1990 (7) TMI 208 - AT - Customs

Summary

Issues Involved:
1. Classification of the machine.
2. Extension of project importation concession.

Detailed Analysis:

1. Classification of the Machine:

The appellants contested the classification of the imported "Writegen Remixer Machine" under various headings of the Customs Tariff Act (CTA). The primary issue was whether the machine should be classified under Heading 84.23, 84.56, or 84.59.

Appellants' Argument:
- The machine is a sophisticated device for road excavation, laying mixed material, and rolling the road surface, all in one compact piece.
- It performs multiple functions: heating, excavating, mixing, levelling, and tamping.
- They claimed that the machine should be classified under Heading 84.23 or 84.56, invoking Rule 3(a) of the Rules for Interpretation of the First Schedule to the Customs Tariff Act, 1975, which states that a specific heading should be preferred to a general one.
- They argued that Heading 84.23 covers three of the machine's main functions: excavating, levelling, and tamping, while Heading 84.56 covers its mixing function.
- They contended that Heading 84.59 is a residuary heading and should only be applied if the machine cannot be classified under any other specific heading.

Respondents' Argument:
- The machine performs individual functions of road making, which are specifically mentioned in the CCCN Explanatory Notes under Heading 84.59.
- The machine does not produce a commodity, so it should not be classified under Heading 84.59(2).
- They argued against classification under Heading 84.23, stating that the machine's functions of scarifying and mixing do not align with the functions covered under Heading 84.23.

Tribunal's Analysis:
- The Tribunal considered the machine's primary function, which is mixing, and noted that the other functions are complementary.
- According to Section Note 3 of Section XVI BTN and the Customs Tariff Act of India, composite machines should be classified based on their principal function.
- The Tribunal found that the machine's primary function is mixing, which aligns with Heading 84.56. This heading covers machinery for mixing mineral substances with bitumen for preparing bituminous road-surfacing materials.
- The Tribunal concluded that Heading 84.56 is more appropriate for the machine's classification, as it specifically covers the machine's primary function of mixing.

Conclusion:
- The Tribunal set aside the classification under Heading 84.59(1) and upheld the classification under Heading 84.56. The appeal was allowed with consequential benefits to the appellants.

2. Extension of Project Importation Concession:

Appellants' Position:
- The appellants initially contested the extension of the project importation concession but later decided not to press for this concession, limiting their appeal to the disputed classification issue.

Conclusion:
- Since the appellants did not pursue the extension of the project importation concession, the Tribunal did not address this issue further.

Summary:
The Tribunal primarily focused on the classification of the "Writegen Remixer Machine." The appellants argued for classification under Heading 84.23 or 84.56, while the respondents supported classification under Heading 84.59. The Tribunal concluded that the machine's principal function is mixing, which falls under Heading 84.56, and thus set aside the classification under Heading 84.59(1), allowing the appeal with consequential benefits to the appellants. The issue of the project importation concession was not pressed by the appellants and was not further addressed.