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TMI Blog2018 (12) TMI 478X X X X Extracts X X X X X X X X Extracts X X X X ..... ts specifically designed for use in rice mills are supplied alongwith the other rice mill machinery to the rice millers. These facts are not in dispute, therefore, the combination of machines and the conveyors and elevators supplied by the appellants alongwith other rice milling machinery to the rice millers is a combination of machine which ultimately perform the function of rice milling - Thus, as per Section notes the entire machinery is classifiable under heading 8437 which is for machinery used in milling industry and it is not disputed that these elevators and conveyors being manufactured by the appellants were not used for milling industry. The appellants have produced various technical opinions as well as the data from Customs and Central Excise Department wherein the importer as well as exporter of elevators and conveyors used specifically designed for rice milling have been classified under heading No. 8437 of the CETA. Revenue heavily relied on the decision of Eminence Equipments Pvt. Ltd. [2015 (7) TMI 545 - CESTAT MUMBAI] to say that conveyors and elevators used for rice mills is to be classified under chapter heading No. 8428 - We have gone through the facts in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of equal amount on them under Section 11 AC and penalty of Rs. One Crore on Shri Nirdosh Bali, Managing director of the appellant company. Against those orders, the appellants are before us. 3. Ld. Counsel for the appellants submits that it is the dispute of classification and it has not been disputed that the appellants were manufacturing rice mill machinery along with elevators and conveyors which were specifically designed for the machinery manufactured by them. The show cause notice as well as the impugned order have nowhere disputed the fact that the sale of the said items have been made to rice millers only and not to any other industry. The department has solely confirmed the demand on the basis of the explanatory note to HSN wherein it has been mentioned that Heading 8437 would not include conveyors and elevators of Heading 8428. It is to be mentioned that section note 3, 4 5 to Section 16 of the Central Excise Tariff Act clearly clarify that where two or more machineries are fitted together to form a function complementary and alternative to each other and consist of individual components then the whole machine is to be classified in the heading appropriate to that f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law and they are only for guidance and the classification is to be done as per the Central Excise Tariff Act. Even otherwise it is to be mentioned that even as per the description under Chapter Heading 8437 machinery use in milling industry it has been categorically held that grinding of crushing machinery would include feeder machines designed to ensure local and even flow of grain to the crushing rollers. The main function of the elevators and conveyors is to take the grain from one machine and feed the same in the other machines along with its machineries. Thus, it is clear that elevators and conveyors are in the nature of grain feeders only as they perform the function of feeding grains in various machines used in the rice mills. Thus even as per the HSN also the feeder machines which are in the nature of elevators and conveyors remain under Heading 8437. He relied on the various decisions of this Tribunal, namely, Commissioner of C.Ex. and Cus. Bangalore-l Versus Buhler (India) Ltd. reported as 2017 (356) E.L.T. 264 (Tri. - Bang.), Moped Assembly Versus Commissioner of Central Excise, Madras reported as 2001 (129) E.L.T. 195 (Tri - Chennai), Thermax Ltd. Versus Collector of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the Revenue strongly objected the arguments advanced by the Ld. Counsel for the appellants and submits that the Chapter Heading No. 8428 cover conveyors and elevators, therefore, they are specifically covered under the said entry and having support of the HSN explanatory notes, the Tariff Heading No. 8437 does not cover conveyors and elevators and same is classifiable under Chapter heading No. 8428. To support of her contention, she relied on the decision of the Tribunal in the case of Eminence Equipments Pvt. Ltd. Vs. Commissioner of Central Excise, Pune-I 2015 (330) ELT 344 (Tri.-Mumbai) wherein the issue before the Tribunal was classification of conveyors and elevators and this Tribunal has held that the conveyors and elevators having merit classification under Tariff Heading No. 8428. Therefore, the impugned orders are to be upheld. 5. Heard the parties and considered the submissions. 6. For better appreciation to decide the classification, the tariff heading No. 8428 and 8437 of Central Excise Tariff Act are extracted herein below:- 8428 Other Lifting, Handling, Loading or Unloading Machinery (For example, Lifts, Escalators, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Machines for cleaning, sorting or grading seed, grain or dried leguminous vegetables u Nil 8437 80 Other machinery: - - 8437 80 10 Flour mill machinery u Nil 8437 80 20 Rice mill machinery u Nil 8437 80 90 Other u Nil 8437 90 Parts - - 8437 90 10 Of four mill machinery kg. Nil 8437 90 20 Of rice mill machinery kg. Nil 8437 90 90 Other kg. Nil The case of the Revenue is that as per HSN Explanatory notes to Chapter Heading No. 8437, the machine used in milling industry. However, the heading does not cover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ultimately perform the function of rice milling. Thus, as per Section notes the entire machinery is classifiable under heading 8437 which is for machinery used in milling industry and it is not disputed that these elevators and conveyors being manufactured by the appellants were not used for milling industry. The Central Excise Tariff is clear with respect to this aspect that the said machines if supplied as a combination of machines would be covered under the main heading 8437, therefore, the reliance on the explanatory note to HSN is not warranted as the HSN explanatory note is not a law but are they are only guiding factor for classification when the section note to the Central Excise Tariff is clear on the aspect wherein it has been clarified that the said items are to be classified under the main machine. Therefore, the department cannot place reliance upon the explanatory notes to change the classification of the said items. 7. We further take a note of the fact that in the case of Commissioner of Central Excise, Kanpur vs. Rationale Iron Steel Co. (supra), this Tribunal has categorically observed that explanatory notes have no force of law and they are only for guidanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 8428. We have gone through the facts in the case of Eminence Equipments Pvt. Ltd. (supra) was not manufacturing the elevators and conveyors only for rice millers but were supplying the same to other industries like breweries etc., therefore, the items manufactured by Eminence Equipments Pvt. Ltd (supra) were of general nature and not for specific use to the machines of milling industry. Further, the conveyors and elevators manufactured by M/s Eminence Equipments Pvt. Ltd. (supra) did not come under the category of composite machines as they were supplying only elevators and conveyors and not combination of machines. Therefore, the facts of the present appellants are distinguishable from the facts of the case of M/s Eminence Equipments Pvt. Ltd (supra). Moreover, in the case of Eminence Equipments Pvt Ltd. (supra) this Tribunal has not considered the chapter note 3, 4 and 5 of Section 16 of Central Excise Tariff Act, 1985. Therefore, on that account also the decision of the said case is not applicable in the present case. 10. Moreover, the appellants have produced various technical opinions as well as the data from Customs and Central Excise Department wherein the importer as w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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