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TMI Blog1988 (3) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Industries, Gujarat State has issued a certificate dated 16th October, 1981 certifying that these parts are utilised by the petitioners for their end product, namely, mechanical Seals used for Centrifugal pumps and compressors. 2. Prior to August 1976 the parts imported by the petitioners were classified under Tariff Item 72(3) of the Customs Tariff under the Indian Customs Tariff Act, 1934. As from 2nd August, 1976 the new Customs Tariff Act of 1975 came into operation. Under this Act the Import Tairff schedule was revised to bring it in line with the Brussels Tariff Nomenclature. 3. After coming into force of this Act the above components imported by the petitioners have been classified under various tariff entries as set out in paragraph 11 of the petition. The petitioners, in this petition pray for a declaration that those parts which are imported by them should be declared as falling under Tariff Item 84.10(1) or 84.11 (1) as the case may be; that the orders and Bills of Entry as set out in the prayer should be set aside and a refund of excess duty as summarised at Exhibit 'SP' amounting to Rs. 36,77,455.56 be granted. The refund asked for covers the period list ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... seals which are specifically designed by the petitioners for centrifugal pumps or compressors and can be used only with centrifugal pumps or compressors fall by virtue of Note 2(b) under the Heading 84.10(1) or 84.11 (1). They are parts used in such pumps or compressors. 7. In the Statement of Objects and Reasons of the Customs Tariff Act, 1975, it is stated that the Customs Tariff under the Customs Tariff Act, 1975 is designed to bring it in line with Brussels Tariff Nomenclature, making such contractions or expansions thereto as were necessary to suit the needs of India. Section XVI of the Brussels Tariff Nomenclature deals with Machinery and Mechanical Appliances, Electrical Equipment; Parts thereof. In Section Note (2) which is similar to our Section Note 2, it is provided, "In general, parts which are recognisable as specialised to or mainly for use with particular machines or apparatus ...... or with a group of machines or apparatus falling in the same-Heading, are classified under the same Heading as those machines or apparatus subject, of course, to the exclusions mentioned in Part (I) above." Exclusions are not relevant for the present purpose. It further states, "Other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or of Industries or the Commissioner of Industries of the State concerned, in the case of firms which are classified as falling under the Small Scale Sector." (2) the importer shall, by the execution of a bond in such form and for such sum as may be prescribed by the Assistant Collector of Customs, bind himself, to pay, on demand, in respect of such parts as are not proved to the satisfaction of the Assistant Collector of Customs to have been used for the aforesaid purpose an amount equal to the difference between the duty leviable on such parts but for the exemption contained herein and that already paid at the time of importation." There was a similarly worded exemption which was in operation prior to this exemption Notification. This was Notification No. 350 dated 2-8-1976 as amended from time to time. The petitioners import parts which are used in the manufacture of mechanical seals specially designed for centrifugal pumps and compressors. Such mechanical seals fall under Tariff Entries 84.10(1) and 84.11 (1). The parts therefore, which are imported by the petitioners and used for the manufacture of such mechanical seals are covered under this exemption notification. They w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the benefit of the exemption notification because the respondents were of the view that mechanical seals do not fall under tariff item 84.10(1) or 84.11(1). The department was of the view that these seals fall under tariff item 84.65. Since this heading is not specified in the exemption notification the petitioners were denied the benefit of the exemption notification. 12. For the first time in their affidavits the respondents have taken up a contention that the parts imported by the petitioners as well as the mechanical seals manufactured by them are general purpose items. The respondents have not produced any material in support of their bare averments to this effect. In fact the respondents were unable to specify any other article in which such mechanical seals or parts for their manufacture could be utilised. The petitioners manufacture mechanical seals of a special variety which can be used only for the manufacture of centrifugal pumps or compressors. They are made to specifications. The contention of the respondents that these are general purpose mechanical seals must therefore be rejected in the absence of any material in support of this contention. 13. The petitioner f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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