ii) The imported goods are specifically provided under Heading 6902.00. The sub-heading 6902.00 only makes the distinction by reference to the percentage of alumina. Reference to Explanatory notes to the HSN is also made which states -
"That Heading 6902 or 6903 as 'other Refractory ceramic goods (for Ex. retorts, crucibles, muffles, nozzles, plugs, supports, cupels, tubes, pipes, sheeths and rods) other than those of siliceous fossil meals or of similar siliceous earths"
Reference to HSN Notes under Heading 6902 is also made which states -
"Refractory bricks, blocks, tiles and similar refractory ceramic constructional goods, other than those of siliceous fossil meals or similar siliceous earths"
It is stated that the goods imported by them specifically and categorically fall under specific Heading 6902.20.
(iii) The imported goods have very high abrasion resistance and used as lining material to the pipes leading to the furnace or with the power boilers. The power boilers for thermal power station are required to be fed with pulverised coal and the said pulverised coal is filled to the power station through the various pipes, bends, fillings etc. The outer covering of the said pipe system is made of stuff mild steel shells. These tiles are required to be fixed in the cement mortar, then only the lining becomes resistance to abrasion. This abrasion resistance pipe, bends are in fact the general purpose item which could be used on any plant (power/steel/coal) cement, fertilizer for conveying abrasive material as also on the furnaces.
(iv) On the basis of the above submissions, it is stated by the appellants that the tiles which are used as a lining material could be considered as a part of power boiler or furnaces to be classified under Chapter Heading 98.06 of CTA, 1975.
4. We have heard Shri V.B. Akolkar learned advocate for the appellants and Smt. Sundaram, learned DR for the Revenue. Shri Akolkar submitted that the imported item is not a part of industrial furnace falling under Heading 8417.90 which referred to parts of industrial or laboratory furnaces or ovens. But the material is used as lining material or construction material and not as a part, spare or component. It is his grievance that this submission was not considered by the lower authorities. Reliance on the term "Refractory" as appearing at page 887 of the Howleys Condensed Chemical Dictionary was also placed which is reproduced below -
"Refractory (1) An earthy ceramic material of low thermal conductivity that is capable of withstanding extremely high temperature (1650 - 2200°C) without essential change. There are three broad groups of these (a) acidic (silica, fireclay) (b) basic (magnesite, dolomite) and (c) amphoteric (alumina, carbon and silicon carbide). Their primary use is for lining steel furnaces, coke ovens, glass labs, and other continuous high temperature applications. They are normally cast in the form of brick and are sometimes bonded to assure stability. The outstanding property of these materials is their ability to act as insulators. The most important are fireclay (aluminium silicates) silica, high alumina (70-80% AI2 O3) mullite (clay sand); magnesite (chiefly MgO) dolomite (CaO Mg); forsterite (MgO-sand); carbon; chrome ore-magnesite; zirconia and silicon carbide.
(2) Characterising the ability to withstand extremely high temperature e.g. tungsten and tantalum are refractory earth ceramics and refractory mixtures".
Shri Akolkar further submitted that where a specific entry is available then it should be preferred to general heading. He referred to the following rulings -
Voltas Ltd. v. Collector of Customs [1991 (56) E.L.T. 569] Manipal Power Press [1991 (56) E.L.T. 556] Collector of Customs v. Premier Mills Stores [1992 (57) E.L.T. 197] Bharat Forge & Press Industries v. Collector of Customs [1990 (45) E.L.T. 525] Vardhaman Spinning & General Mills v. Collector of Customs, [1991 (53) E.L.T. 79]
5. Smt. Sundaram learned DR referring to the bill of entry, contended that the item both from the use and size is more specifically covered under Heading 9806 as it is not a general purpose item also. She contended that parts of machinery or equipments of Headings 84, 85, 86, and 87 come within Tariff Item 98 and not under general purpose item under Heading 6904. She contended that Notification No. 124/87 grants exemption to refractory brick and not to refractory tiles and hence the benefit cannot be extended. She also contended that the item is also not component parts of industrial furnace.
6. Countering the arguments of learned DR, Shri Akolkar learned advocate, contended that there is no difference between tiles and bricks.
7. We have carefully considered the submissions made by both the sides. The Asstt. Collector has considered the item as meant for industrial boiler furnaces and that industrial boiler furnaces fall under Chapter 84 of Schedule I to CTA 1975. He has applied Chapter Note 1 to Chapter 98 to classify the item under it.
Chapter 98 heading reads -
"Project imports, laboratory chemicals, passengers' baggage, personal importations by air or post; ship stores"
Note 1 of Chapter 98 reads :
"1. This chapter is to be taken to apply to all goods which satisfy the conditions prescribed therein even though they may be covered by a more specific heading elsewhere in this Schedule".
Heading 98.06 reads -
"Parts of machinery, equipment appliances, instruments and articles of Chapters 84, 85, 86, 89 and 90"
It has to be seen as to whether the item in question falls under Chapter Heading 8417.90 as part of 84.17 which reads as "84.17 Industrial or laboratory furnaces and ovens including incinerators, nonelectric 8417.90 Parts"
Note l(b) of Chapter 84 reads -
1. This chapter does not cover
(b) Appliances or machinery (for example, pumps) or parts thereof of ceramic material (Chapter 69) Shri Akolkar, advocate, has contended that the item is not a part of industrial furnace but it is used in lining material or construction material and that it is also not a part, spare or a component. In this context, reliance has been placed on the term 'Refractory' as appearing at page 887 of the Howleys Condensed Chemical Dictionary. The same is extracted above. Its primary use has been shown as for lining steel furnaces, coke ovens, glass labs and other continuous high temperature applications. It is further stated that the outstanding property of these materials is their ability to act as insulators. Therefore, from its uses, it cannot be said to be a part of industrial or laboratory furnaces. The department has not placed any material to show that the item is a part of industrial or laboratory furnace falling under 8417.90 or any other sub-heading of Chapter 84. The most significant point is that note l(b) of Chapter 84 excludes 'appliances or machinery (for example pumps) or parts thereof, of ceramic material (Chapter 69)'. Therefore, even if the item was considered to fall under Chapter 84, the note l(b) excludes parts of ceramic material of Chapter 69 from the Chapter 84. Therefore, the item not being a part of machinery, equipments, appliances, instruments and article of Chapter 84, the same cannot be brought under Heading 98.06; which specifically covers only those items described therein and falling under Chapters 84,85,86,89 and 90. Hence, the classification of the item under Heading 9806.00 is ruled out.
8. Now it has to be seen as to whether the item falls under Chapter Heading 6902.20. Chapter Note. 1 of Chapter 69 reads -
1. This Chapter applies to ceramic products which have been fired after shaping Headings Nos. 69.04 to 69.14 apply only to such products other than those classifiable in Heading Nos. 69.01 to 69.03 -
"69.02 reads as follows -
Refractory bricks, blocks, tiles and similar refractory ceramic constructional goods, other than those of siliceous fossil meals or similar earths."
The other sub-headings read -
6902.10 Containing by weight, singly or together more
than 50% of the elements Mg, Ca or Cr expressed
as MgO, CaO or C12 O3.
6902.20 Containing by weight more than 50% of alumina
(A12O3) of silica (Si O2) or of a mixture or
compound of these products.
6902.90 Other
The classification of item under Chapter 69 is well-founded but its fixation under further sub-headings 6902.10,6902.20 and 6902.90 is based on the criteria laid thereunder. The importer has not any material for such consideration. The lower authorities also have not looked into this aspect as they primarily based their decision on Note 1 of Chapter 98 and assuming the item to fall under Chapter 85. Therefore, it is but proper to remand the matter to the lower authorities to reconsider the correct sub-headings under Chapter 6902 on the basis of the criteria laid thereunder by calling for further information from the importer and also consider grant of benefit of the Notification No. 124/87-Cus., dated 1-3-1987, which they are claiming and grant consequential relief, if any.
Ordered accordingly.