1989 (1) TMI 262 - AT - Customs

Summary

Issues:
Classification of imported goods under tariff headings 85.03 and 85.18/27(1) CTA.

Detailed Analysis:

Issue: Classification of imported goods
The appeal was against the order of the Collector of Customs (Appeals), Madras, regarding the classification of imported goods described as film lined electrodes for batteries. The importers claimed the assessment of the goods under heading 85.18/27(1) CTA, while the customs authorities classified them under heading 85.03 CTA. The dispute revolved around whether the goods were to be considered as battery carbons or components of primary cell batteries.

The revenue contended that the goods imported were composite articles, not battery carbons, as they consisted of a zinc sheet with a carbon coating and paper lamination. The department argued that just having a carbon coating did not make the article a battery carbon, and the goods were more than a carbon electrode. The respondents, on the other hand, argued that the goods should be classified as carbon electrodes under heading 85.18/27(1) CTA due to the functional role of the carbon layer in the generation of electricity in the cell.

The respondents relied on interpretative rules 2(b), 3(a), and 3(b) to support their classification plea. However, the Tribunal found that the goods were not made of a mixture of carbon with something else but were composite articles consisting of a carbon layer, zinc sheet, and paper lamination. Therefore, the plea for applying interpretative Rule 2(b) was not accepted, and the goods were to be classified according to interpretative Rule 3. The Tribunal concluded that the imported goods were more akin to a complete cell without the jacket, constituting a component part of the primary cell, and thus should be classified under heading 85.03 covering primary cells and parts thereof.

In light of the above analysis, the Tribunal held that the lower authority's order was not legally sustainable and set it aside, allowing the appeal of the Revenue.

This detailed analysis of the classification issue highlights the arguments presented by both parties, the reliance on interpretative rules, and the Tribunal's reasoning for reclassifying the imported goods as components of primary cell batteries under a different tariff heading.