1992 (5) TMI 99 - AT - Customs

Summary

Issues:
Classification of imported bobbins under Customs Tariff Heading 8446.29 or Heading 9806.00.

Detailed Analysis:

1. The appellants imported improved heavy Texplooms along with grippers and bobbins for producing felts for paper making machines. They claimed assessment of bobbins as parts of the loom system under sub-heading 8446.29. However, Customs authorities assessed the bobbins under Heading 9806.00. The Assistant Collector rejected the refund claim, and the appeal to the Collector (Appeals) was also dismissed based on Note 1(c) to Section XVI and Note 1 to Chapter 98. The appellants argued that the Collector's interpretation overruled Note 2 to Section XVI and was against the rule of harmonious construction of statutes and interpretative rules (Rule 3) as per the Supreme Court's decision in Dunlop India Ltd. v. Union of India.

2. The appellants contended that the disputed bobbins should be classified under Heading 8446.29 based on Note 2 to Section XVI. They argued that the specific Heading should prevail over the general Heading 98.06. However, the Revenue supported the Collector (Appeals) decision, citing Note 1 to Chapter 98, which mandates classification under Heading 98.06 for parts of machinery, even if covered by more specific headings elsewhere in the Schedule. They relied on the decision in Saurashtra Chemicals Porbander v. Collector of Customs.

3. The Tribunal examined the relevant Section and Chapter Notes in the Customs Tariff. It noted that Note 1 to Chapter 98 directs classification under Heading 98.06 for parts of machinery covered by more specific headings elsewhere. The Tribunal emphasized that statutory Section and Chapter Notes are binding and have overriding force. It concluded that the disputed bobbins, being excluded from Section XVI per Note 1(c), were correctly classified under Heading 98.06.

4. The Tribunal rejected the appellants' argument that the bobbins should be classified under Heading 8446.29, emphasizing the applicability of Note 1 to Chapter 98. It found no merit in the appellants' contention that the disputed goods did not meet the conditions prescribed in Chapter 98 for classification under Heading 98.06. The Tribunal upheld the Collector (Appeals) decision and dismissed the appeal.

5. In light of the above analysis and the statutory provisions, the Tribunal affirmed the classification of the disputed bobbins under Heading 9806.00 and upheld the decision of the Collector (Appeals).