1999 (9) TMI 186 - AT - Central Excise

Summary

Issues:
1. Whether certain parts manufactured by the appellants are entitled to the benefit of SSI exemption Notification No. 1/93.
2. Whether the parts in question are considered as parts of refrigerating and air-conditioning appliances and machinery.

Analysis:
1. The lower appellate authority determined that the parts in question, including fly wheels, pulley, suction and discharge stock valve, oil separators, and accumulators, are not classified as parts of refrigerating and air-conditioning appliances or machinery. This conclusion was based on a Trade Notice and a Board's Tariff Advice, which specified that certain accessories are not components of compressors and condensers unless they are essential for the working of the compressors or condensers. The Revenue did not contest the essentiality of these parts but argued that since the appellants manufacture other items of refrigeration plants, the end use of these goods must be for refrigerating and air-conditioning machinery. However, the Tribunal found that there was no evidence to support this inference and clarified that the exclusion under the Notification only applies to parts and accessories of refrigerating and air-conditioning appliances and machinery, not other parts used in related industries like cold storages. The Tribunal upheld the lower authority's decision, emphasizing that the Trade Notice and Board's circular are binding precedents and dismissed the Revenue's appeal.

2. The Tribunal highlighted that the Revenue failed to demonstrate that the parts in question were exclusively used in refrigerating and air-conditioning appliances and machinery. It was noted that while these parts may fall under Chapter 84, they cannot be automatically classified under Tariff Heading 84.18. The Tribunal emphasized that the exclusion under the Notification pertains specifically to parts and accessories of refrigerating and air-conditioning appliances and machinery. The Tribunal held that the Trade Notice, supported by the Board's circular, clearly outlined the criteria for classifying parts as essential components, and this interpretation was legally sound. Consequently, the Tribunal affirmed the lower authority's decision, stating that the Revenue's inference regarding the exclusive use of these parts in refrigerating and air-conditioning machinery was unfounded. The Tribunal concluded that the impugned order was legally and factually correct, leading to the dismissal of the Revenue's appeal.