Availability of exenption for seats for day/sleeper carriages manufactured for Railways under Notification No. 61/86 dated 10-2-1986 as amended - regarding - Central Excise - 15/90-CX.1

Availability of exenption for seats for day/sleeper carriages manufactured for Railways under Notification No. 61/86 dated 10-2-1986 as amended - regarding Circular No. 15/90-CX.1 Dated 7-5-1990 [From F. No. 13/2/90-CX.1] Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Availability of exenption for seats for day/sleeper carriages manufactured for Railways under Notification No. 61/86 dated 10-2-1986 as amended - regarding A doubt has been raised whether steel seats/berths manufactured for use in the Railway Carriages are eligible for exemption under Notification No.61/86 dated 10-2-1986. 2. It has been brought to the notice of the Board that a particular unit in Madras Central Excise Collectorate was being denied of the said exemption on the ground that while the description against heading 94.01 as found in the tariff, is seats (whether or, not convertible into beds) the notification for exemption doesn't contain identical expression. The description in the tariff is different from the description in the notification, in the sense that out of the goods that fall within the tariff heading 94.01 only the items falling under description given in the notification will be eligible for exemption. It is not that the entire goods falling under tariff heading 94.01 would be entitled for exemption. Out of the goods described in the tariff, only steel seats and chairs made partly or fully of steel are entitled, for the exemption benefit. In this particular case, the goods manufactured namely berths do not fall within the description given in the notification which mentions only steel seats and chairs. If the intention was to cover all seats whether or not convertible into beds, in the exemption, then this would certainly have been mentioned in the notification also, but this is not the case. 3. The matter has been further examined in the Board. The goods under dispute have already been classified under heading 94.01 as "seats" only; Whether the seats are convertible into beds or not is immaterial for classification under 94.01. What is relevent is that the goods should be seats. Having held the goods as "seats" it is illogical thereafter to deny them the exemption which is available for seats if the following conditions are fulfilled as per the Notification No. 61/86. (i) The seats should be made partly or wholly of steel. (ii) The seats are designed for use in automobiles, railway carriges and air-crafts, and (iii) The seats should be classifiable under heading 94.01, 94.02 or 94.03. 4. There is no doubt that the 'bottom berth' in passenger Railway Coach is used mainly as a seat for seating the passengers and only during night it is used as berth/bed. Evidently it is first and foremost a seat only and it is correctly so held by the proper officer, as falling under heading 94.01. .They also fulfill the conditions prescribed in the notification. The middle and top berths are exactly similar in nature to bottom berth, which is considered as "seat". These are a kin to each other. By application of Rule 4 of the interpretative Rules the middle and top berths could be considered as akin to bottom berth, which is a "seat". 5. In view of the above it has been decided by the Board that the goods in question are correctly classifiable under heading -94.01 and eligible for exemption under Notification No. 61/86 dated 10-2-86 as seats of steel. 6. This may be brought to the notice of the field formation.