HINDUSTAN MOTORS LTD. Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) This appeal arises from Order -in -Appeal No. C. Cus. 999/98, dated 28 -8 -98 by which the learned Commissioner (Appeals) has held that the filter element imported by the appellants are classifiable under sub -heading 7019.39 of the First Schedule of the Customs Tariff Act as against the classification claimed by the appellants under sub -heading 8421.99. It is the contention of the appellants that they are manufacturers of Power Shift Transmission. One of the critical component part of power shift transmission is specially designed filters in order to ensure high performance efficiency of the automatic transmission. These filters are again filled with specially designed cartridge elements i.e. filter element cartridges to prevent dirt/dust particles so that the oil medium used inside the transmission i.e. clear resulting in high performance efficiency. It is stated by them that the cartridge elements are made of proprietary inorganic Resin bonded synthetic glass fibre. The imported item bore part Nos. 23040989 and 23049374 and imported against valid purchase order from the supplier from Singapore. The Bill of Entry was filed along with invoice details describing the item as a part of filter system. The technical details and technical write up, catalogue were also furnished to show that the item is a part of purifying machinery classifiable under sub -heading 8421.99 as "other" under the heading "Parts : Of centrifuges, including centrifugal dryers". It is contended that the item being custom made as part cannot be classified as glass fibres under the Heading 7019.39 under the heading 'parts'. It is contended that the Tribunal remanded the matter with specific direction to consider the claim of the appellants for classification under Heading 8421.99 in the light of the literature produced. However, both the authorities have failed to do so. It is also contended that Section Note 2(a) and (b) of Section XVII clearly lays down that parts are required to be classified under the heading under which they fall in the respective headings of Chapter 84. In Note 2(b), the note clarifies that other parts suitable for use solely or principally with a particular kind of machine is required to be classified under the respective heading to which machines are classified. It is stated that MSN explanatory notes under Chapter Heading 84.21 at page 1282 does not deal with this aspect of the matter and deals only with 'filter blocks of paper pulp falling under Chapter Heading 48.12 and it refers to other filtering element (ceramics, textiles, felts, etc.) are classified according to their constituent material. It is submitted that it does not refer to parts which are required to be classified on the basis of Note 2(a) and (b) of Section XVI.

(2.) Ld. Consultant arguing for the appellants submitted that the classification of filer parts were considered as parts as in the case of Lucas TVS v. CCE, 2002 (146) E.L.T. 226. He further relied on the judgment rendered in the case of Shaw Wallace Gelatines Ltd. v. CCE, Bhopal, 2001 (137) E.L.T. 707 (T -Del.) wherein also the filter pads/mesh having held to be part of the machine to be classified under sub -heading 8421.90. He further relied on the Final Order No. 1643/98 [1999 (107) E.L.T. 112 (T)] in the case of Titanium Equipments and Anode Mfg. Co. Ltd. wherein also Membrane Elements have been held to be a part of filtering and purifying system.

(3.) Ld. DR reiterated the departmental view and the HSN Explanatory notes appearing at page 1282.