1986 (9) TMI 94 - AT - Customs

Summary

Issues:
Classification of "chamber and conduit insulators" used in air blast circuit breakers under sub-heading (1), (3), or (7) of Item No. 85.18/27 of the Customs Tariff Act, 1975.

Detailed Analysis:

1. Conflict of Decisions:
The reference to a five-Member Bench was due to a conflict between two Tribunal decisions regarding the classification of insulators used in air blast circuit breakers. The decisions in question were Collector of Customs v. Bharat Heavy Electricals and Collector of Customs v. M/s Tata Merlin and Gerin Ltd.

2. Classification Issue:
The main issue revolved around whether "chamber and conduit insulators" imported for use in air blast circuit breakers of 130 K.V. should be classified under sub-heading (1), (3), or (7) of Item No. 85.18/27 of the Customs Tariff Act, 1975.

3. Previous Decisions:
In previous cases, it was ruled that porcelain insulators for minimum oil circuit breakers did not fall under sub-item 85.18/27(3) and required further evidence for classification. In another case, insulators were classified under sub-item 85.18/27(3) based on the specific items in question.

4. Adverted Decisions:
Other Tribunal decisions were referred to, including cases where insulators were classified under sub-item (1) instead of (3) and the controversy over the applicability of a Customs Notification to insulators, actuators, and contacts.

5. Legal Arguments:
The Respondent argued that the goods should be classified under sub-item (1) based on the description in the invoice and the Rules for interpretation of the Schedule. The Appellant contended that the goods were insulators and should be classified under sub-item (3) or (7) as part of electrical apparatus or for use in a transmission system.

6. Interpretation and Conclusion:
The Tribunal analyzed the relevant headings and sub-items, concluding that the insulators in question should be classified under sub-heading (1) of Item No. 85.18/27 and not under sub-headings (3) or (7) due to the specific mention of insulators and the nature of the goods as per the description and usage.

7. Final Decision:
The Tribunal held that the insulators used in air blast circuit breakers are to be classified under sub-heading (1) of Item No. 85.18/27 of the Customs Tariff Act, 1975, based on the specific characteristics and usage of the goods, as opposed to sub-headings (3) or (7) as contended by the parties.