1991 (5) TMI 170 - AT - Customs

Summary

Issues Involved:
1. Classification of imported dies for plastic extruders under the correct Customs Tariff Heading.
2. Determination of whether plastic extruders are machine tools.
3. Classification of dies as interchangeable tools.

Detailed Analysis:

1. Classification of Imported Dies for Plastic Extruders:
The appellants claimed the imported dies should be classified under Heading No. 84.59(2) of the Customs Tariff Act, read with Central Excise Tariff Item No. 68, as component parts of plastic extruder machines. The Assistant Collector classified the goods under Heading No. 82.05(1) read with Central Excise Tariff Item No. 51A. The main contention of the appellants was that Heading 82.05 covers only interchangeable tools and dies for wire drawing and extrusion dies for metals, not for plastic extruders. They argued that the imported dies should be classified under Heading 84.59(2) as parts of plastic extrusion machines. The department maintained that the dies were classifiable under Heading 82.05 as interchangeable tools designed for fitment on plastic extruders.

2. Determination of Whether Plastic Extruders are Machine Tools:
The department argued that plastic extruders could be deemed as machine tools based on the definition provided in the Tool Engineers' Handbook and the CCCN Notes to Heading 82.05. They contended that plastic extruders, being machines designed for the production of plastic tapes, fall under Heading 84.59 and the dies used in such extruders should be classified under Heading 82.05 as interchangeable tools. The appellants countered this by arguing that plastic extruders for manufacturing tapes from materials like HDPE and Polypropylene could not be categorized as machine tools, as they do not carry out processes like turning, boring, drilling, grinding, or polishing of solid parts, especially metals.

3. Classification of Dies as Interchangeable Tools:
The appellants argued that the imported dies were not interchangeable tools as they were designed exclusively for use in plastic extruders for producing plastic tapes. They referenced the Tribunal's decision in the case of Purewell & Associates Ltd. v. Collector of Customs, Bombay, where die sets intended for power presses were held as non-interchangeable. The department argued that the use of the word "including" in Heading 82.05 enlarges its scope to cover other types of dies, relying on the Supreme Court's decision in Commissioner of Income Tax v. Taj Mahal Hotel. However, the Tribunal found that the dies in question were usable only for the manufacture of plastic tape and no other tool could perform the same function, thus they could not be deemed interchangeable.

Conclusion:
The Tribunal concluded that the imported dies were classifiable under Heading 84.59(2) as parts of plastic extruders for the manufacture of plastic tapes and could not be deemed as interchangeable tools for machine tools. The appeal was allowed, and the order appealed against was set aside with consequential relief to the appellants.