1981 (9) TMI 288 - CGOVT - Central Excise

Summary

Issues: Classification of goods under Central Excise Tariff - Whether clearance of projector heads, sound heads, and arc lamps constitutes a complete cinematograph projector or parts of a projector.

In the judgment delivered by Shri D.N. Mehta and D.N. Lal, the central issue revolved around the classification of goods under the Central Excise Tariff. The key question was whether the clearance of projector heads, sound heads, and arc lamps manufactured and sold together by the assessee would amount to the clearance of a complete cinematograph projector under Item 37B(a) or parts of a cinematograph projector under Item 37B(b) of the Central Excise Tariff. The petitioners argued that the word 'completely' in the explanation appended to Item 37B was crucial, suggesting that a complete projector need not be fully assembled at the time of clearance for classification under Item 37B(a). However, the Government disagreed, emphasizing that a complete projector includes various parts beyond the three items in question, such as projector head, sound head, arc lamp reflector, pedestal, magazine, box, lens, spools, rewinder, and disc. Consequently, the three items alone could not be deemed a complete cinematograph projector and should be classified as parts of a projector.

Another contention raised by the petitioners was based on Notification 99/72 and Notification No. 100/72, arguing that the combination of projector head, sound head, and arc lamp should not be classified as parts of a cinematograph projector. They claimed that historically, this combination was assessed as a complete projector at a specific duty rate, while the other accessories were duty-exempt. However, the Government countered this argument by stating that the three items in question cannot function as a projector on their own and that the additional accessories termed as mere accessories by the petitioners were essential for the projector's operation. Therefore, the combination of projector head, sound head, and arc lamp should be classified and taxed as parts of a cinematograph projector under Item 37B(b) of the Central Excise Tariff.

Ultimately, the Appellate Collector's decision to classify the projector heads, sound heads, and arc lamps as parts of a cinematograph projector under Item 37B(b) for central excise duty was upheld. The revision application was consequently rejected based on the aforementioned analysis and interpretation of the Central Excise Tariff provisions and notifications.