TMI Blog2017 (1) TMI 1307X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant - Shri R Parthasarathy, Adv. For the Respondent - Shri K Veerabhadra Reddy, JC (AR) Per C J Mathew: We dispose off two appeals pertaining to imports effected by M/s Toyoto Tsusho Pvt Ltd (formerly known as M/s Steel and Logistics Centre (P) Ltd). The first appeal (C/00574/2006) had been decided by this Tribunal, vide order dated 20 th July 2007, with the importer being held to be eligible for the exemption in sl. No. 149 of the Table annexed to notification no. 21/2002-Cus dated 1 st February 2002. Revenue carried the dispute to the Hon'ble Supreme Court which remitted the matter back to the Tribunal with the following directions: During the course of arguments, we were shown two other Chapter headings viz., Chapter 87 and Chapter 94. Chapter 87 deals with vehicles other than Railway or Tramway Rolling stock and includes other parts and accessories of the motor vehicles . Like-wise Chapter 94 have the following nomenclature: Seats (other than those of heading 9402) whether or not convertible into bed'), and parts thereof . Sub-heading 9401.20.00 thereof deals with seats of a kind used for motor vehicles and sub-heading 9401 90 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s set aside for remanding back by the Hon'ble Supreme Court. Appeal of Revenue is against this order of Commissioner of Customs (Appeals), Chennai. 3. Learned Counsel for importer has pointed out that the impugned order, under challenge by Revenue, stands on three legs of which two are the absence of power to adjudicate upon the duty sought to be recovered under proviso to section 28 (1) of Customs Act, 1962 and the contravention of ceiling prescribed for exercise of adjudication powers by Assistant Commissioner with the third being the incorrectness of classification decided upon by that officer. It is contended that the grievance in the appeal of Revenue is restricted solely to the fresh classification by the Commissioner (Appeal) which is described as erroneous and that the appeal is reduced to an academic exercise because, even in the event of the classification being resolved in favour of Revenue, the demand would yet remain unsustainable on the other two unchallenged grounds. We find that the review of impugned order by the competent authority under section 129D of Customs Act, 1962 is indeed limited to the incorrectness of classification of the import item and has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erent view. It held that the can seat covens, at best could make the seat more comfortable, but do not serve as aids to the vehicle as a whole, and therefore, they must fall outside the ambit of Entry 73 of the Second Schedule to the Karnataka Sales Tax Act, 1957 and was not exigible to sales tax at 13 per cent. Undoubtedly this ratio would help the appellant. The learned Judges laid emphasis thus:- Every pant is useful to the car for its effective operation should be the aid of the accessories in order to fall within the said entry. The accessory to a pant which has no convenience of effectiveness to be entire can as such cannot in our opinion fall within Entry 73 . Having given our anxious consideration, with respect, we of the consideration view that the test laid down by the Karnataka High Court that accessories as a part must contribute for convenience or effectiveness in the use of the car as a whole is not a correct test. In our view the connect test would be whether the article on articles in question would be an adjunct or an accompaniment or an addition for the convenient use of another part of the vehicle or adds to the beauty elegance or comfort for the use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act. Therefore, we do not find any ground warranting interference. The appeals are accordingly dismissed but in the circumstances without costs. to demonstrate that accessory can be defined as an item designed to be an adjunct or a component or an addition for convenient use or any part of motor vehicle. According to the importer, these leather pieces are used to manufacture seats which come fitted in the vehicle upon shipments from the factory and are not parts of seats classifiable under chapter 94 of the First Schedule of Customs Tariff Act, 1975. 5. Learned Authorized Representative led us through the notification that, inter alia , exempts 'finished leather of all kinds and submitted that the exclusion is not intended to afford exemption to all kinds of leather but is meant to describe the various sources of leather. It was further contended that the leather, though cut into pieces, was designed to fit as seat covers for automobiles and had been prepared with slots for assembling and stitching to produce seat covers; the imported items assume the character and form of the finished product, i.e., car seat covers, accordance with the General Rules for Interpret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the residual entry in chapter 41 will not be proper. To be eligible for the exemption, the importer will be required to establish that description of the goods match the description in the claimed classification. The importer has not been able to show that the goods as imported would fall under any of the other sub-headings of Chapter 41 which is the test laid down in Toyota Tsusho Pvt Ltd. Pen contra, it is sufficient for Revenue to convince us that the goods do not conform to any of the entries in chapter 41. Indeed, Learned Counsel for the appellant, after having taken us through each of the sub-headings, arrived at 411520, a residual entry, as the default classification. It would therefore appear that the finished leather, cut according to a design, is so imported and sent to ancillary units that supply original equipment to automobile manufacturers for assembling as seat cover. We infer that the leather, having been cut to specific design, has already acquired the description of the goods for which it is intended, viz, that of seat covers, under rule 2a of the General Rules for the Interpretation of Import Tariff in the Schedule to the Customs Tariff Act, 1975. Consequen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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