TMI Blog2019 (8) TMI 141X X X X Extracts X X X X X X X X Extracts X X X X ..... form/disassembled condition for which mere cable connection is required for said kit to constitute one single machine called as laser levelling machines. Those parts need simple cabling at the site, to be levelled, to function as a complete machine of laser land leveller. The said activity of cabling is already held to not to be called as manufacture. Those observations take the impugned imported products out of the ambit of serial No. 399(B) of Notification No. 12/2012. The allegation that these parts are not always in the term of kit are also not opined to be sustainable as is apparent from the invoices. The extra parts imported are for previously so imported machines, in addition to complete kit. There seems no reason to repeat the contention of the appellant that along with the kit the extra parts were imported for the other machines which were already in use. The parts and components as have been imported by the appellants since do not require any activity which can be called as manufacture, but when cabled at the site they can be used as a laser land levelling, an agricultural machine, the product qualifies to fall under serial No. 399(A) of the Notification No. 12/2012 da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der CTH 8432 as Agriculture Machinery attracting BCD only @ 2.5% by virtue of the said Notification. It was also noticed by the Department that the importer sometimes imported one of the above said items and sometimes two or three of them and not the complete set of Laser Land Leveller. Accordingly, an opinion was formed that the appellant were not entitled for the exemption of the Notification. Resultantly, a show cause notice No. 7406 dated 07.06.2016 was served upon the appellant proposing the recovery of customs duty amounting to ₹ 2,37,74,326/-. Being the concession/exemption wrongly availed and thus being a short paid duty for a period w.e.f. 01.11.2011 to 31.03.2016. The amount of ₹ 50,27,509/- as was already deposited was proposed to be recovered. Interest at the appropriate rate and the proportionate penalties were also proposed to be imposed upon the importer as well as the Director of the importing Company namely Shri Manoj Kumar Sharma/ the appellant in Customs Appeal No. 53219 of 2018. The said proposal was absolutely confirmed vide the Order under challenge. Being aggrieved, the appellant is before this Tribunal. 3. We have heard Shri Vir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to be rejected. 6. After hearing both the parties and perusing the entire record we are of the opinion as follows: 6.1 The question to adjudicate in this Appeal is as to: 6.1.1 Whether the appellant Company/ importer is entitled for the benefit of the Notification No. 12/2012 for the products imported by him being agricultural machinery as named in Serial No. 399(A) of the said Notification. 6.1.2. For the purpose, Notification is to be looked into. It reads as follows: Sl. No. Chapter or heading or subheading of tariff item Description of goods Standard Rate Addl. Duty Rate Condition No. 1 2 3 4 5 6 399. 84 or any other Chapter, 85364900 (A) The following goods, namely:- (i)Paddy transplanter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... toms having jurisdiction over the premises where the imported goods shall be put to use for manufacture of goods or for rendering output service, the estimated quantity and value of the goods to be imported and the part of import in respect of a particular consignment for a period not exceeding one year. 7. Thus, for imported goods to avail benefit of the notification Sr. No. 399(B) should be such as have to undergo the process of manufacture for being called as agricultural machine at Sr. No. 399(A) of the Notification. Hence, it is foremost important to check as to whether cabling of various parts of agricultural machine so as to let them function as a complete machine amounts to manufacture or not. Section 2F of Central Excise Act, 1944 defines manufacture to include any process: (i) incidental or ancillary to the completion of a manufactured product. (ii) --- (iii) --- 8. The Hon ble Supreme Court in the case of Union of India Vs. Keshedeo Shivprasad 2002 (145) ELT A 163 (S.C.) has held that incidental or ancillary process must be an integral and inextricable part of production or manufacture r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e all, it has been classified by the Hon ble Apex Court in the case Collector Vs. Steel Strips Ltd. 1995 (77) ELT 248 (S.C.) that onus to establish manufacture lies on the Department. 10. Applying this entire case law to the facts of the present case, apparently and admittedly, the appellant is importing different parts in a kit form/disassembled condition for which mere cable connection is required for said kit to constitute one single machine called as laser levelling machines. Those parts need simple cabling at the site, to be levelled, to function as a complete machine of laser land leveller. The said activity of cabling is already held to not to be called as manufacture. Those observations take the impugned imported products out of the ambit of serial No. 399(B) of Notification No. 12/2012. The allegation that these parts are not always in the term of kit are also not opined to be sustainable as is apparent from the invoices. The extra parts imported are for previously so imported machines, in addition to complete kit. There seems no reason to repeat the contention of the appellant that along with the kit the extra parts were imported for the other machines w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al duty @ 2.5% is applicable. Hon ble Supreme Court also has supported these observations in the case of Commissioner of Central Excise Vs. BHEL 2018 (010) GSTL 3 (S.C.) wherein it was held that although the product imported being the components of boilers are cleared as part but since those are capable to put into operation as a complete boiler without any activity of manufacture, the Rules of Interpretation and HSN notes about incomplete and unassembled machines have been rightly relied upon for classifying the goods under the respective heading for the complete boilers. 14. In this case, the machine is laser land leveller. Keeping in view all the said observations, opinions and findings we hold that Department has wrongly held the articles imported to be the articles falling under either Chapter 9015 instead of Chapter 8432 and under Serial No. 399(B) of Notification No. 12/2012 by forming a rigid opinion about the products imported to merely be the parts and components of the impugned agricultural machines. The findings are therefore hereby set aside, also for the reason that the Department has failed to discharge its onus to prove the activity of the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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