JOY ICE CREAM Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners manufacture and sell ice cream. On 4th April, 1979 they were issued an import licence for a continuous freezer for use in the manufacture of ice cream. It arrived by air on 30th May, 1979. On 31st May, 1979 a bill of entry was filed which classified the freezer under item 84-15(1) of the Customs Tariff, 1975, upon the advice of the Customs appraisement department. For the purposes of countervailing duty it was classified under Tariff item 29-A(1) of the Customs Tariff. On 5th June, 1979 the petitioners wrote to the Assistant Collector of Customs and submitted that the freezer should be classified as dairy machinery under item 84.26. On 19th June, 1979 the Assistant Collector of Customs held that the freezer should be assessed under item 84.15(1) of the Customs Tariff and, for the purposes of countervailing duty under Tariff item 29-A(1). The petitioners preferred an appeal on 4th August, 1979. The Collector of Customs (Appeals) dismissed the appeal. He found that what had been imported was a continues ice cream freezer based on ammonia. Its instruction manual showed that the salient features of a refrigeration system like solenoid values and automatic expansion value were incorporated in the freezer and that it worked on a refrigeration system. The argument of the petitioners that Tariff item 29-A referred only to refrigerators or refrigerating appliances which were ordinarily sold or offered for sale as a ready assembled unit did not hold good since refrigerating devices which were not self-contained units but were designed to operate together either by direct expansion or by means of a refrigerating medium which was sold as such would also be covered under item 29-A. The freezer under consideration had the characteristics of a refrigerating device and low temperature therein was maintained in the freezing cylinder by the refrigerant which was used from outside. Against this order in appeal the petitioners presented a revision application to the Government of India. On 18th March, 1980 the application was rejected. In the order it was observed that the freezer being based on the refrigerating principle, fell under item 29-A. As regards the point that the freezer in question was not ordinarily sold or offered for sale as a ready assembled unit, it was observed that the leaflet itself indicated that it was capable of giving the ice-cream a creamy flavour which could be packed instantly. It was, therefore, obvious that the freezer was offered for sale as a ready assembled unit.

(2.) The petition challenges the order of the Assistant Collector, the order in appeal and the order in revision.

(3.) My attention was drawn by Mr. Rana, learned Counsel for the petitioners, to the averments in the petition which show that the freezer did not have either a compressor or a condenser and no refrigerator or refrigerating appliance could operate without a compressor or a condenser. The freezer as such could not be treated as a refrigerator or a refrigerating appliance. The freezer is started also to have no utility except as a part of an ice-cream making plant. There is no affidavit in reply which controverts these factual averments.