TMI Blog2018 (4) TMI 1315X X X X Extracts X X X X X X X X Extracts X X X X ..... pellants, the above test when applied to various variants of the impugned vehicle clearly indicate that in these vehicles of the appellant the load carrying capacity is more than passenger capacity. Evidently, these vehicles then cannot be alleged to be vehicles principally designed for the transport of persons which is a sine qua non for meriting classification under Tariff heading 87.03. For a motor vehicle to find a fit in Heading 8703, will necessarily have only a single enclosed interior space, have rear windows along two side panels, have sliding, swing out or lift up doors, with windows, on the side panels or in the rear and more importantly, will not have any permanent panel or barrier between the area for the driver and front passengers and the rear area to enable it being used for transport of both persons and goods. Moreover, as per HSN, to find place in 8703, there should be presence of comfort features and interior finish throughout the vehicle interior - the impugned vehicle namely Mahindra Camper and its variants by no such imagination can be said to be satisfying these requirements. Hence, even by applying the conditionalties attendant to HSN notes in Head ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (impugned orders) relating to these appeals are given as under: S.No. Appeal No. OIO No. Date Differential duty confirmed (Rs.) Penalty under Sec. 25/1 (Rs.) 1. E/2715/2010 O-I-O No: 5/2010 (CE)-Commr. Dt. 28.9.2010 49,12,14,945/- Dropped 2. E/1815/2011 O-I-O No: 13/2011 (CE)- Commr. Dt. 18.04.2011 37,39,84,622/- Dropped 3. E/27430/2013 O-I-O No.04/2013-(CE)Commr, dtd. 16.05.2013 62,12,16,063/- 6,00,00,000/- 4. E/20788/2014 O-I-O No.11/2013-(CE)- Commr, dtd. 06.12.2013 82,68,53,479/- 8,00,00,000/- 5. E/23752/2014 O-I-O No. HYD-EXCUS-001- COM-008-14-15, dt. 26.09.2014 70,00,98,983/- 7,00,00,000/- 6. E/22071/2015 O-I-O No. HYD-EX ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20 65:35 5 Bolero Camper Gold 2WD (1+4) 2510 1800 710 340 370 52:48 Note a) The weight of the passenger is considered as 68 kgs per person, as is the norm used for all measurements by ARAI, VRDE, BIS standards, etc. b) The details indicated above have been compiled from the certificates issued by the ARAI/VRDE in respect of the respective vehicles. These are part of the records with the department. 4. Ld. Advocate also made other submissions, which can be broadly summarised as under : i) For a vehicle to fall under Heading 87.03, it should be principally designed for the transport of persons. However, for it to fall under heading 87.04, it need not be principally designed for transport of goods. Thus, if a vehicle is principally designed for the transport of goods, it will definitely fall under heading 87.04. Even if the vehicle is not principally designed for transport of goods, but if it is for transport of goods and persons, neither of which is its principal design, it would fall under heading 87.04. Therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r transportation of goods under heading 8704. The above mentioned decision of Tribunal in CCE Vs. Telco Ltd. - 2002 (143) ELT 548 (Tri.-Mumbai) was approved by Supreme Court as the appeal filed by the Revenue was dismissed by the Hon ble Supreme Court 2003 (152) ELT A259 (SC). 5. Bolero Camper vehicle and its variants involved in the present case are identical to the vehicle manufactured by the appellants in their Nashik factory, which were considered in the aforesaid decision reported at 2002 (143) ELT 548 and therefore, the issue of classification of the vehicle in question in the present appeals, has been considered and decided by the Tribunal as falling under Heading 87.04 as vehicle for transportation of goods and not as the vehicle principally designed for transportation of passenger under Heading No. 87.03. Hence the impugned orders are liable to be set aside. vi) The Automotive Research Association of India at Pune (ARAI) and the Vehicle Research Development Establishment, Ahmednagar (VRDE), which are institutions established by the Government of India for certifying that the vehicles manufactured and/or plying in India are complying with Central Motor Vehicles Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... argo weight carried being more than passenger weight, the vehicles should be regarded as goods vehicles. This criterion is not sound and logical. In the case of MBC, space i.e. volume, for transport of passengers is more than the volume for cargo box. The facilities provided for passengers are also significantly more. So would be the relative cost of passenger space and cargo space. Hence, relative space available/facilities for passengers and goods should be taken as the criterion and not the relative weight carrying capacity. e) Since MBC is not meant for carriage of goods alone, but instead may be used, without structural alteration, for the transportation of both persons and goods, the same has to be considered only as station wagon , in terms of Note 6 of Chapter 87 of the CETA 1985 1985 and the proper classification of the said vehicle would be under CETH 8703 33 99. f) As per the Customs tariff, station wagon means vehicles with a maximum seating capacity of nine persons (including driver), the interior of which may be used, without structural alteration for the transport of both persons and goods . Per contra, as per Chapter Note 6 to chapter 87 of CE Tariff st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he word Station Wagon was taken out of sub heading 8703, and the amended entries read as under: 87.03 Motor Cars and other motor vehicles principally designed for the transport of not more than six persons, excluding the driver, including racing cars. 87.04 Motor Vehicles for the transport of goods iii) Station wagons were once again included under sub heading 8703 in the Budget 2000 . In addition, a Chapter Note 6 was introduced in Chapter 87 to elucidate the scope of station wagons . 87.03 Motor Cars and other motor vehicles principally designed for the transport of not more than six persons, excluding the driver, including station wagons and racing cars. 87.04 Motor Vehicles for the transport of goods For the purpose of this chapter, station wagons means vehicles which may be used, without structural alteration, for the transportation of both persons and goods iv) We note that the said Chapter Note 6 evidently had its basis in the following HSN Explanatory Notes for Chapter 870 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the major designed Gross Laden Weight of the vehicle is used up. The relevant portions in the order of the Tribunal is reproduced below: Especially when we find that there is no difference in the Headings 8703 and 8704, as regards the term principally designed for transport of not more than six persons used in the CETA, 1985 and HSN, nor is there any material difference between these headings in CETA, 1985 and HSN. We therefore, would apply these rulings even if published subsequently since they explain the scope of the term principally designed for transport of not more than six persons . Ultimate usage of a product, mentioned in the entry is not (h) relevant, when the entry refers to no such end use. In case of 8703 the term Other motor vehicles principally designed for the transport of not more than six persons , may imply reading of an end use stipulation to mean that Design of the vehicle for purpose of transport of passengers and not cargo. we therefore conclude, that an incidental use by crew/family members/farm labour, should not over-ride the essential characteristic of the vehicles herein which is for transport of goods/spare parts tools/goods-farm pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 03, but would classify in the classification as classified for transportation of goods i.e. under Heading 8704. ii) On the contention of the department that the Legislature has partially departed from the concept of station wagon as explained in note 5 of HSN heading 8703, while framing the chapter note 6 in Central Excise Tariff, the Tribunal held that there is no material difference. iii) It has been placed before us that the earlier Tribunal decision pertains to a period prior to introduction of eight digit nomenclature and also prior to introduction of Finance Bill 2000 whereby chapter note 6 and description of heading 8703 of chapter 87 of Central Excise Tariff was amended. However, on careful examination, we find that both the arguments do not carry merit. True, the Tribunal in that decision did consider the period when the eight digit classification had not yet been introduced, however we find that there is no difference whatsoever in the tariff descriptions of the main headings 8703 and 8704 which has been analysed by the earlier Tribunal decision and the description thereof during the period impugned in the present appeal. iv) Revenue has made reference to re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (d) (e) (f) (g) (h) 1. Bolero Camper 2WD (1+5) 2750 1710 1040 408 632 61 : 39 2. Bolero Camper 2WD (1+4) 2750 1710 1040 340 700 67 : 33 3. Bolero Camper 4WD (1+5) 2750 1790 960 408 552 58 : 42 4. Bolero Camper 2WD (1 + 4) 2750 1790 960 340 620 65 : 35 5. Bolero Camper Gold 2WD (1+4) 2510 1800 710 340 370 52 48 Evidently, these vehicles then cannot be alleged to be vehicles principally designed for the transport of persons which is a sine qua non for meriting classificatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ero Passenger Vehicle , whose pricing is comparable to that of Mahindra Camper, hence the impugned vehicle is principally designed for transport of passengers. We are not able to fathom the logic of this argument. It may well be possible that Bolero and Camper have the same engine and same common technical specifications including chassis frame, but the moot point that should not be forgotten is that Bolero is designed as passenger vehicle and would obviously be registered as such. It also cannot be contended that Bolero is not a vehicle principally designed for the transportation of passengers while, on the other hand, the Camper is ostensibly a vehicle designed for transport, principally not for passengers but of goods. 6.9 Ld. Special Consultant for Revenue was at pains to argue that the Chapter Note 6 of Chapter 87 of Central Excise Tariff and the corresponding Note in HSN, the meaning given to station wagon are not the same. To understand his arguments better, we reproduce the two entries: Chapter Note 6 of Chapter 87 of Schedule to Central Excise Tariff 6. For the purposes of this Chapter, station wagons means vehicles which may be used, without st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or space comprising an area for the driver and passengers and another area that may be used for the transport of both persons and goods. Included in this category of motor vehicles are those commonly known as multipurpose vehicles (e.g., van-type vehicles, sports utility vehicles, certain pickup type vehicles). The following features are indicative of the design characteristics generally applicable to the vehicles which fall in this heading : (a) Presence of permanent seats with safety equipment (e.g. safety seat belts or anchor points and fittings for installing safety seat belts) for each person or the presence of permanent anchor points and fittings for installing seats and safety equipment in the rear area behind the area for the driver and front passengers; such seats may be fixed, fold-away, removable from anchor points or collapsible; (b) Presence of rear windows along the two side panels ; (c) Presence of sliding, swing-out or lift-up door or doors, with windows, on the side panels or in the rear; (d) Absence of a permanent panel or barrier between the area for the driver and front passengers and the rear area that may be used for the transport of both persons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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