1988 (5) TMI 219 - AT - Central Excise

Summary

Issues: Classification of imported valves under the Customs Tariff Act

In this judgment by the Appellate Tribunal CEGAT, New Delhi, the issue revolves around the classification of imported valves under the Customs Tariff Act. The goods in question are a consignment of tube, valve-type TR-78A imported at the port of Calcutta and assessed under 64.61(1) by the Custom House. The main contention is whether these valves, made of copper alloy, should be classified under a specific item in the tariff or under a residuary item.

The judgment begins with the absence of the importers during the hearing, leading to the learned SDR supporting the order of the Collector of Customs (Appeals). The Collector had classified the valves under a residuary item, 64.61(1), based on the argument that the valves were not made of materials specified under Heading 84.61(2) for corrosion resistance.

The Appellate Tribunal disagreed with the Collector's assessment, emphasizing that the heading covers valves made of corrosion-resisting materials such as stainless steel, nickel, monel, etc. The Tribunal clarified that the list of materials provided is illustrative and not exhaustive, and valves made of materials similar to those listed, such as copper alloys, should also be included under the same heading.

Furthermore, the Tribunal refuted the Collector's argument that the valves were not lined with rubber or other corrosion-resisting materials, stating that this point was irrelevant to the classification. The Tribunal highlighted that any alloy of nickel, if a corrosion-resistant material, should be considered under the relevant heading.

The judgment also addressed the Collector's consideration of trade practices in classifying the valves as inner tube valves rather than valves made of corrosion-resisting materials. The Tribunal emphasized that legal definitions take precedence over trade practices and cited a Supreme Court judgment to support this principle.

Additionally, the Tribunal distinguished the present case from a previous case cited by the SDR, emphasizing that the valves in question were non-return valves due to their function of blocking the reversal of airflow, unlike the valves discussed in the cited case.

Ultimately, the Tribunal directed the assessment of the valves to be made under Heading 84.61(2) as valves made of corrosion-resisting materials, rejecting the classification under the residuary item. The judgment concluded by emphasizing the corrosion resistance of the valves, made of a copper alloy, to the fluid passing through them, supporting their classification under the specific tariff heading.