1995 (11) TMI 139 - AT - Central Excise

Summary

Issues involved: Classification of GIC SILO Systems under different headings and rate of duty applicable.

Classification under Heading 84.36:
- Appellants argued that the product falls under Heading 84.36 as "Other agricultural machinery" for storage of grains and oil seeds, with features for grain handling and preservation.
- Contention supported by classification of agricultural machinery into different types, including post-harvesting machinery under Heading 84.36.
- Emphasized the product's use by farmers and agricultural cooperatives, with additional accessories like temperature sensing devices and grain cleaners.

Alternative Classification under Heading 84.37:
- Appellants also proposed classification under Heading 84.37 for agricultural machines used in milling industry, citing the complex system for grain preservation and handling.
- Listed main customers as various mills in the milling industry, supporting the argument for classification under Heading 84.37.
- Stated that the product is usable by both farmers and industrial units, making it eligible for classification under Heading 84.37 or 84.36.

Department's Opposition and Residuary Entries:
- Department opposed the classification under Heading 84.36 or 84.37, arguing that the product is a storage system not covered by specific headings for agricultural machinery.
- Contended that the product's high cost and industrial use make it ineligible for classification as agricultural machinery.
- Asserted that the product should be classified under Heading 84.38 as machinery not specified elsewhere or under Heading 84.79 for machines with individual functions.

Tribunal's Decision:
- Tribunal observed the product's complex system with multiple functions beyond simple grain storage, suitable for use by agriculturists and the milling industry.
- Classified the product under Heading 84.37 for machinery used in the milling industry, considering its principal use and customer base.
- Rejected the Department's contentions, stating that Heading 84.36 or 84.37 was appropriate, rendering residuary entries 84.78 and 84.79 irrelevant.
- Affirmed the appellants' entitlement to exemption under Notification No. 111/88 based on the classification decision.
- Disposed of the appeals in favor of the appellants based on the classification under Heading 84.37.