1991 (7) TMI 182 - AT - Customs

Summary

Issues:
Classification of imported machinery under Tariff Heading 84.56 or 84.59, Admissibility of discount under Section 14 of the Customs Act, 1962.

Classification Issue Analysis:
The appeal concerns the classification of imported machinery described as "Mill Grinding Machinery (Air Attrition Mill Model 0808-3 Jet-o-Mizer)." The department initially assessed it under Tariff Heading (TH) 84.59(1) CTA, 1975, while the respondents claimed its classification under TH 84.56. The Assistant Collector assessed it under TH 84.59(1), considering its design for grinding minerals, plastics, pharmaceuticals, and chemicals. The Collector of Customs (Appeals) allowed the appeal, classifying the machine under TH 84.56 as designed specifically for crushing and grinding minerals and chemicals. The Tribunal, after considering the machinery's capabilities and uses, upheld the appellant-Collector's classification under TH 84.59, as machinery designed for grinding or mixing chemicals is excluded from TH 84.56.

Discount Admissibility Issue Analysis:
The Assistant Collector disallowed a 20% discount totaling U.S. $15675 as a special discount not admissible under Section 14 of the Customs Act, 1962. The department did not challenge this aspect in the appeal. The Tribunal's focus was solely on the classification issue, with no dispute regarding the discount's disallowance.

Remand for Further Determination:
The Tribunal remanded the matter to the original authority to determine whether the product produced by the machine constitutes a commodity under TH 84.59(2) or is merely a processing of chemicals and minerals. The Tribunal noted the absence of evidence from either party regarding the nature of the product brought into existence by the machine. The decision to remand was based on the need for a conclusive determination on whether the machine is meant for the production of a commodity falling under TH 84.59(2).

In conclusion, the Tribunal allowed the appeal by remanding the matter for a specific determination on the classification under TH 84.59(2) based on whether the product created by the machine qualifies as a commodity. The discount admissibility issue was not contested in the appeal.