TMI Blog2023 (1) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... , could have only specified the any sub division at a level beyond the six digit nomenclature set out in the code. The amendments made in the First Schedule to Central Excise Tariff Act, 1985 by the amending Act of 2004 were to expand the classification code from 6 digit to 8 digit and align the Central excise tariff with the Customs Tariff which was aligned to HSN. By adopting the Eight Digit classification code in Central Excise to align the Central Excise Tariff with the Custom Tariff, the classification of the goods at the six digit level could not have been amended. From the perusal of the purchase orders it is quite evident that the findings recorded in the impugned order that the appellant was supplying only silo per-se cannot be sustained. It is silo system which is capable of performing the assigned function is being manufactured and cleared by the appellant along with the associated accessories. It is settled position in law as per the Rule 2 (a) of the General Rules of Interpretation and clearly specified as per Section Note 3, 4 5 to Section XVI of the First Schedule to the Central excise Tariff Act, 1985 that essential character determines or the prime function ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PUN-EXCUS- 001-APP- 114/2019-20 dated 30.09.2019 25.01.2018 Jan 16- June 17 1,90,09,557/- 12,95,54,099/- 1.2 By the impugned order following has been held: A. PUN-EXCUS-004-COM-10-11/16-17 dated 24.11.2016 ORDER i) I reject the classification of 'Silo' under Chapter Subheading 84379090 of the Central Excise Tariff Act, 1985 adopted by M/s. B.G. Shirke Construction Technology Pvt. Ltd. ii) Silos are to be classified under chapter sub-heading 94060099 of the Central Excise Tariff Act, 1985 as is proposed in the subject notices. iii) Invoice value of clearance of Rs. 86,64,10,215/- during the period October, 2010 to March, 2015 as above and Rs. 6,59,87,402/- for the period from April, 2015 to December, 2015 respectively is to be considered as assessable value under Section 4 of the Central Excise Act, 1944 involving Central Excise duty payable amounting to Rs. 10,22,96,115/- and Rs. 82,48,427/- respectively. iv) Extended period has been correctly invoked in the show cause notices for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Only) under rule 26(1) of the Central Excise Rules, 2002. v) I do not impose personal penalty on Shri. Vijay B. Shirke, Chairman and Managing Director (noticee no. 3) of M/s. B.G. Shirke Construction Technology Pvt. Ltd. as discussed in para 98.2 above. This order is passed without prejudice to any other action that may be initiated against the noticee under the Central Excise Act or Rules made there under or any other law for the time being in force in India. B. PUN-EXCUS-001-APP-114/2019-20 dated 30.09.2019 Commissioner (Appeal) has upheld the order in original No PUN-EXCUS-001-ADC-RKD-0-19/18-19 dated 30.11.2018 holding as follows: ORDER 21.1 I reject the classification of the subject excisable goods i.e. 'Silo' under Chapter Sub-heading 84379090 of the erstwhile Central Excise Tariff Act, 1985 adopted by M/s. B.G. Shirke Construction Technology Pvt. Ltd., 72-76, Mundhwa, Pune 411036 and hold that Silos are to classified under chapter sub-heading 94060099 of the erstwhile Central Excise Tariff Act, 1985 as is proposed in the subject Statement of demand. 21.2 I confirm the invoice value of clearance of Rs. 15,20,76,461/- (Rupees Fif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... them under Chapter Sub-heading 84379090 of the Central Excise Tariff Act, 1994 and are clearing at Nil rate of central excise duty, though the Silos manufactured and cleared by them appear classifiable under Chapter Sub-heading 94060099 of the Central Excise Tariff Act, 1985 and attracting normal rate of Central Excise Duty, investigation/ enquiries were initiated. 2.3 On the basis of investigation undertaken revenue was observed that the silos manufactured and cleared by M/s, BGSCTL, Pune have the essential character of prefabricated buildings and has an independent function of storage or housing of grains / other produce / finished product, etc. Hence, in accordance to Rule 2(a) and Rule 3 of the General Rules of Interpretation of the First Schedule to the Central Tariff Act, 1985 and section note 4 of section XX of chapter 94, the silos manufactured and cleared by M/s. BGSCTL, Pune appear to be rightly classifiable under Chapter Sub-heading 94060099 of the first schedule of Central Excise Tariff Act, 1985 and is subjected to normal rate of Central Excise Duty. 2.4 Accordingly show cause notice dated 03.11.2015 was issued by the Additional Director General DGCEI, Bangalore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der is not correct. In fact, the 8 digit tariff was introduced in 2005. What prompted the department to investigate in 2014 and issue show cause notice in 2015 came to the knowledge of the appellant after filing RTI application. The appellant sought information under the provisions of the Right to Information Act, 2005 vide letter dated. 08.01.2016. In the said application, the appellant sought the following information: From 2011 till date, inform if Central Board of Excise and Customs (CBEC) had sought views/comments on classification of grain storage silos; (ii) Inform if the reply was sent to CBEC by the office of the Chief Commissioner of Customs and Central Excise, Pune. In reply thereto, vide letter dated 19.01.2016 the above information was provided to the appellants along with copies of the communication sought thereof. On perusal of letter F. No. 84/04/2012-CX.I dated 15.10.2012, it is clear that the CBEC had sought the view of the Pune Commissionerate on the issue of classification. The same was sought on a reference made by M/s Fowler Westrup (India) Private Limited vide letter dated 17.09.2012. In reply to the CBEC, the Ld. Chief Commissioner of Central Excise, Pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de. It would also facilitate collection and compilation of specific data on commodities of special significance to India and sharing such data among various agencies. The expansion of the tariff classification would provide flexibility in the international trade negotiations along with facilitating collection of specific statistics. A common eight-digit commodity classification code would also facilitate effective computerization of tax administration and electronic data processing. This was the rationale for introduction of eight digit classification. Hence, it is clear that there was no deviation on the classification per se from the six digit classification system. The Commissioner clearly seems to be oblivious of this crucial aspect. There has been no change in the classification of the product, in question, under the 8 digit classification vide the 2005 amendment. The silos would still be classified under tariff item no. 8437 of the Central Excise tariff. The transition from six digit classification to eight digit classification is only for purposes of alignment and does not call for reclassification of the goods manufactured by the appellants. The issue of classification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng that the silo system manufactured by the appellants would merit classification under chapter 9406. It is not the claim of the department that the silo system supplied by the appellant would merit classification under chapter heading 94060093 which covers silos for storage of ensilage . Admittedly, the said classification has been ruled out. In such a situation, it is well settled that specific heading has to be preferred over residuary entry. The Revenue cannot keep raking the same issue over and over again. Once the issue has been decided by the highest appellate authority, the same cannot be re-opened under any new guise or pretext. No fresh facts have come to light. The factual position remains the same. Hence, the rule of constructive res judicata will apply in the facts of the present case. Therefore, the present proceeding is barred by the rule of res judicata. Reliance placed on the decision in Eminence Equipments Private Limited 2015 (330) ELT 344 is uncalled for. The facts of the said case are totally different and distinguishable from the facts of the present case. The Ld. Departmental Representative also submitted that there is no estoppel in law. He reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould apply in the instant case. the reasoning given in the impugned order by the Ld. Commissioner to seek classification of the silo system under tariff item no. 9406 0099 consists of structures with exterior walls and roof which is akin to a building. The appellants submit that this finding is completely contrary to factual position as explained above. The appellants submit that there are no walls or four corners in the silo system. The appellants submit that any and every structure cannot be considered as building. On a plain perusal of the above HSN, it becomes clear that the above chapter heading seeks to cover only prefabricated buildings meant to be used as housing, worksite, accommodation, offices, schools, shops sheds, garages and greenhouses. This is further evident from the fact that the said HSN refers to electrical fittings, heating and air conditioning equipment sanitary equipment, kitchen equipment and items of furniture. Obviously, the silo system, in the instant case, would not have any of the said equipments. Though this specific submission was made, the Ld. Commissioner chooses to conveniently ignore the same. Most importantly, there is no allega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpugned order submits: Appellants are claiming that the Silo System manufactured by them are classifiable under Ch. Sh.84379090. It is a well settled principle of law that the goods are to be assessed in the form in which they are at the time of their clearance as have been held in following cases. Dynaspede Integrated Systems P. Ltd. [1997 (89) E.L.T. 193 (Tribunal)] ( Sunil Industries [1999 (113) E.L.T. 931 (Tribunal)] Sanghi Polyesters Limited [2003 (155) E.L.T. 381 (Tri. - Bang.)] M.M. Rubber Co. Ltd. [1989 (41) E.L.T. 343 (Tribunal)] Vardhman Acrylics Ltd. [2002 (146) E.L.T. 604 (Tri. Del.)] Appellants are not manufacturing Silos System in the factory but even as per their own invoices and admission, what they manufacture and clear is silo or as per their invoices Components of Silo System , thus the classification of Silo System, which as per their own admission is immovable property, is not relevant. Ch. Sh. 8437 is classifying the excisable goods answering to the description of being Machines for cleaning, sorting or grading seed, grain or dried leguminous vegetables; machinery used in the milling industry or for the working o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various industrial units such as milling plants etc. for storage of purchased grains till it is used. Hence, Heading 84.37 which includes machinery used in the milling industry other than farm type machinery also is appropriate. It may be appreciated that even though the product was different ( SILO Grain Storage Complex ) from the present product Components/Accessories of GIC Silo System of the Assessee/Appellants, nowhere the Tribunal has held that the product was capable of cleaning, sorting or grading seed, grain or dried leguminous vegetables. The Tribunal also observed that ..from the list of customers produced before us, it appears that it is being used mostly by milling industry at present... Appellants contend that Silo System has accessories attached for multiple purpose of loading etc. However, this is not relevant as the issue is not of classification of Silo System but the excisable goods cleared as Components/accessories of Silo System and whether the same were answering to the requirement of present ch.Sh.8437 and perform the functions as stated therein in the state as cleared from the factor at the time of assessment. The Purchase Order is giving descr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. The Appellants claim that Chapter Note 4 to Chapter 94 is not applicable as they do not manufacture prefabricated building. The prefabricated buildings are defined under Chapter note/Section note 4. Since their product is squarely falling under the definition as elaborated in the OIO, the same is to be considered for classification under Ch.sh.94060099. Appellants contend that the silo system has no walls or corners. It is again repeated that the silos manufactured and cleared by the Appellants are only storage devices covered from all the sides and thus are specifically covered under ch.sh.94060099. The Appellants claim that reliance placed on amendment in 2005 from six digit to eight digit is irrelevant. The dispute is not just arisen due to shifting of six digit Tariff system to eight digit but the wrong classification of Silos in spite of there being a specific entry. The product manufactured and cleared during the disputed period is different from the product classified by the CEGAT in the Order [1996 (81) E.L.T. 417 (Tribunal)] dated 10/11/1995. There is no case laws which decides that even if there is new specific entry in the changed tariff, the old entry sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y virtue of CEGAT Order No. E-442 and 443/1995-B dated 10-11-1995 in their own case. As regards the description of goods under heading 8437 of the Central Excise Tariff Act 1985 and explanation thereof he stated that the entry in the chapter 8437 is for Machines for cleaning, sorting or grading seed, grain or dried leguminous vegetables machinery used in the milling industry or for the working of cereals or dried leguminous vegetables, other than farm type machinery . Regarding description of goods under the heading 94360093 and 94060099 of the Central Excise Tariff Act. 1985, he has stated that Chapter 94 contains furniture, bedding, mattress supports, cushions and similar stuffed furnishing, lamps and light fittings, not elsewhere specified or included; illuminated signs, illuminated name plates and the like; prefabricated building; as per CETH 94060093 it is mentioned as 'Silos for storing ensilage' and 94060099 is for 'Other'. 93.1.2. Shri Kishor Madhav Thatte, Vice President (Finance) and Company Secretary (notice no. 2) in his statement dated 20.01.2015 has stated that they manufacture Silos, which are dispatched in parts (in CKD condition); Silos insta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39; by them) by itself is only an equipment which can be used for storage of grains and is not a part of any machinery. The Silos manufactured at the factory are merely dismantled into CKD or SKD condition in order to enable them to be easily transported to the site of installation. It therefore appears that the classification under CETH 84379090 as a 'part/component' is not correct. The detailed discussions in this regard are herein below. 93.3. In common parlance Silo is a structure for storing bulk materials. They are used in agriculture to store grain or fermented feed known as silage. Silos are more commonly used for bulk storage of grain, cement, sugar etc. In this regard I find that as per the general rules of interpretation of Schedule to Central Excise Tariff, both prior to eight digit classification and subsequently too, any reference to an article if it has essential character of complete or finished goods, it should be classified as a finished article itself. For better appreciation, Rule 2(a) of General Rules for Interpretation of CETA, 1985 is reproduced below- Any reference in a heading to an article shall be taken to include a reference ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery. In the said heading I find that there is no specific mention of grain storing machine either singly or in association. with other equipment / machine so as to impute specific heading for the goods viz; Silos for storage as are manufactured/fabricated by the noticee no. 1 and declared in their brochure. In fact, there is no mention of Silos or storage device in said heading. Hence, I find that Silos manufactured by noticee no.1 do not fit the description under Chapter heading 8437 inasmuch as the Silos are used only for storage of grains as stated by the representative of noticee no. 1 in their various statements as also as is stated in their brochure. 93.3.3. On going through the statements of Shri Ajay Das Gupta of M/s. Gujarat Ambuja Exports Ltd., Shri Sanjay Jamdade of M/s. Millenium Starch India Pvt. Ltd. and Shri P.S.Inganahalli of M/s. Bilagi Sugar Mills Ltd. regarding the functions of Silos I find that Silos are used only for storage of maize and sugar of different grades. Silos do not consist of any mechanical device to perform the function of cleaning, sorting, grading of food grains as it does not consist of any mechanical device to do such functions. For carry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... machinery manufactured at the factory of noticee no. 1 that performs function of cleaning, sorting or grading seed, grain or dried leguminous vegetables or machinery used in the milling industry or for the working of cereals or dried leguminous vegetables, other than farm-type machinery. 93.3.5. In this regard, I reproduce below the explanatory notes to Chapter 8437- - MACHINES FOR CLEANING, SORTING OR GRADING SEED, GRAIN OR DRIED LEGUMINOUS VEGETABLES This heading covers machines, whether of horticultural, agricultural or industrial This heading covers machines, whether of horticultural, agricultural or industrial types, of a kind used for cleaning, sorting or grading cereal grains, dried leguminous vegetables, seeds, etc, by winnowing, blowing, sieving, etc. Such machines include: - Fanning mills consisting of a feeding hopper, a blower and sieves (usually vibrating). - Grading winnowers, rotating winnowers and seed or grain selectors, more complex machines which clean by means of air currents, and grade the seed or grain according to weight, size or shape. Some seed selectors, etc., incorporate auxiliary devices for coating the seeds with inse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich crush the grain into middling's, semolina and flour. -Reduction rolls or mills with smoother rollers, specially designed to convert middlings, semolina, etc., into flour. -Disintegrators or impact grinders used to grind down into flour, the meal, etc., which adheres to the mill or converter rollers in the preceding processes. -Feeders, machines designed to ensure a regular and even flow or grain to the crushing rollers. The heading does not include small farm type grinding mills (heading 84.36). - Machinery for the sorting or separation of flour from sharps or middlings. - This group included machines for separating the flour, meal, middlings, sharps, etc., produced by milling. - This separation is effected by a series of operations carried out on the following types of machines which are often used in series: -Sifting machines ( bolters ) for separating flour from groats and cereal Centrifugal sifters (or reels ) consist of drums fitted internally with beater bars and covered externally with gauze of various mesh sizes. Oscillating sifters or plansiffers consists of nests of free-swinging superimposed sieves and collec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he customer's site for installation. Also noticee no. 1 has not proved with evidence that the Silo manufactured by them performs the functions of cleaning, sorting, grading etc. without fitment of bought out accessories. Hence there cannot be any doubt that Siios are only a storage equipment and after addition of other accessories after installation at the site they do not fall under category of machinery , but rather can be broadly category as a structure. 93.3.7. From the said facts I am of the view that the classification of Silos under 84379090 is not justified on both counts: that it is not a 'part' of a machinery and it is not essentially a machinery to perform the function of cleaning, sorting or grading seed, grain or dried leguminous vegetables or a machinery used in the milling industry or for the working of cereals or dried leguminous vegetables. By wrongly attributing the functions of auxiliary machines which carry out certain definite functions to Silos manufactured by them, it appears that noticee no. I have mis-classified the Silos under Chapter 8437 for availing the unjustified benefit of clearing the same at Nil rate of Central Excise duty. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e submissions made by them, I find that they themselves have stated that Silos are having side walls and roof and are used for storing. They have also stated that Silos are assembled at the site of customer, with various accessories if required by the customers. Hence Silos are pre-fabricated in their factory premises and are transported in CKD condition and assembled at site of the customer. As per Note 4 to Section XX of Chapter 9406 prefabricated buildings' means buildings which are finished in the factory or put up as elements, cleared together, to be assembled on site, such as housing or work site accommodation, offices, schools, shops, sheds, garages, or similar buildings. The Silos manufactured by them are buildings which are manufactured and finished at the factory premises and are assembled on site of the customers. I therefore find that the Silos manufactured by the noticee no 1 squarely fit in the description of goods as prefabricated buildings . Silos are pre fabricated buildings is clearly evidenced from the fact for storing ensilage have specifically been classified under chapter subheading 94060093' hence it follows that Silos for storage of other materials ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce to Rule 2(a) and Rule 3 of the General Rules of Interpretation of the First Schedule to the Central Tariff Act, 1985 and Section Note 4 of section XX of Chapter 94, the Silos manufactured and cleared by noticee no. 1 are rightly classifiable under Chapter Subheading 94060099 of the First Schedule of Central Excise Tariff Act, 1985 and is subjected to normal rate of Central Excise Duty. I rely in the case of Commissioner of C.Ex., Ghaziabad Vs. International Tobacco Ltd-2009- TIOL-11-SC-CX wherein the Apex Court held that for classification, the basic character, function and use is more important than the name used in trade parlance . By applying the said principle for classification of Silo, I find that basic character of Silo manufactured by noticee no. 1 is that it is a prefabricated building since it is fully fabricated in their factory and thereafter cleared in CKD for installation at customer's site. The basic function and use of Silo is that it is used as storage device. Apex Court in the case of UOI Vs. Pesticides Mfg. and Formulators Association of India - 2002 146) ELT 19 (SC) has held that specific heading is to be preferred over a general heading and if there ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f classification since specific heading covering Silos is available in the Central Excise Tariff after 94060019 under the heading of -Other: 93.4.8. As regards their contention that classification by suppliers cannot be criteria/basis to change classification in their case, I find that nowhere in the show cause notice it has been alleged that they should have classified their product as per the classification of their inputs. Accordingly, their contention and the case laws relied upon in this context are not relevant in the present case. 93.4.9. As regards their contention that Silo can perform the function of cleaning, sorting, grading etc. I find that the said functions can be carried out by Silo only when it has been attached with various equipments/accessories which are bought out items from other suppliers of said accessories as mentioned above. I also find that they have not demonstrated any evidence as to how the function of cleaning, sorting, grading etc. is done by Silo manufactured by them without the fitment of accessories required for carrying out each of the function. 93.4.10. In view of the above, I conclude my findings that the Silos manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pre-cleaner, drum sieve, bag filter system, auto weighing machine, bag stitching, dust extraction, diverters which performs the functions of cleaning, grading or sorting of food grains or leguminous vegetables. I therefore find that there was no warrant for declaring Silos manufactured by noticee no. 1 as a system since it is only a storage equipment. 95.2. On going through para 12.1 of the show cause notice, I find that though the noticee no. 1 have supplied ladders, sealant, level switches, discharge gates, motorized gate and aeration fans and sweep auger (for flat bottom silos), I find that these are not machinery or equipment that can perform cleaning, grading or sorting of food grains or leguminous vegetables. In some cases, as per customer's specific requirement, catwalk way and vertical support from silos are provided. These are made of standard structural steel for providing support to the overhead conveyor. These also do not do the functions of cleaning, grading or sorting of food grains or leguminous vegetables. In some cases they provide temperature monitoring System which is used. only to monitor the temperature inside the silo and does not do the functions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s manufactured by noticee no. 1 as 'part' of machine or as a 'system' to fall under CETH 8437. 95.4. I find that in their statement dated 15.12.2014 Shri. D.B. Ghule, DGM- Productions and Shri. Suresh R. Thakar, General Manager of noticee no. 1, both, have specifically mentioned that Silos manufactured by them are storage equipments. Whereas Shri. Thatte, Vice President (Finance) and Company Secretary (noticee no.2) in his statement dated 08.08.2015 has stated that the Silos System inter-alia performs the functions of cleaning, sorting or grading and falls under Chapter 8437 of the CETA, 1985. From the above contradictory statements I find that he has frantically tried to prove the classification of Silos under Chapter heading 8437 of the CETA, 1985. I find that the contradictory statement as above of Shri. Thatte, Vice President (Finance) and Company Secretary(noticee no.2) who is incharge of indirect taxation and understands the financial implications of product description vis- -vis of those such as Shri. D.B. Ghule, DGM-Productions and Shri. Suresh R. Thakar, General Manager who are officers uninvolved in taxation matters, has proved the willful intention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he introduction of 8 digit tariff classification. From the said facts, I find that they deliberately did not revise the classification of the Silos and mis-stated the description of Silos with the sole motive of evading payment of appropriate Central Excise duty. Therefore, the case laws cited in this regard are not relevant. Accordingly, I hold that their contention regarding non invocation of extended period is not acceptable and extended period along with penal action and interest is rightly invokable. 95.6. As regards their contention in respect of non suppression of facts and non invocation of extended period, I find that they have stated that they are regularly filing ERI and that the department is well aware of the manufacture and clearances of Silos. In this context I find that in the self assessment era they should have revisited the classification and corrected the same on their own. In view of the same their contention is not acceptable. 96. From the facts discussed above and evidence on record I find that the noticee no. I have contravened the provisions of rule 2(a) and 3 of General Rules for interpretation of Central Excise Tariff Act, 1985 inasmuch as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase reported at [1996 (81) ELT 417 (T)] The relevant chapter headings are along with the relevant chapter notes is reproduced below: The relevant entries in the year 1993-94 Section XVI MACHINERY AND MECHANICAL APPLIANCES; ELECTRICAL EQUIPMENT; PARTS THEREOF; SOUND RECORDERS AND REPRODUCERS, TELEVISION IMAGE AND SOUND RECORDERS AND REPRODUCERS; AND PARTS AND ACCESSORIES OF SUCH ARTICLES 3. Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines designed for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function. 4. Where a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function covered by one of the headings in Chapter 84 or Chapter 85, then the whole falls to be classified in the heading appropriate to that function. 5. For the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MACHINERY AND MECHANICAL APPLIANCES; ELECTRICAL EQUIPMENT; PARTS THEREOF; SOUND RECORDERS AND REPRODUCERS, TELEVISION IMAGE AND SOUND RECORDERS AND REPRODUCERS; AND PARTS AND ACCESSORIES OF SUCH ARTICLES 8437 Machines for cleaning, sorting or grading seed, grain or dried leguminous vegetables; machinery used in the milling industry or for the working of cereals or dried leguminous vegetables, other than farm type machinery 84371000 - Machines for cleaning, sorting or grading seed, grain or dried leguminous vegetables 843780 - Other Machinery: 84378010 --- Flour mill machinery 84378020 --- Rice mill machinery 84378090 --- Other 843790 - Parts 84379010 --- Of flour mill machinery ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. It is, therefore, necessary that on the excise side also we have the same eightdigit classification. What we have found is that eight- digit classification helps both Trade and Revenue Department to identify a particular product and the heading under which it falls. Immediately the number of disputes comes down very sharply. There is transparency and there is reduction in the number of disputes. All these will facilitate trade. .. 4.5 India is signatory HSN Convention and Article 3 of the Convention provides as under: Article 3 Obligations of Contracting Parties 1. Subject to the exceptions enumerated in Article 4 : (a) Each Contracting Party undertakes, except as provided in subparagraph (c) of this paragraph that from the date on which this Convention enters into force in respect of it, its Customs tariff and statistical nomenclatures shall be in conformity with the Harmonized System. It thus undertakes that, in respect of its Customs tariff and statistical nomenclatures: (i) it shall use all the headings and subheadings of the Harmonized System without addition or modification, together with their related numerical codes; (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Silo simplicitor, which has been specifically classified under Chapter Heading 9406 as pre fabricated building. We do not find any support to the said argument from the tariff entries. The tariff entry, 9406 is in respect of pre-fabricated building , and the term pre-fabricated building has been defined by the Chapter Note 4. Chapter Note 4 was not amended as result of introduction of Eight Digit Classification Code. Further it is to be noted that the term pre fabricated building has been defined using the word mean , and as per the principles of interpretation, a definition using the word mean is restrictive in nature and limited to what has been stated therein. The HSN Explanatory Notes to chapter heading 9406 reads as under: This heading covers, prefabricated buildings , also known as industrialized buildings of all materials. These buildings, which can be designed for a variety of uses, such as housing, worksite, accommodation, offices, schools, shops sheds, garages and greenhouses, are generally presented in the form of: Complete buildings, fully assembled, ready for use; Complete buildings, unassembled; Incomplete buildings, whether or no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uildings (- single dash). Thus, the classification sought to be adopted by the department is other of other pre-fabricated buildings, can be sustained only if it is held that the impugned goods cleared by the appellant were classifiable as pre fabricated buildings . If that was the case then even prior to introduction of the Eight Digit Classification code, also the said goods would have merited classification under the Heading 940600. This was not even the argument ever before tribunal in the case of Thermax, decided earlier. Tribunal has in that case held as under: 5. It was their contention that it is classifiable as Agricultural machinery for storage of grains and oil seeds as it is intended for use by farmers and farmers cooperatives. It has devices for grain handling, loading and unloading and (sic) and safeguards grains against rains, rodents, insects and fungi so that they can be stored for a longer duration with no deterioration in quality. 6. The Silos are supplied with standard accessories as well as optional ones including a temperature sensing device and level indicator, ....... grain cleaner and begging system etc. 7. In this connection, he would a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the milling industry other than farm type machinery also is appropriate. 13. In this connection, he is filing a list of his main customers most of which are various mills using agricultural produce as for example, those having Soyabean or Mustard Oil plants or Barley Milling plants or Palm Kernel mill or Cattle feed milling plant, Sugar Mills or Grain Milling plants for distillary etc. 14. It was, therefore, his contention that their complex system was usable by farmers and agricultural cooperatives as well as by milling industry, and their main customers have been the later ones. 15. Therefore, it was their contention that their plant is classifiable under 84.37 and in the alternative under 84.36. 16. Learned counsel Shri Lakshmi Kumaran also stated that although their prayer is for classification under 84.36 but he has no objection if their product is held to be classifiable under 84.37 because it was usable by milling industry as well. 17. It was also the contention of both the ld. counsels that whether it is classified under 84.36 or 84.37 in either case the product will be eligible for the benefit of exemption Notification No. 111/88, dated 1- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only. In other words, it has multiple uses. In the circumstances, it can be classified only under 84.36 or 84.37 depending upon its principal use, standard and optional accessories. In America, this type of machinery is used by individual farmers also but in India, from the list of customers produced before us, it appears that it is being used mostly by milling industry at present. Hence, in our opinion, it will be more appropriate to classify it under Heading 84.37. 24. Headings [84.78] and 84.79 are residuary entries which can be considered only if a product could not be classified in any of the more specific headings. Since in our opinion, these plants are classifiable under 84.37, both 84.78 and 84.79 go out of picture. 4.10 In case of Quality Steel Products Pvt. Ltd [1993 (65) ELT 513 (T)] affirmed by the Hon ble Supreme Court as reported at [1996 (83) ELT A 106 (SC)], following was observed: Further, change in tariff does not change the nature of goods. It is true that 26AA (iv) of erstwhile Central Excise Tariff was wide compared to 7306.90 of the new Tariff and there was only one single entry covering all sorts of tubes and pipes as against number of sub-h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... change in law regarding the excisability on fresh mushrooms or dutiability on fresh mushrooms. In other words, the fresh mushrooms were excisable prior to the 2004 amendment and continue to be excisable subsequent to the 2004 amendment and, therefore, the decision rendered by the Commissioner of Central Excise (Appeals) on 27th May 2004 prior to the 2004 amendment was binding on the adjudicating authorities including the Commissioner of Central Excise even after the 2004 amendment to the 1985 Act. 4.12 In case of Amiya Corporation after referring to the HSN Explanatory Note for Heading 9406, Tribunal has observed as follows: 3. Revenue s case in the impugned orders is that since the appellants have supplied prefabricated structures, therefore, the prefabricated buildings are classified under Heading 94.06. We observe that every structure is not necessarily a building. The building must have a wall as is apparent from the HSN Explanatory Notes. We observe that there is no allegation whatsoever in all the impugned orders nor in the customers orders relied upon by the Revenue that the appellants herein have supplied panels for walls and roof. Therefore, in our considered op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransport many machines and apparatus are transported in an unassembled state. Although in effect the goods are then a collection of parts, they are classified as being the machine in question and not in any separate heading for parts. The same applies to an incomplete machine having the features of the complete machine (see Part (IV) above), presented unassembled (see also in this connection the General Explanatory Notes to Chapters 84 and 85). However, unassembled components in excess of the number required for a complete machine or for an incomplete machine having the characteristics of a complete machine, are classified in their own appropriate heading. (VII) FUNCTIONAL UNITS (Section Note 4) This Note applies when a machine (including a combination of machines) consists of separate components which are intended to contribute together to a clearly defined function covered by one of the headings in Chapter 84 or, more frequently, Chapter 85. The whole then falls to be classified in the heading appropriate to that function, whether the various components (for convenience or other reasons) remain separate or are interconnected by piping (carrying air, compressed g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uipment consisting of the welding head or tongs, with a transformer, generator or rectifier to supply the current (heading 85.15). (10) Portable radiotelephone transmitters and their associated hand microphone (heading 85.17). (11) Radar apparatus with the associated power packs, amplifiers, etc. (heading 85.26). (12) Satellite television reception systems consisting of a receiver, a parabolic aerial reflector dish, a control rotator for the reflector dish, a feed horn (wave guide), a polarizer, a low-noise-block (LNB) down converter and an infra-red remote control (heading 85.28). (13) Burglar alarms, comprising, e.g., an infra-red lamp, a photoelectric cell and a bell (heading 85.31). It should be noted that component parts not complying with the terms of Note 4 to Section XVI fall in their own appropriate headings. This applies, for example, to closed circuit video-surveillance systems, consisting of a combination of a variable number of television cameras and video monitors connected by coaxial cables to a controller, switchers, audio board/receivers and possibly automatic data processing machines (for saving data) and/or video recorders (for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the appellant while classifying the said goods under Heading 8437. We also take the note of the fact that this view has been expressed by the Chief Commissioner, under the scheme of eight digit classification code introduced by the Central excise Tariff Amendment Act, 2004. We also take note of the Shipping Bills field by the appellant classifying the same goods under CTH 843709090 and assessed by the Custom Authorities at Nhava Sheva under the said heading. 4.19 In view of the discussions as above we do not find any merits in the impugned order classifying the impugned goods cleared by the appellant under CETH 94060099 and demanding the duty accordingly. 4.20 When the issue was taken up and decided upto tribunal in 1995, all the facts were in the knowledge of the revenue since then. The amendment scheme of classification from 6 digit to 8 digit was introduced in 1995 and the Office of Chief Commissioner has rendered the opinion after examination of the issue on 9th January 2013, then it is not understood just for the change of opinion how can appellant be charged for suppression with intent to evade payment of duty subsequently for invoking extended period of limitation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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