2008 (11) TMI 492 - AT - Central Excise

Summary

Issues involved: Classification of Air motors and hydraulic cylinders u/s Chapter CETA 8431 vs. Chapter 8412.

The dispute in the appeal centered around the classification of Air motors and hydraulic cylinders manufactured by the appellant. The Commissioner (Appeals) classified these products under Chapter CETA 8431, emphasizing their importance in the manufacturing of the appellant's loading and unloading machinery falling under Chapter 8429. The essentiality of these parts due to their special shape or design, rendering them incapable of use in any other machine, was a key point of contention.

Upon hearing both sides, the appellant's consultant argued that the products should be classified under Chapter 8412 of the CETA. He relied on Chapter Note 2(a) which states that parts included in Chapter 84 are to be classified in their respective headings. The consultant pointed out that Heading 84.12 specifically covers engines and motors, supporting his argument with relevant tariff entries from the Customs Tariff Act. In contrast, the Departmental Representative contended that the Commissioner's classification was correct, emphasizing that the appellant's motors and cylinders were not usable with any other machinery, a criterion for classification under Chapter 84.12.

The Tribunal noted the consultant's reliance on the Customs Tariff Act for classification under CET, highlighting the distinction between Chapter Heading 84.12 in the Customs Tariff and the Central Excise Tariff. The absence of the term 'cylinder' in the CETA was also observed. Referring to previous cases, including Textile Bearings (KCI) Pvt. Ltd. and Hydraulic Engineers, where Chapter Note 2(a) was applied, the Tribunal emphasized the irrelevance of end use in classification under the Tariff Entry. It was concluded that the modified motors should be classified under the general heading covering engines and motors, while the hydraulic cylinders fell under Heading 84.31 of the Central Excise Tariff due to the lack of evidence to classify them as engines.

The appeal was decided in favor of classifying the appellant's products under the respective headings based on the analysis of the Customs and Central Excise Tariffs. The judgment was pronounced on 26-11-2008.