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TMI Blog1991 (5) TMI 260X X X X Extracts X X X X X X X X Extracts X X X X ..... rted consignments of Hose Assemblies made of vulcanised rubber other than hardened rubber with end fittings. The goods were classified under heading 4009.50 of the First Schedule to the Customs Tariff Act, 1975 (hereinafter referred to as the Schedule ). After clearance of the goods on payment of duty as assessed the appellants filed claims for refund contending that the goods correctly fell under Heading 98.06 read with heading 8439.49 and Notification 69/87-Cus. The Assistant Collector held that heading 4009.10 was specific for the goods and so the refund claimed on the ground of alleged wrong classification of the goods was not tenable. In appeal, the Asstt. Collector s orders were upheld. Hence these appeals. 3. Before us there is no contention that the goods fell under Heading 98.06. The claim is with reference to heading 8431.49 read with heading 8429.59 as parts suitable for use solely or principally with loaders falling under Heading 84.29. There is also no dispute about the composition of the goods. Admittedly, they are made of vulcanised rubber other than hard rubber. 4. We have heard Shri A.S. Sunder Rajan, Consultant, for the appellant and Shri M. Jayaraman, SDR, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... classified in Heading No. 85.17; (c) All other parts are to be classified in Heading No. 84.85 or 85.48. Hoses with fittings were not specified in Chapter 84 and, therefore. Section Note 2(a) was not applicable. By operation of Section Note 2(b), the present goods, which are designed solely or principally for use with loaders falling in Heading 84.29, are to be classified with loaders and, more specifically, under Heading 84.31, sub-heading 8431.49. In this context, attention was also drawn to the phraseology employed in Heading 84.31, namely, Parts suitable for use solely or principally with the machinery which was similar to that employed in Section Note 2(b). The appellant had produced catalogue before the lower authorities to show that the sole or principal use of the Hose Assemblies in question was with loaders and this was not in dispute. The Collector has fallen in error in relying on Section Note 2(a) to Section XVI. The Collector has concluded that in terms of Section Note 1(a) (reproduced earlier) the present Hose Assemblies made of vulcanised rubber other than hard rubber was excluded from Section XVI. He has further concluded that the provisions of Section Note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inding nature and, therefore, the application of the said golden rule of construction has to be tempered with the effect of the chapter notes, section notes and, where necessary, the rules for interpretation of the Schedule). Shri Jayaraman further submitted that Section Note 2 to Section XVI could be invoked only after ruling out Section Note 1 [Note 1(a) in this case]. 7. In rejoinder, Shri Sunder Rajan stated that the impugned order did not rest the decision on Chapter Note 2(d) to Chapter 40. It was based on Section Note 1(a) to Sec. XVI and the Departmental Representative should not be allowed to use his ingenuity in buttressing the Department s case. He placed reliance in this connection on the Bombay High Court s judgment in Cadbury Fry (India) Private Limited v. Union of India 1990 (46) E.L.T. 7 (para 18). Shri Sunder Rajan also cited other authorities before us which we will refer to at the appropriate place. 8. We have considered the submissions of both sides and perused the record. There are certain basic facts or features which are not in dispute - one is that the hose assemblies in question are made of vulcanised rubber other than hard rubber. Another is that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dule are part of the law. Submissions based on legal provisions are not the same thing as submissions made on new factual grounds. We do not accept Shri Sunder Rajan s objection to the reliance sought to be placed on certain chapter notes and section notes which the Collector did not take into account. 10. Chapter Note 2(d) of Chapter 40 has to be seen in the light of Section Note 1(a) to Section XVI. Going by the latter note, Section XVI does not cover articles of a kind used in machinery or for technical uses, of vulcanised rubber other than hard rubber. However, in our view, this part of the section note excludes only such articles as fall under Heading 40.16. It is not the Revenue s case that the present goods fall under Heading 40.16. They have been classified under Heading 40.09, sub-heading 4009.50. However, this fact alone would not mean that the present goods fall under Section XVI. In this connection, it is also to be noted that the reliance placed by Shri Sunder Rajan on Section Note 2(b) in support of the appellant s claim for classification of the goods in Chapter 84 is, in our opinion, misplaced for the reason that the provisions of Section Note 2(b) are, as the op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of headings, sub-headings, section notes and chapter notes. We agree and we have already discussed this aspect. 12.2 (b) Hindustan Aeronautics Limited, Bangalore v. Collector of Customs, Madras - 1986 (25) E.L.T. 200 (Trib.) para 5 - In that case, gear boxes were specifically mentioned in Heading 84.63. The contention for the appellant was that the gear boxes in question were not general purpose ones but designed for use solely or principally with a particular kind of machine and so ought to be classified along with the machine under Heading 85.45/48, by application of Section Note 2(b) to Section XVI. The Tribunal negatived this contention and upheld the classification of the goods under the specific heading for gear boxes i.e., 84.63. This decision, in our view, has no relevance to the present case for the reason Hose Assemblies are not specified in Chapter 84 unlike gear boxes. 12.3 (c) Saurashtra Chemicals, Porbandar v. Collector of Customs, Bombay -1986 (23) E.L.T. 283 (Trib.) - paras 8 and 9. In that case, the goods were carbon rings and ring carbon seals for use as spare parts in turbo sets and compressors. The Department classified them under Heading 68.01/16(1) as ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section notes. 12.5 (e) Katrala Products (P) Ltd. v. Collector of Customs -1989 (44) E.L.T. 160. In this case, the question was whether polycarbonate tubes (bottle guards) were classifiable under Heading 84.19 of the Schedule or Heading No. 39.01/06. The tubes were claimed to be made to precise specifications for the specific purpose of being used as component part of soda making machine. Therefore, they were claimed to fall under Heading No. 84.19 under which the machine fell. The Department s contention was that there was nothing to distinguish these tubes as parts of soda making machine and that they were merely tubes of plastic falling under Chapter 39. The Tribunal considered the evidence on record and concluded that the tubes were designed principally for use with soda making machines. This conclusion rested on the special characteristics of the tubes as also Note 1(ij) to Chapter 39 which excluded from the Chapter articles falling within Section XVI (machines and mechanical or electrical appliances) though, in the normal course, the tubes may have been classifiable under Chapter 39. Reliance was also placed on Section Note 2(b) to Section XVI. This decision, in our opi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fall in line with the specific things desig nated by the preceding words. But unless there is a genus which can be comprehended from the preceding words, there can be no question of invoking this rule. Nor can this rule have any application where the general words precede specific words. The Learned Consultant has called to aid this judgment in support of his contention that the fittings to the subject hoses were not of the genus of joints, elbows or flanges mentioned as examples of fittings in Heading 40.09 (reproduced earlier). The Supreme Court was construing Section 40(2) of the Central Excises Salt Act prior to its amendment by Act 22 of 1973 and more particularly the expression No suit, prosecution or other legal proceeding . The Court concluded that legal proceeding should be read ejusdem generis with suit and prosecution as they constitute a genus and, therefore, the legal proceedings referred to would be those instituted in a Court of Law and not proceedings before statutory authorities. Now, the Supreme Court has held that the rule cannot have any application where the general words precede specific words. In the instant case, the general word fittings prec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of hardened rubber and of other goods. The description in Heading 40.09 read with sub-heading 4009.92 was more specific. The Tribunal took the view that though the hose pipes in question were cut to specific sizes and subjected to further processes and fitted with fittings, their essential character remained as hoses with fittings, designed for the purpose of conveying air, gas or liquid. It might be true that the article was designed specifically for certain machines but this would not alter its character. The Tribunal also took note of the manufacturers catalogue which described the goods as hoses. The Tribunal also noted that Chapter Note 2(d) excluded parts made of hardened rubber only and concluded that if the intention had been to exclude parts made of vulcanised rubber, it would have been specifically mentioned in the said note. By necessary implication, parts made of vulcanised rubber of mechanical and electrical appliances, would be covered by Chapter 40. Note was also taken of the Explanatory Notes to the HSN Heading 40.09 which clarified that the heading covered tubes of vulcanised rubber whether or not cut to length. Heading No. 40.09, being more specific, had to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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