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TMI Blog1992 (2) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... ne container No. IEAU 2605653 from Canada per S.S. Lanka Ashitha, Voy. 48 W. under Bill of Lading No. TOR 03569 BBY dated 4-9-1992. The said container was declared to contain the following : 1. 65 pcs. equipments declared as Wilshire Mechanical Refrigeration Post Mix Beverage Fountain with Key Lock Facility; 2. 1 set of Spares for the above; 3. 65 pcs. bag-in-box installation Kit-4 FV; 4. 65 pcs. set of four Flojet CO2 Pumps with Quick disconnect and fittings. For the above four items, the benefit was claimed in the following manner : Item No. 1 : was claimed under the CTH Heading 8418.69 with benefit of Notification No. 59/87, 151/92 and 154/92 at the rate of duty of 25% + 30% + NIL; CIF value - Rs. 24,92,843/- and Duty of Rs. 13,84,774/-. Item No. 2 : was claimed under CTH 8418.99 with rate of duty of 65% + 45% + 40% + 15%; CIF value Rs. 16,547/- and duty of Rs. 34,527/-. Item No. 3 : was claimed under CTH 8418.99 with rate of duty of 65% + 45% + 40% + 15%; CIF value of Rs. 3,40,121/- and duty of Rs. 7,09,718/-. Item No. 4 was claimed under CTH 8413 with benefit of Notification No. 59/87 at rate of duty of 25% + 30% + Nil; CIF value of Rs. 2,03,420/- and duty of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lar, he has passed a common order in respect of both the Bills of Entries. 4. In the impugned order, the ld. Collector has upheld the importer s claim for classification of the imported goods under Customs Tariff sub-heading No. 8418.69 of Customs Tariff 1985. However, the ld. Collector has held that the benefit of the Notification No. 59/87 is not available to the imported goods. The ld. Collector has held in the impugned order as follows : Considering the various submissions made by the importers both oral and documentry, and the documentry evidence produced by the Department, one thing becomes clear, the machine under import can make four different soft drinks depending on the flavours of syrup connected to the valve. Further, the soft drink can be carbonated and chilled before sale. When one examines the imported machine by its configuration relative functions of the components and its cost structure and the practice of classifying the goods abroad and in India in earlier cases of import, it is fairly clear that the chilling function is one of the major function of this machine. But going by the rules and interpretation of the HSN and the Tariff, I cannot consider the mach ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stoms House. He has dropped the proceedings against M/s. Voltas Ltd. and M/s. Parle Exports. The importers in this appeal are contending that once Heading 8418.69 is accepted then it follows that Notification No. 59/87 cannot be denied to the imported goods on the ground that they are composite goods performing three functions viz. refrigeration, carbonation and dispensing. They submit that the process of refrigeration is mentioned under Heading 84.18 but the process of carbonation or process of dispensing is not specifically mentioned under Heading 84.18. Thus, these two functions are also not specifically mentioned in any of the headings of Chapter 84 or 85. It is submitted by them that in these circumstances going by the examples given in the explanatory notes to the HSN, the goods may merit classification more appropriately under Heading 84.79 being machines whose individual functions are not specified or included elsewhere in this chapter. They submit that if the classification of the goods under Heading 84.79 is accepted, the exemption under Notification No. 59/87 would be available ipso facto . Thus, they submit, the imported machines would come under the category of machine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nks and carbonation, which disentitle the grant of benefit is totally unacceptable proposition. Such type of findings in other similar cases coming up before the Tribunal has not been accepted. In this connection, he submitted that the application of Section Notes and Chapter Notes for classifying the goods should also be adopted for interpreting the entries in S. No. 13 of the said notification. In this context, he relied on the rulings rendered in the case of Eagle Flask Industries Pvt. Ltd. v. Collector of Central Excise as reported in 1991 (53) E.L.T. 65 (Tribunal) 2. Norsk Data (India) Ltd. v. Collector of Customs - 1992 (57) E.L.T 666 3. Khandelwal Metal Engg. v. Union of India Others - 1983 (12) E.L.T. 292 which is confirmed by SC as reported in 1985 (20) E.L.T. 222. (Para 26) 4. Laxmi Narayan Ram Niwas v. Collr. of Cus. Others - 1987 (32) E.L.T. 12 5. Collector of Customs v. Gemini Overseas Ltd. - 1993 (63) E.L.T. 574 (Tri.) 6. Ganges Soap Works Another v. Union of India Others - 1992 (43) ECR. 707 (All.). 7. Ld. SDR Shri B.K. Singh submitted that the main function of the machine is not chilling although the ld. Collector had held so. Therefore, he sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equipment including freezing equipment (electrical and others) other than household type refrigerator" The description of this heading is identical to the heading in the Tariff Heading. It is not disputed that the equipment is a refrigerating equipment and performs the function of freezing and chilling. The function of refrigerator is to freeze and chill the liquids or articles kept in the refrigerator. S. No. 13 clearly excludes household type refrigerator. The present item is not a household refrigerator and therefore, it falls in the broad heading of the description of the S. No. 13. The only question before us is as to whether the benefit can be denied on the ground that the equipment is a composite one performing two other functions of mixing the soft drinks and carbonation. On going through the product literature, it is very clear that the equipment is a single unit performing the function of refrigeration and automatic service of a required quantity of soft drink through the outlets. The freezing takes place in Bag-in-Box only after the mixing of different soft drinks and carbonation. The process of mixing and carbonation is a function which occurs inside the refrigerat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the notification because the notification also talks of articles of plastic falling under the specified headings. We, therefore, hold that the goods are eligible for exemption in terms of S. No. 38 of Notification No. 132/86, dated 1-3-1986 upto 1-3-1988 and S. No. 39 of Notification No. 53/88, dated 1-3-1988 from 1-3-1988. Incidentally, we observe that the Board s circular is also on the same lines. We allow the appeal . On the question of reference to notes in Section 15 of the First Schedule to Tariff Act, to a exemption notification issued under Section 25 of the Customs Act, the Hon ble Delhi High Court in the case of Khandelwal Metal Engg. v. Union of India Others (supra) [reported in 1983 (12) E.L.T. 292] has held in paras 16 17 of the judgment as follows :- ****** Elaborating and confirming the above principle, the Hon ble Supreme Court in the same case [reported in 1985 (20) E.L.T. 222 (SC)] on appeal held in paras 26 to 30 as follows :- ****** The above principle has been rightly applied in the case of Norsk Data (India) Ltd. (Supra) reported in 1992 (57) E.L.T. 666 has held in para 6 as follows :- ****** The Hon ble Calcutta High Court also held l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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