1986 (1) TMI 101 - HC - Central Excise

Summary

Issues:
1. Classification of bolts and nuts under Central Excise Tariff Item No. 52.
2. Interpretation of Notification No. 99/1971 for exemption of motor vehicle parts and accessories.
3. Application of previous legal judgments to determine classification of products under the Central Excise Tariff.

Analysis:
The judgment revolves around the classification of bolts and nuts under Central Excise Tariff Item No. 52. The petitioner, a motorcycle manufacturer, contended that the items in question, though used in the assembly of motorcycles, should be exempt from duty under Notification No. 99/1971, as they are essential parts and accessories of the motorcycles manufactured by them. The Revenue argued that the items met the description of bolts and nuts under Entry 52 and should be levied accordingly.

The court considered the petitioner's argument that the items were specifically manufactured as parts of their motorcycles and should be exempt under the notification. The Revenue relied on legal precedents, including a Supreme Court decision, to support their classification of the items as bolts and nuts under Entry 52. The court analyzed the intent of the Parliament in taxing only specified items under the amended Entry 34A, which included parts and accessories of motor vehicles.

Ultimately, the court found that the items in question, despite being described as bolts and nuts, were integral parts of the motorcycles manufactured by the petitioner. They were specially manufactured to specification and served a specific function in the operation of the motorcycles. Therefore, the court concluded that the items should be treated as parts and accessories of motor vehicles under Item No. 34A of the Central Excise Tariff, rather than under Item 52. The writ petition was allowed, and the duty paid under protest was ordered to be refunded to the petitioner.