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TMI Blog2001 (8) TMI 737X X X X Extracts X X X X X X X X Extracts X X X X ..... earing for the appellants Shri R. Subramaniam, ld. Consultant submitted that the Collector in the order-in-appeal had wrongly rejected the appellant s contentions as to the lack of jurisdiction on the part of the Assistant Collector to initiate proceedings under Section 28(2) of the Customs Act. He submitted that in terms of Section 46 of the Customs Act, upon the goods arriving at the port of entry, the importer was required to file a Bill of Entry for home consumption or warehousing of the goods and upon the Bill of Entry being filed, it becomes incumbent upon the concerned proper officer of the Customs Department to assess the goods in the manner prescribed under Section 17 of the Act. In the case of the appellants the Bill of Entry was assessed by the Proper Officer after perusal of all the documents. Thereafter the customs authorities had duly classified the goods as falling under heading No. 8462.99 and allowed the benefit under Notification No. 40/78. Appellants had thereafter paid the duty as assessed, and the concerned Customs officers had allowed clearance of the goods under Section 47 of the Act. Unless the assessment order was set aside by the appropriate authorities un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1991 (56) E.L.T. 761] in which the Tribunal had taken into consideration the earlier decision in Pure Wall and Associates Ltd. v. Collector of Customs, [1984 (15) E.L.T. 490]. It was held in the latter case that heading 82.05 was identical in description to heading No. 82.05 of CCCN. As regards the expression interchangeable tools under Heading 82.05 meant tools which are inter-changeable between the various types of machines, hand tools, machine tools or power operated hand tools. Interchangeability of the tools, therefore, has to be with reference to a particular machine and not the tool itself. It did not mean that the tool itself should be capable of performing different types of jobs. In the case of the goods imported by the appellants, according to the DR, one set of tools being fitted at the time of importation of Automatic Flow Forming Machine and another set of tools being supplied separately, the criterion of interchangeable tools as given by the Tribunal in the case of New Haven Steel Ball Corporation Ltd., supra, was satisfied. 4. We have considered the submissions. It is common ground between the parties that the goods were initially classified under heading 8462 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Other, including parts 25 8207.20 Dies for drawing or extruding metal 25 8207.30 Tools for pressing, stamping or punching 25 8207.40 Tools for tapping or threading 25 8207.50 Tools for drilling, other than for rock drilling 25 8207.60 Tools for boring or broaching 25 8207.70 Tools for milling 25 8207.80 Tools for turning 25 8207.90 Other interchangeable tools 25 The other competing Tariff Heading is 8462 which reads as under :- Machine-tools (including presses) for working metal by forging, hammering or die-stamping; machine-tools (including presses) for working metal by bending, folding, straightening, flattening, shearing, punching or notching; presses for working metal or metal carbides, not specified above . 6. We find that the meaning of interchangeable tools mentioned in heading 82.07 (82.05 before amendment) was considered by this Tribunal in New Haven Steel Corporation case, supra, earlier. The said expression was considered in the context of CCCN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imported by the appellants along with the extrusion machine (automatic flow forming) for the manufacture of rigid copper wire types complete with tools and their eligibility for concessional duty under Notification No. 40/76-Cus. The Department s case is that the said transfer and additional tools were in the nature of interchangeable tools whereas the importer appellants contended that their import was of a machine complete with tools and spares. The appellants emphasised that the transfer tools and additional tools are original equipment for production of different sizes of detonator tubes for the manufacture of which the machine had been imported. Though they are considered as spare tools, they are essentially for the production of various sizes of detonator tubes. Without these tools the imported machine is of no use. Therefore, these tools were part and parcel of the machine itself. On a consideration of the submissions made by both the sides and on a perusal of the case law, and the write up supplied by the appellants (page 54 of their appeal papers) and the drawings sent there with that it would appear that the additional tools are needed for the manufacture of detonator ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to section 28 which is intended to take care of such cases. 12. Insofar as the question of the assessment is concerned, I find that there is no dispute about classification of the machine proper which falls under 8462.99. In other words, which is by itself in the nature of a machine tool. The appellants have argued that the additional tools and transfer tools accompanying the consignment are essential component of the machine itself as the machine cannot function without them and therefore were correctly classified along with it and consequential benefit of exemption notification was rightly granted initially and there is no cause for revising it. 13. The main dispute thus centers on the applicability or otherwise of the Notification No. 40/78 which is available only in respect of the goods falling under Chapter 84. 14. A perusal of this notification shows that it specifically covers the automatic flow forming machine. Therefore, so far as the machine proper is concerned, it is obviously covered by this notification. But insofar as the accompanying tools are concerned the Explanatory Note (B) under heading 82.07 is important as it covers machine tools of heading 84.57 to 84.6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave to be assessed on merits independently of the heading in which the main machine falls. Appellant has made light of the separate invoicing but it is well known that in international trade the separate invoicing has a significance of its own for customs purposes. 17. Insofar as the case law cited by the appellants namely M/s New Haven Steel Ball Corporation Ltd. (supra) is concerned, in my opinion it does not advance the cause of the appellants. On the other hand, it supports the view taken above; and it is noteworthy that in that order the flashing plates were held as classifiable under heading 82.05 as interchangeable tool on the ground, inter alia, that it was interchangeable w.r.t. Koehlar machines. There is no doubt about it that this order has dealt with one type of interchangeable tools but that does not mean that other types of interchangeable tools do not exist and two types of interchangeable tools mentioned by the A.C. have been noted even by the Tribunal earlier which we shall see as we proceed. Again the machines for which the tools are meant can also be of various types, those which can perform multiple jobs with the help of such tools and those which cannot. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies below have correctly treated these items as interchangeable tools classifiable under heading 82.07, the benefit of Notification No. 40/78 (as amended) was not available to these additional tools and transfer tools. Hence, the appeal is required to be rejected. 20. I therefore, uphold the impugned orders and reject the appeal. Dated : 19-4-1999 Sd/- (S.K. Bhatnagar) Vice President 21. In view of difference of opinion between Member Judicial and the Vice President, the matter is submitted to the President for reference to a third Member on the following point :- They are interchangeable tools classifiable under 82.07 and hence not eligible for benefit of the above notification consequentially ? Sd/- (A.C.C. Unni) Member (J) Dated : 21-4-1999 Sd/- (S.K. Bhatnagar) Vice President 22. [Order per : S.S. Kang, Member (J)]. - Following difference of opinion is referred to the 3rd Member : Whether the tools in question are classifiable under 8462.99 and eligible for benefit of Notification No. 40/78-Cus. OR They are interchangeable tools classifiable under 82.07 and hence not eligible for benefit of the above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 90 held that the dies which are used with the machine but manufacture a particular set of parts cannot be treated as interchangeable tools. The Tribunal held as under : When the tariff heading says interchangeable tools it means that the tools should be interchangeable and not that the machine to which they are fitted should be capable of doing multiple jobs. According to the definition appearing in the ISO Guide interchangeability means the suitability of a product to be used in place of another product to fulfil the relevant requirement. When the Department admits that one particular die set can manufacture one particular watch part only, that it cannot do any other job and that no other tool can take its place and do the same job, we fail to understand how such a die set could be classified as an interchangeable tools . The Tribunal followed this judgement in another case, reported in 1989 (43) E.L.T. 531 (Tribunal) in the case of Delhi Kanodia Tin Drum Factory v. Collector of Customs against which the SLP filed by the Revenue is dismissed by the Hon ble Supreme Court, reported as 1990 (45) E.L.T. A-94. 29. Reliance of Revenue on Tribunal decision in the case of New H ..... X X X X Extracts X X X X X X X X Extracts X X X X
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