1994 (3) TMI 211 - AT - Customs

Summary

Issues Involved:
1. Correct classification of the goods described in the Bill of Entry.
2. Whether the goods are parts or consumables.
3. Applicability of Note 2(b) of Chapter 90.
4. Exclusion from Chapter 76 based on Note (d) of Chapter 76.
5. Applicability of Notification No. 65/88-Cus.

Detailed Analysis:

1. Correct Classification of the Goods:
The primary issue in this appeal is the correct classification of the goods described in the Bill of Entry as "Densitometers, TLC Aluminium Sheets Silica Gel 60 F 254." The lower authorities classified the goods under sub-heading 7607.19 for customs duty and under Heading 7607.40 for additional duty of Excise and Special Excise Duty. The adjudicating officer held that the goods are not Chromatographs but are used in Densitometer, and thus, Heading 9027.90 does not cover Densitometer or its parts/accessories or consumables. The Collector also did not agree with the importer's contention, stating the goods are "Consumables" in the Chromatography process.

2. Whether the Goods are Parts or Consumables:
The appellants argued that the goods, being Aluminium Sheets pre-coated with Silica Gel and Fluoroscence Indicator, have acquired special characteristics making them suitable for use solely and exclusively in Chromatograph, thus classifiable under Heading 9027.20. They contended that the goods are parts of the Chromatograph, not consumables, as they perform a vital function in blood analysis. The Collector's analogy comparing the goods to ink or writing paper for a fountain pen was contested by the appellants, who argued that the goods are not Aluminium Sheets simpliciter due to their pre-coating.

3. Applicability of Note 2(b) of Chapter 90:
The appellants relied on Note 2(b) of Chapter 90, which states that parts/accessories suitable for use solely or principally with a particular kind of instrument of any heading of Chapter 90 are to be classified under that heading. They argued that the goods are Basic Assemblies for Thin Layer Chromatography, known in trade parlance as TLC Sheets, and thus should be classified under Heading 9027.20. The lower authorities did not examine Note 2(b) in their classification decision.

4. Exclusion from Chapter 76 Based on Note (d) of Chapter 76:
The appellants argued that the goods are not Aluminium foil simpliciter due to their pre-coating with absorbent material, thus acquiring characteristics suitable for use solely with Chromatograph, which excludes them from Chapter 76. They referred to Note (d) of Chapter 76, which states that plates, sheets, strips, and foils with patterns that assume the character of articles or products of other headings are excluded from Chapter 76. The appellants contended that the goods have assumed the character of an article, thus falling under Chapter 90.

5. Applicability of Notification No. 65/88-Cus:
The appellants also mentioned that Notification No. 65/88-Cus. has not been dealt with by the Collector (Appeals) and that the Assistant Collector erred in denying the benefit on the ground that the Densitometer referred to therein is for medical purposes. However, the appellants did not press for the claim of the benefit of the Notification No. 65/88 during the appeal.

Conclusion:
The Tribunal concluded that the goods in question are essential parts of the Chromatograph, as they perform the primary function of blood analysis. The goods have assumed the character of an article, thus excluding them from Chapter 76 based on Note (d) of Chapter 76. Applying Note 2(b) of Chapter 90, the goods are classified under Heading 9027.20 of the Customs Tariff Act. The appeal was allowed in favor of the appellants.