TMI Blog1993 (7) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... r 8517.00. In appeals, Collector (Appeals) allowed the appeals accepting the contentions of the party observing that 8541 is more appropriate classification because the panels include modules which are prepared of items like diodes, transistors etc. which are mentioned under 8541. Aggrieved by the said orders the Department has come before us by way of these appeals. 4. We have heard Shri M.S. Arora, learned JDR for the Revenue and Shri J.B. Koshy, learned Advocate for the respondent. 5.The relevant tariff items, viz., 8517, 8541 and 8537 for the sake of convenience of reference are reproduced below :- 85.17 8517.00 Electrical apparatus for line telephony or line telegraphy, including such apparatus for carrier-current line systems. 85.41 8541.00 Diodes, transistors and similar semi-conductor devices; photosensitive, semi-conductor devices, including photo-voltaic cells whether or not assembled in modules or made up into panels; light emitting diodes; mounted piezo-electric crystals. 85.37 8537.00 Boards, panels (including numerical control panels), consoles, desks, cabinets and other bases, equipped with two or mor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s for carrier current line system should be classified under 8517. T.I. 85.37 was neither dealt with by the Collector (Appeals) nor the item was classifiable under the said item as the T.I. 85.37 refers to different items. He referred to the decision of the Supreme Court in the case of M/s. Jain Exports (P) Ltd. Another [1992 (61) E.L.T. 173 (SC) = [1988-17-ECR-631-SC], wherein it was held that once on analysis we reach the conclusion that `coconut oil of every description was covered in paragraph 5 of appendix 9, the quasi-judicial decision ceases to be relevant. He also relied upon the decision of the Tribunal in the case of Filtronics Ltd. v. Collector of Central Excise [1989 (43) E.L.T. (457)] wherein it was held that R.F. inductors, chokes, peaking coils and AM/FM transformers and MW/SW oscillator coils and antenna coils and RF/IF coils are classifiable under 85.04 and not under Heading 85.29 though Electrical transformers, static convertors and inductors are specified in T.I. 8504. Particularly he referred to the relevant portion in para 25 of the said order which reads as under :- There is no doubt that the electromagnetic field by which the desired changes in the fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made up into panels. The main function of the equipment is protection relying that means if there is a fault in the transmission line, the lines are tripped at both ends so that damage does not result to other equipments. It also does the function of telemetry as it will record generation of electrical power at the generating station and record the electrical power by receiving stations and thus ensure transmission and distribution of electrical energy. The protection relying and telemetry are above the speech frequencies. An incidental function is a supervisory control through speech between two stations to check whether lines are working. The equipment is exclusively used by the Electricity Boards and equipments are never utilised for line telephony or line telegraphy. He said that similar question came up for consideration before the Kerala Sales Tax Appellate Tribunal and Kerala High Court subsequently regarding the question whether the PLCC equipment is a sound transmitting equipment including telephone, loud speakers, spare parts thereto coming under Item 13 of the Ist. Schedule to the Kerala General Sales Tax or under Item 26. After going through the facts and evidence of ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, namely the line trap or wave trap. This is inserted directly into the high tension line and carriers of the high tension power. So, the stand that separate conductor is used is not correct. This equipment is used only by the Electricity Board. It is used to control the power system by monitoring the various parameters at the Central Load Despatch Stations. So, it is actually a control equipment so far as the power system is concerned. Speech is only an ancillary aspect. It is used only if the station is not approachable. It is a minor subsidiary function." He said that on seeing the nature and function of the PLCC equipment it will not come under 8517 as claimed by the Department. To come under 8517 it would be an electrical apparatus for line telephony or line telegraphy including such apparatus for carrier current line system. Hence, it should be an electrical apparatus for line telephony and line telegraphy or similar apparatus. The word including such apparatus refers to similar electrical apparatus for line telephony or line telegraphy and the main function should be transmission of speech from one point to another and it is purely an electrical apparatus. The harmonious ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircuits, or for making connections to or in electrical circuits (for example, switches, fuses, lightning arresters, voltage limiters, surge suppressors, plugs, junction boxes), for a voltage exceeding 1,000 volts." He contended that primary function of the article should be taken into consideration while deciding the issue of classification, relying upon the ratio of the decision of the Supreme Court in the case of Atul Glass v. Collector of Central Excise, reported in 1986 (25) E.L.T. 473 and the decisions of the Tribunals in the cases of Collector of C. Excise v. Modern Roofings Ltd., reported in 1990 (45) E.L.T. 174 and Meteor Satellite Ltd. v. Collector of C. Excise [1990 (45) E.L.T. 697]. 8. We have carefully considered the submissions made by both sides and perused the records including technical write up filed by the respondent. To a query from the Bench whether the item in question is electric goods or an electronic equipment, it was urged on behalf of the department that these two terms are synonymous and no distinction has been made in Chapter 85 and the item should be classified as per the description given in the Tariff entry. Since PLCC is a communication equipmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edominant and general use of the PLCC panel is for electric control and only the distribution of electricity used by Electricity Board in high voltage transmission line, we are of the view that it cannot be called as an electrical apparatus for line telephony or line telegraphy or similar apparatus. The word including under Tariff Entry 8517 refers to First Part and such apparatus which means that only similar electrical apparatus that is used in line telephony or line telegraphy. Since the system is not for telephonic or telegraphic use, it cannot be classified under 8517 as it was rightly argued by the respondent s counsel. When once we come to the conclusion that this item cannot be classified under 8517, the next question arises whether the item is classifiable under 8541 or under 8537. When once the item is ruled out under 8517 further classification of the item either under 8537 or 8541 is not of much significance since there is no duty difference as rate of duty is one and the same under both the tariff entries. However, taking into consideration the nature and functional character of the item as predominant and general use is for electric control and distribution of electri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices as a part of the system does not necessarily change the character of the machinery/equipment or the system as a whole. 13. In the Central Excise Tariff, the title of Chapter 85 indicates that it covers electrical machinery and equipment and parts thereof. The word electrical has apparently been used in a generic sense here and a reading of the Chapter notes and the headings of this Chapter together brings it out that the word electrical has been used here to include ; (a) Electronic machinery/equipment and parts thereof; as also (b) Non-electronic electrical machinery and equipment and parts thereof; and (c) A combination of the above two. 14. The Chapter Note 5 relating to the Heading 85.41 and 85.42 refers specifically to (a) Diodes, transistors and similar semi-conductor devices the operation of which depends on variations in resistivity on the application of an electric field; (b) Electronic integrated circuits and microassemblies are : (i) Monolithic integrated circuits in which the circuit elements (diodes, transistors, resistors, capacitors, interconnections, etc.) are created in the mass (essentially) and on the surface of a semi-conductor material ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apparatus for line telephony or line telegraphy, including such apparatus for carrier-current line systems. The use of the words including such apparatus for carrier current line system is significant. It shows that apart from an electrical apparatus for line telephony or line telegraphy, apparatus for carrier current line systems is also included under this Heading and in view of the generic use of the word electrical it would include such apparatus which incorporated some electronic devices as well. I, therefore, hold that the items in question are electrical devices which constitute an integral part of a carrier current line system. 17. The fact that these days carrier current line system could be used for more than one purpose does not affect this basic position. 18. The Headings 85.35, 85.36, 85.37 get excluded in the face of a specific mention of such systems in 85.17. 19. The Heading 85.41 covers the electronic devices mentioned therein as they are whether or not assembled or made up into panels but once they are integrated into a carrier current line system, then they become part thereof and hence are required to be classified under Heading 85.17 and the Chapter N ..... X X X X Extracts X X X X X X X X Extracts X X X X
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