TMI Blog2012 (9) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... assemble all parts of the Television Receivers and make complete television sets, but the said Television Receivers were also operated in the manufacturing unit of the appellant and thoroughly checked and only upon it being confirmed that the Television Receivers were complete in all respects, they were disassembled and along with relevant material and individual serial numbers, sent to the various satellite units. Once the Television Receivers are assembled or are made completely finished goods, the manufacturing process is over and we are not concerned as to what happens subsequently. As it is not in dispute that complete Television was manufactured by the appellant and the time of the parts of the TV set being transported from the factory of the appellant, the parts manufactured by it are already identified as distinct units, thus the Revenue had rightly classified the goods- product as complete Television set even though it was subsequently disassembled - against assessee. - CIVIL APPEAL NO. 4427 OF 2003 - - - Dated:- 7-9-2012 - D.K. JAIN, ANIL R. DAVE, JJ. J U D G M E N T ANIL R. DAVE, J 1. The challenge in this appeal is to an order dated 1st April, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no further action was taken by the Revenue until the year 1993. 5. Thereafter, the Collector of Central Excise, exercising his power under Section 35E(2) of the Central Excise and Salt Act, 1944 vide order dated 18.02.1994 directed the Assistant- Collector to file an appeal before the Collector, Central Excise (Appeals) for setting aside the approval granted to the classification of the goods of the appellant. The Collector (Appeals) by order dated 21/22.07.1994 dismissed the appeal filed by the Department. 6. Against the aforestated order, the Department preferred an appeal before the Tribunal. The Tribunal by its order dated 18.02.2000 remanded the matter to the Collector (Appeals), on finding that the earlier order of the Collector (Appeals) was a non-speaking order and violative of the principles of natural justice. Consequently, the Collector (Appeals) in the remand proceedings decided the issue in favour of the Department vide order dated 26.06.2002. Against this, the appellant filed an appeal before the Tribunal, wherein the order impugned herein was passed. By the impugned order, the Tribunal has accepted the contentions of the Department and held the goods manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to him, as per the sound principle of classification and more particularly as per the provisions of interpretative Rule 1, the goods ought to have been classified under Tariff Entry 8529 because the appellant had manufactured only parts of Television Receivers. He submitted that invocation of Rule 2(a) of the Rules for Interpretation was not justified because looking to the facts of the case, the provisions of Rule 1 of the Rules for Interpretation would apply because of the specific head for parts of Television Receiver , being Tariff Head 8529.00. 11. The learned senior counsel cited the decision of this Court in Commissioner of Customs Vs. M/S Sony India Ltd. [(2008) 13 SCC 145], wherein a case involving analogous headings as those in this case in the Schedule to the Customs Tariff Act, the goods imported by the assessee therein were held to be parts of Television Receivers , and further interpretative Rule 2(a) was held to be inapplicable to such goods. He further contended that as the goods transported by the appellant were substantially in the same position and condition as those transported by the assessee in the above case, the ratio in the said decision would be appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... temporarily assembled by the appellant, being essentially/substantially complete Television Receivers in a disassembled state, would necessarily have to be classified as such, owing to Rule 2(a) of the Rules for Interpretation. It was a simple contention of the Revenue that the appellant had chosen to disassemble the television sets as parts before transporting them in order to avail the lower duty payable on such parts. 17. We have heard the learned counsel and considered the facts of the case. We have also gone through the judgments cited by the learned counsel and upon doing so, we are of the view that the Tribunal did not commit any error while passing the impugned order. 18. The main question that arises for consideration in this case is that of the applicability or otherwise of Rule 2(a) of the Rules for Interpretation to the goods of the Appellant, and the effect of Section Note 2 to Section XVI of the Tariff, reproduced above, on the applicability of such provision. 19. On the question of the applicability of the Rules for Interpretation vis- -vis the Section Notes and Chapter Notes in the Tariff Schedule, the rule laid down by this Court in Commissioner of Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chapters specified therein, shall in all cases be classified in their respective heading. In that light, the fundamental enquiry in this case must be that of whether the goods produced by the appellant may be said to be covered by the above Section Note. 23. In view of the above mentioned Section Note, the question that arises here is whether the goods produced by the appellant can be described as parts under the goods included in any of the headings of Chapter 84 or 85. In this respect, it is the contention of the appellant that the goods produced by them shall inevitably have to be considered as parts , as they are unable to receive a picture, which is said to be a fundamental requirement for a good to be considered as a Television Receiver . At the first sight, one may find force in this contention. As the test in Section Note 2 is simply that of whether the goods in question are parts , it may be convincingly said that as the goods transported by the appellant are incapable of functioning as Television Receivers , they shall have to be considered to be parts thereof. 24. However, on closer scrutiny of the unique facts of this case, it is our view, the goods of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id parts were imported separately in bulk, and thereafter, the process of matching, numbering and assembling was carried out once they were in the possession of the assessee. Therefore, it may be seen that what the assessee had imported in that case were merely various parts which could not yet be identified and distinguished as individual Television Receivers such as the parts transported by the appellant in this case. The said decision is, therefore, distinguishable on facts. 28. For further clarification, it may also be stated that if the appellant had been in the practice of simply manufacturing and transporting parts of Television Receivers in bulk, while leaving the matching and numbering functions to be done at the satellite units, then it could have availed the benefit of Section Note 2, because in such a case, there would not have been any production of identifiable television sets such as in the present case. 29. Once the question of applicability of Section Note 2 to Section XVI of the Tariff is answered in the above manner, i.e. in the negative, there may be seen to be no bar to the application of Rule 2 of the Rules for Interpretation to the goods transported by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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