1995 (3) TMI 193 - AT - Customs

Summary

Issues Involved:
1. Classification of the imported machine under sub-heading 8466.93.
2. Eligibility for the benefit of Notification No. 40/78-Cus.
3. Interpretation of the term "Jig Boring Machine" in the context of the notification.

Issue-wise Detailed Analysis:

1. Classification of the Imported Machine:
The appellants described the imported goods in Bill of Entry No. 0010521, dated 30-11-1992, as "JIG BORING MACHINE MODEL ZE 470A (Tool Room Precision Coordinate Jig Boring Machine)" and claimed classification under sub-heading 8466.93. The machine was examined and found capable of performing milling, drilling, and boring operations. The Assistant Collector and the Collector (Appeals) both held that the machine was a general-purpose machine tool and not exclusively a jig boring machine, thus denying the benefit of Notification No. 40/78-Cus.

2. Eligibility for the Benefit of Notification No. 40/78-Cus:
The appellants argued that the machine, despite performing multiple functions, was primarily a jig boring machine and should be eligible for the concessional rate of duty under Notification No. 40/78-Cus. The Assistant Collector and the Collector (Appeals) rejected this claim, stating that the notification was intended for machines performing only boring operations. The Collector noted that the machine could also be used for drilling, countersinking, reaming, and milling, making it a general-purpose machine tool.

3. Interpretation of the Term "Jig Boring Machine":
The appellants provided technical literature and definitions from various engineering dictionaries and publications to support their claim that the machine was a jig boring machine. They argued that jig boring machines inherently perform ancillary operations such as drilling and milling. The Assistant Collector and the Collector (Appeals) disagreed, stating that the notification's language was clear and only machines performing exclusive boring operations were eligible.

Majority Decision:
The majority decision, including the opinion of the President, held that the imported machine, being capable of performing multiple operations, did not qualify for the benefit of Notification No. 40/78-Cus. The decision emphasized that the plain meaning of the words in the notification should be followed, and the machine's ability to perform sophisticated, computer-precision operations excluded it from the scope of the notification.

Separate Judgment by Member (T):
Member (T) dissented, arguing that the machine was sold and recognized worldwide as a jig boring machine and that ancillary operations like drilling and milling were integral to its primary function of boring. He relied on technical literature and certificates from reputable institutions like CMTI, which supported the appellants' claim. He also pointed out that the DGTD's opinion indicated an ambiguity in the notification's wording, which should benefit the assessee.

Final Order:
In accordance with the majority decision, the appeal was dismissed, and the imported goods were held not entitled to the benefit of exemption Notification No. 40/78-Cus, dated 1-3-1978, vide Sl. No. 2 thereof. The impugned order was upheld, and the appeal was rejected.