1996 (9) TMI 390 - AT - Central Excise

Summary

Issues:
1. Eligibility for exemption under Notification No. 55/75-C.E. for goods not exclusively used for agricultural purposes.

Detailed Analysis:

1. The appeal in question involved the consideration of whether goods like pick axes, beaters, powrah/hoe/spade, shovels, and crow-bars, which were not exclusively used for agricultural purposes but had multiple applications, were eligible for exemption under Notification No. 55/75-C.E., dated 1-3-1975.

2. The goods in question were classifiable under Item No. 68 of the Central Excise Tariff, which exempted agricultural implements and parts thereof from excise duty under the said notification. However, the exemption did not apply to power-operated agricultural implements or implements designed for use with tractors or power tillers.

3. The appellant argued that despite the goods being capable of other uses, their predominant use was for agricultural purposes, making them eligible for the exemption. Reference was made to previous decisions where goods commonly used for agricultural purposes were considered agricultural implements.

4. The Revenue, represented by Shri M. Jayaraman, maintained the denial of exemption based on the goods' capability for other uses, as stated in the order of the Collector of Central Excise (Appeals).

5. The Tribunal analyzed the matter and noted that the goods were indeed used for agricultural purposes and were not excluded from the exemption under the relevant notification. Therefore, the exemption could not be denied solely based on the goods' potential for non-agricultural uses.

6. Citing legal precedents, including the case of Engineering Traders v. The State of Uttar Pradesh, the Tribunal emphasized that the key factor in determining an agricultural implement was not exclusive use but common agricultural usage directly connected to agricultural operations.

7. Referring to decisions from different High Courts, such as the Madras High Court and the Mysore High Court, which classified similar tools as agricultural implements, the Tribunal concluded that the Collector of Central Excise (Appeals) had erred in denying the exemption.

8. Consequently, the Tribunal allowed the appeal filed by M/s. TISCO, holding that the goods in question, despite their potential for various uses, were eligible for exemption under Notification No. 55/75-C.E.