1996 (10) TMI 196 - AT - Central Excise

Summary

Issues: Classification of Techogenerator assembly, Excitation coils, and Eddy current clutches under Central Excise Tariff Item No. 30D as parts of electric motors or under Tariff Item No. 68.

In this judgment by the Appellate Tribunal CEGAT, New Delhi, the issue revolved around the correct classification of Techogenerator assembly, Excitation coils, and Eddy current clutches under the Central Excise Tariff. The Department appealed against the order of the Collector (Appeals), Madras, which classified the products under Tariff Item No. 68 instead of Tariff Item No. 30D as parts of electric motors. The Department argued that the items had varied applications beyond electric motors, such as regulating speed in railways. The Assistant Collector had classified the products under T.I. 68 based on their multiple applications. However, the Collector (Appeals) relied on the party's submission that Techogenerator assembly is part of Eddy current drive, which is a part of an electric motor. The party contended that these items were not essential parts of electric motors and had diverse applications beyond motor usage.

The Tribunal analyzed the nature and functions of the products in question. It was noted that Techogenerator assembly, Excitation coils, and Eddy current clutches had various applications beyond electric motors, including as speed transducers, position sensors, and for digital processing. The products were found to be suitable for speed indication control and speed switching functions. The Tribunal emphasized that these items were not sold or known as parts of electric motors in trade parlance. Technical opinions obtained indicated that these items were accessories for A.C. motor variable speed and not essential parts of the motor itself. The Tribunal observed that the party did not dispute the varied industrial applications of the products.

The Tribunal considered the catalogue submitted by the party, which highlighted the industrial applications of Eddy current adjustable speed drives, including fan drives, centrifugal pumps, compressors, constant torque loads, and frequency changes and stabilizers. Despite the presence of a techometer generator and the coupling of the Eddy current clutch with an electric motor, the Tribunal focused on how the items were presented for assessment at the time of clearance. It was noted that the items were being cleared separately without induction motors for various configuration applications, indicating that they were not primarily or principally meant to be used as essential parts of electric motors. Therefore, the Tribunal set aside the order of the Collector (Appeals) and reinstated the original classification under Tariff Item No. 68 for the Techogenerator assembly, Excitation coils, and Eddy current clutches.