1999 (9) TMI 404 - AT - Central Excise

Summary

Issues:
1. Whether molybdenum wire used as a mandrel for making coils of tungsten filament qualifies as an input under Rule 57A.

Analysis:
The appeal before the Appellate Tribunal CEGAT, Mumbai raised the issue of whether molybdenum wire, utilized as a mandrel for coiling tungsten filament, should be considered an input under Rule 57A. The Collector (Appeals) had previously determined that molybdenum wire was an appliance, thereby excluding it from the definition of an input based on a previous decision by the Tribunal in Apar Ltd. v. C.C.E. The appellant argued that the mandrel served as a support for coiling tungsten filament and was a consumable rather than an appliance, citing a decision by the South Regional Bench of the Tribunal that classified molybdenum wire as an input. Additionally, the Board had previously opined that molybdenum was a consumable in Order 267/63/91-CX. 8, dated 30-12-1992, making it eligible for credit.

The Tribunal delved into the definitions of "appliance" and "tool" from the McGraw Hill Dictionary of Scientific and Technical Terms to determine the classification of the mandrel. While the previous decision in Apar Ltd. v. C.C.E. had labeled the mandrel as an appliance, the Tribunal disagreed, suggesting that it was more aptly described as a tool based on the provided definitions. The Tribunal highlighted that the South Regional Bench decision did not address whether the mandrel was a tool or an appliance, focusing solely on its consumable nature. The Tribunal emphasized that the consumable aspect did not preclude the mandrel from being classified as a tool, as all machinery eventually wears out over time, with certain tools like drill bits and saw blades being designed for single-use due to wear and tear.

In its analysis, the Tribunal rejected the argument that the mandrel's consumable nature disqualified it from being considered a tool, emphasizing that Rule 57A did not directly reference the consumable aspect of an input. The Tribunal also refuted the notion that the mandrel did not actively contribute to shaping the tungsten wire, likening it to molds that are considered tools despite not directly shaping the molded item. Ultimately, the Tribunal concluded that the mandrel fell within the excluded category of tools under Rule 57A, affirming the Collector's finding on this matter.

Furthermore, the Tribunal addressed an error in the Collector's order regarding the territorial jurisdiction of Tribunal benches, clarifying that the Tribunal is an all India body without territorial limitations akin to a High Court. The Tribunal dismissed the appeal, upholding the Collector's decision regarding the classification of the molybdenum wire mandrel as a tool under Rule 57A.