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TMI Blog1989 (11) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... e manufacture of Cast Iron Spun Pipes and the import was completed in 22 parts. Shipments were spread over a period of about three years from 1965. As this was imported under contract procedure, the Assistant Collector of Customs made preliminary assessment directing payments of duty as demanded subject to reconciliation at the time of final assessment. 3. The Assistant Collector of Customs, Madras directed the appellant to file a certificate of final payment with reconciliation statement in a specified form showing the name of vessel, bill of entry and date and FOB value, insurance, landing charges, total assessable value, rate of duty, duty payable, duty-paid, refund and recovery. In response to this direction the appellant filed the reconciliation statement showing the duty payable, the duty paid and the excess refundable to them under relevant Customs Tariff Schedule of the year 1965-66. Another statement was also filed in response to letter dated 9-3-1968 from the Assistant Collector of Customs, Madras. The extracts of the statements have been filed as part of record. On 21-7-1982 the Asst. Collector of Customs had issued a cheque for Rs. 50,764.76 as refund due to them. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Collector of Customs (Appeals), Madras and the Appellate Collector of Customs held that the contentions of the appellant are not tenable and that their manufacture of Cast Iron Spun Pipes do not attract the exemption Notfn. No. 117 dated 20-8-1965 for the following reasons: (a) In the 57th Issue of the Tariff Cover 72(15) to 72(24) and 72(25) ICT there are two notifications: (i) Notification No. 117 dated 20-8-1965; (ii) Notification No. 104 dated 6-6-1966 By Notification 117/65 goods falling under 72(15) to 72(25) ICT are exempt from duty as is in excess of 27 % ad valorem. By the issue of amended Notification 104/66, the earlier Notification No. 117/65 automatically stood cancelled. (b) The Collector of Customs (Appeal) has taken an expert opinion drawing attention to the write-up given by the Works Manager of the Appellant-firm and considered the explanatory notes under heading 84.43 to 45 of CCCN for the term metal working machinery figuring in Item No. 72(17) ICT. The Collector has held that metal working generally comes under two processes. (1) Metal cutting process; (2) Metal forming process. In metal cutting process a specified tool is used in such a way ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nes will be excluded from the scope of Tariff Item 72(17) under definition metal working machinery and this is a clear mis-conception of fact and not supported by any definition of the term to arrive at a decision. The rejection of claim is not based on relevant materials and thereby arbitrary; (e) The appellant had filed a write-up given by the Works Manager of the manufacturing Unit who is a technical officer concerned with the working of the machinery and in the absence of any other counter opinion by any experts on the manufacturing process through the machinery imported, the evidence of the Works Manager ought to have been accepted; (f) Even though the High Court had directed a de novo enquiry for the claim of refund by considering the merits of the claim, the matter was not taken up by the appropriate assessment authority; (g) The finding of the Collector of Customs (Appeals), Madras that the metal casting does not come within metal forming process and that the manufacture of cast iron spun pipes through centrifugal castings is excluded from the scope of definition metal working machinery is unsustainable in law especially when text book references prove the contrar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Customs, Madras. 12. He argued that machinery imported under every shipment formed the entire plant and machinery absolutely necessary for the manufacture of cast iron spun pipes. He relied on the sale contract in which the items of goods marked A to O are shown as manufacturing machinery required for setting up of the plant and machinery. He also argued that the exact description of the machinery imported finds a place in the bill of entry to show that what was imported was plant and machinery for the manufacture of cast iron spun pipes and they are metal working machinery attracting the relevant Customs Tariff Item No. 72(17). 13. During the course of his argument the learned Counsel for the appellant invited our attention to the proviso to Notification No. 104 of 1966 dated 6-6-1966 which runs as follows :- Provided that nothing contained in this notification shall affect the standard rate of duty or as the case may be, the preferential rate of duty leviable under the Notification of the Govt. of India, Ministry of Finance (Department of Revenue) Customs Nos. 117,118 and 119, dated the 20th August, 1965, as for the time being in force, on the goods referred to in tho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which passes through several machines made of metal and gets transformed through forming process of metal castings. The resultant product undergoes only a change in shape and not in character or composition. He also clarified before us that several other machines are component parts required for the purpose of cutting, drawing, and making the spun metal conform to the specification prescribed by the Indian Standard Institution and they are also forming part of the machinery in the process of manufacture. He urged us to consider the entire plant and machinery involved in the process of manufacture which were also imported along with the main machinery such as cranes, mono-rails, buckets and other serviceable items connected with the integrated system of machinery in the manufacture as part and parcel of the machinery involved in the manufacture of spun pipes. 16. Lastly, the learned Counsel placed before us a write-up (at page 517 of the paper book volume- 2) showing the working of metal through stages in the manufacture of spun pipes under five several units of manufacture. The learned Counsel also submitted for our consideration the write-up of the process of spun pipes manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pond to the machinery imported as per Item A to O indicated in the Sale Contract (the extract of which is at page 5 of the Paper Book Vol. I). 20. Finally in the course of the argument the learned Counsel maintained that the additional document produced by the Departmental representative in the form of a Circular issued by the Assistant Collector of Customs, Madras is not a statutory notificalion or an authorised order binding on this Tribunal or the public in general in respect of payment of duty covering items of goods - imported. The Circular was not considered either by the Assistant Collector of Customs, Madras or by the Collector of Customs (Appeals), Madras earlier. It is not, therefore, binding on this Tribunal to take into account a Circular order shown as Appraising Department Order C11/58/69 AP dated 28-5-1969 to the Departmental officials, not having any statutory force. 21. In conclusion, the counsel stated that there are two stages in the forming process of manufacture (i) Metal in liquid state (ii) metal in solid state. In the process the molten liquid gets solidified after proper treatment through spinning machines. The product gets necessary heating or cooling ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Departmental Representative fairly stated that the text book authorities produced by the appellant prove the issue that casting comes within metal forming process and that in continuous centrifugal casting, the working of metal in liquid state gets transformed through metal working machine like spinning machine and annealing machine and they alone can be taken as metal working machinery . 24. The Departmental Representative had invited our attention to the diagram of the working of the machinery produced by the appellant and in his opinion Units - II and III would have a correct bearing on the working of metal on the machinery. 25. In conclusion, Shri Durghayya pleaded that the assessment made by the authority on individual items under relevant entries in Customs Tariff Schedule be maintained and the benefit of doubt be extended only to specific machines that work on metals. 26. The point for determination is whether the plant and machinery imported by the appellant in the integrated process of manufacture of cast iron spun pipes would fall within the definition of metal working machinery prescribed in Customs Tariff Item 72(17) and entitled to duty concessions. 27. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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