2016 (9) TMI 888 - AT - Central Excise

Classification - Operation theater lights - Whetehr they are to be classified under Central Excise Tariff heading 9018.00 as Instruments and Appliances used in medical, surgical, dental or veterinary sciences as per assessee or under CETH 9405 which deals with lamps and lighting fittings, including search lights and spot lights not elsewhere specified as per Department - Held that - these specialized lamps have shadowless operation, heat defusing capacity and also colour correction capabilities. Therefore, we are in agreement with the lower authority that these lamps are specially designed and made to be used only in operation theatres. We also found that the reliance placed by the Commissioner (Appeals) on the observation of Hon ble Supreme Court in the case of M/s Metagraph (P) Ltd. vs. CCE 1996 (11) TMI 68 - SUPREME COURT OF INDIA is appropriate. Therefore, they are appropriately classified under CETH 9018.00. - Decided against the Revenue

Summary

Issues: Correct classification of operation theatre lights under Central Excise Tariff heading 9018.00 or 9405.

Analysis:
1. The appeal concerns the correct classification of operation theatre lights, with the Department disputing the classification claimed by the respondents under Central Excise Tariff heading 9018.00 as medical instruments and appliances.
2. The Department argued that the lights should be classified under CETH 9405 for lamps and lighting fittings, contending that they are essentially lighting systems with spotlights features and not medical equipment.
3. The Original Authority classified the lights under heading 9405, denying the exemption available to medical equipment under Notification No. 10/2003 dated 01/3/2003. However, the Commissioner (Appeals) set aside this decision and allowed the appeal, prompting the Department to file the current appeal.
4. The Department maintained that even though the lights are designed for operation theatres, they do not qualify as medical equipment or apparatus, specifically electro medical apparatus, and thus should not be classified under heading 9018.00.
5. The respondents relied on a Tribunal decision in a similar case, arguing that operation theatre lamps are specially designed for medical use and should be classified under heading 90.18. They highlighted that the Supreme Court dismissed the Department's appeal against this decision on monetary grounds, keeping the legal question open.
6. The Tribunal examined the product literature and observed that the lights were specifically designed for medical purposes, with features such as focusing knobs, autoclavable handles, and shadowless, heatless, and color-corrected light for surgical precision.
7. The Tribunal agreed with the lower authority's conclusion that the lights were specialized surgical equipment falling under heading 90.18, as they possess features beyond standard spotlights and are exclusively used in operation theatres.
8. Citing a previous Supreme Court judgment, the Tribunal found no merit in the Department's appeal, ultimately rejecting it and upholding the classification of the operation theatre lights under Central Excise Tariff heading 9018.00 as medical and surgical appliances.

This detailed analysis comprehensively covers the issues involved in the legal judgment regarding the classification of operation theatre lights under the Central Excise Tariff, providing a thorough examination of the arguments presented by both parties and the Tribunal's reasoning for its decision.