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TMI Blog2023 (3) TMI 424X X X X Extracts X X X X X X X X Extracts X X X X ..... main of the expression, parts or parts and accessories . As for the remaining good that is not excluded by virtue of the said section note the same can be classified as part or accessory only if it is suitable for use solely or principally with the goods of the said Section. The appellant has cited certain judgments in his submissions. Some of them are Westinghouse Saxby Farmer Ltd vs. Commissioner of Central Excise Kolkata [ 2021 (3) TMI 291 - SUPREME COURT ], G.S. Auto International Ltd. Vs Collector of Central Excise, Chandigarh [ 2003 (1) TMI 700 - SUPREME COURT ], Diesel Component Works Vs. Commissioner of Central Excise [ 2000 (6) TMI 68 - CEGAT, COURT NO. I, NEW DELHI ]. The discussions in these judgments as well as the factual matrix detailed therein, it is clear that the specific exclusion provided to HSN 84.01 to 84.79 do not apply in above judgments. Accordingly, the judgment cited by the appellant varies from the instant appeal both on law and facts. The judgments mentioned above relates to the Chapter 73 and 76 of the erstwhile Central Excise Tariff Act, 1985 and not applicable in the instant case. The appellant has conveniently overlooked the basic nat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 and the classification of the goods shall not alter on account of supply by them to Railways. III. Submission of the appellant: A. The appellant submitted that classification of impugned goods may be done in terms of Note 3 to the Section XVII of Customs Tariffs Act read with corresponding Explanatory notes of the HSN. The principle use of the goods manufactured are as per the design given by the Railways for exclusive use with the railway coaches only. B. The Id. Authority for advance ruling erred in placing reliance on note 2(e) to the section XVII without considering the following:- i. Note 3 to section XVII of the Customs Tariff act; ii. Decision of Hon'ble Supreme Court in case of Westinghouse Saxby Farmer Ltd vs. Commissioner of Central Excise Kolkata-2021(376) ELT 14(SC) also relied upon by the State tax authority in favour of appellant. The Central Tax Authority did not file reply to Id. Authority for Advance ruling. iii. Decision of Hon'ble Supreme court in Case of G.S. Auto International Ltd. Vs Collector of Central Excise, Chandigarh-2003(152) ELT 3(SC). iv. Decision of Hon'ble Tribunal in case of Diesel Component Works ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R-DRIVEN FAN AND ELEMENTS FOR CHANGING THE TEMPERATURE AND HUMIDITY, INCLUDING THOSE MACHINES IN WHICH THE HUMIDITY CANNOT BE SEPARATELY REGULATED 6. The other heading i.e. 8607 reads as under:- 8607 PARTS OF RAILWAY OR TRAMWAY LOCOMOTIVES OR ROLLING-STOCK 7. Before going into the issue under consideration there is an important observation that requires to be made regarding the nature of both the contentious entries of the Tariff. It is easily discernible that the entry 8415 is a very specific entry that is devoted to the classification of the Air Conditioning machines. On the other hand, the entry 8607 is general in nature and seeks to bring within its ambit parts of railway locomotives or rolling stock. One of the fundamental rule of classification of goods is that where there are two competing entries laying claim to the classification of a particular good, a specific entry shall be preferred over the general entry. The Rule 3 of the Classification is reproduced hereunder for reference:- Rule 3: When by application of Rule 2 (b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion:- (a) joints, washers or the like of any material (classified according to their constituent material or in heading 8484) or other articles of vulcanised rubber other than hard rubber (heading 4016); (b) parts of general use, as defined in Note 2 to Section XV, of base metal (Section XV), or similar goods of plastics (Chapter 39); (c) articles of Chapter 82 (tools); (d) articles of heading 8306; (e) machines and apparatus of headings 8401 to 8479, or parts thereof, other than the radiators for the articles of this Section, articles of heading 8481 or 8482 or, provided they constitute integral parts of engines and motors, articles of heading 8483; (f) electrical machinery or equipment (Chapter 85); (g) articles of Chapter 90; (h) articles of Chapter 91; (ij) arms (Chapter 93); (k) *luminaires and lighting fittings and parts thereof of heading 9405; or (l) brushes of a kind used as parts of vehicles (heading 9603). (emphasis supplied) 12. A bare perusal of the said section notes with specific reference to the clause (e) highlights the fact that the expressions parts and parts and accessories do not apply to mac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B) General Arrangement of the Chapter' provide that:- 1................ 2. headings 84.02 to 84.24 cover the other machines and apparatus which are classified mainly by reference to their function and regardless of the field of industry in which they are used . (emphasis supplied) 16. The said explanatory note clearly brings out the fact that the industry in which the said goods are deployed is immaterial for determining the classification and the same should be guided by the function which it is expected to perform. To take this logic further, the good under contention i.e. 'Roof Mounted Air Conditioning Units' being manufactured by the appellant have a specific function to perform i.e. of air conditioning and same should clearly be covered under the heading 8415 and not under 8607. 17. Since, we have examined the Explanatory notes to Chapter 84, it would be prudent to discuss the explanatory notes to Chapter 86 as well to bring a sense of wholeness to the proceedings. Note to heading 8607 as given in the explanatory notes to HSN is reproduced below - This heading covers parts of railway or tramway locomotives or rolling-stock, provided the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art of accessory. 21. An analysis of the said section note demonstrates that the parts or accessory which are not suitable for use solely or principally with the articles of Chapter 86 to 88 are not to be included in the said chapter. On the obverse, parts or accessory which are suitable for use solely or principally with the articles of Chapter 86 to 88 are to be included in the said chapter. But the said section note has to be read in conjunction with the Section Note 2 of the said section. The harmonious construction of the said section notes brings out the fact that section note 2 excludes certain goods from the domain of the expression, parts or parts and accessories . As for the remaining good that is not excluded by virtue of the said section note the same can be classified as part or accessory only if it is suitable for use solely or principally with the goods of the said Section. 22. Further, as far as the said judgement of the Hon'ble Supreme Court is concerned, the Hon'ble Court has itself acknowledged the complexity of the issue and has pointed to the undesirability of generalising the decision of one case to others. The Hon'ble Court, has ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der:- a) the bodywork of a road or railway vehicle ( Cambridge Dictionary ). b) the metal outer part of a road or railway vehicle ( Oxford Dictionary ) c) an automobile body ( Merriam-Webster Dictionary ) 27. An overview of the above definitions highlights the fragility of the argument of the appellant and same does not deserve the consideration of this authority. 28. The appellant has also submitted certain Orders passed by Authority for Advance Ruling and Appellate Authority for Advance Ruling in his favour i.e M/s Daulat Ram Engineering Services Pvt Limited passed by AAR, MP, M/s Prag Polymers passed by AAR, U.P and M/s Concord Control Systems Private Limited passed by AAAR, U.P. In this regard it is to be noted that as per Section 103 of the CGST Act, 2017, the advance ruling pronounced by the Authority or the Appellate Authority under this Chapter shall be binding only,- (a) on the applicant who had sought it in respect of any matter referred to in subsection (2) of section 91for advance ruling; (b) on the concerned officer or the jurisdictional officer in respect of the applicant. 29. The appellant has conveniently overlooked the basic nature ..... X X X X Extracts X X X X X X X X Extracts X X X X
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