TMI Blog2023 (10) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... is drawn that the appellant s activity of manufacturing loader independently occurs by taking various alteration and since it is to be fitted in the tractor therefore, the assessee s activity is under manufacture of the whole vehicle but limited to manufacture of loader. Merely by fitting such loader which is manufactured and mounted on the tractor, cannot be said to be amounting to manufacture of special purpose motor vehicle classifiable under heading 8705. In case of manufacture of special purpose motor vehicle, the fabrication and mounting of special purpose body of motor vehicle is fabricated and mounted on the chassis. In the present case, tractor is already manufactured and in majority of cases the clients use his tractor for some time and thereafter it is given to the assessee only for fitting loader in the fully manufactured tractor. The Adjudicating Authority after analyzing relevant Chapter notes of the tariff as well as Chapter note of HSN has rightly interpreted that the tractor alone is of no use and it is used as a power machine for the purpose of use of tractor and different equipment is fitted in the tractor. Therefore, the equipment such as loader in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01.03.2003 as amended. It was further alleged that the respondent are liable to pay Central Excise duty on Loaders manufactured by them including the price of the tractors in terms of Rule 6 of the Central Excise (Valuation of Price of Excisable Goods), Rules, 2000. 3. Shri Tara Prakash, learned Deputy Commissioner (AR) appearing on behalf of the Revenue reiterates the findings in the grounds of appeal. He submits that since the appellant have fabricated loader and mounted on the tractor given by their customer, the overall activity amounts to manufacture of Special Purpose Motor Vehicle and correctly classifiable under Chapter heading 8705. 4. Shri D.D. Rishi, learned Counsel appearing on behalf of the assessee submits that they received already manufactured and complete tractor from their customers either as a new one or after use for a long period only for attaching loader manufactured by the assessee. Therefore the activity of the assessee is manufacturing of loader and when it is attached to a tractor it is nothing but accessory of the tractor and therefore it is correctly classifiable under Chapter heading 8708. Accordingly, the assessee has correctly availed SSI exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. In the present case, tractor is already manufactured and in majority of cases the clients use his tractor for some time and thereafter it is given to the assessee only for fitting loader in the fully manufactured tractor. In this regard we refer to the Chapter Note 2 of Chapter 87 which defines the tractor, the same is reproduced below:- Chapter Note 2 of the Chapter 87 of the Tariff: 2. For the purposes of Chapter 87, tractors meant vehicles constructed essentially for hauling or pushing another vehicle, appliance or load, whether or not they contained subsidiary provision for transport of tools, seeds, fertilizers or other goods . Machines and working tools designed for fitting to tractors of heading 8701 as interchangeable equipment remain classified in their respective headings, even if presented with the tractor, and whether or not mounted on it. Chapter Note 2 in HSN Explanatory Note to Chapter 87 reads as 2. For the purposes of this Chapter, tractor means vehicles constructed essentially for hauling or pushing another vehicle, appliance or load, whether or not they contain subsidiary provision for the transport, in connection with the main use of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n such a case, the interchangeable working tools are classified in their appropriate headings, even if presented with the tractor, and whether or not mounted on it, while the tractor with its operating equipment is classified in this heading. From the above explanatory note, it was made very clear that any inter-changeable working tools in normal course are classified in their appropriate headings. However, in case of tractor operating equipment fitted with the tractor is classified in the heading of tractor only. In the present case since loader is inter-changeable loading equipment fitted with the tractor, it is properly classifiable as accessory of tractor under Chapter 8708. 7. We find that the Adjudicating Authority after analyzing relevant Chapter notes of the tariff as well as Chapter note of HSN has rightly interpreted that the tractor alone is of no use and it is used as a power machine for the purpose of use of tractor and different equipment is fitted in the tractor. Therefore, the equipment such as loader in the present case is part of tractor which is much different from the vehicles classifiable as a special purpose motor vehicle under Chapter heading 8705. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tachment namely M/s Bull Machines, Pvt. Limited. Coimbatore, who also manufactures loader and mounts the same on buyers tractor. They supply these loaders as tractor attachment. Claiming the leader as interchangeable equipment, the Noticee argued that their case is falling under chapter note 2 of Chapter 87 and the loader is classifiable under it's own respective heading. 3.4.2 In this regard, it is useful to refer to relevant Tariff Notes and Explanatory Notes, as under: Chapter Note 2 of the Chapter 87 of the Tariff: 2. For the purposes of Chapter 87, tractors meant vehicles constructed essentially for hauling or pushing another vehicle, appliance or load, whether or not they contained subsidiary provision for transport of tools, seeds fertilisers or other goods Machines and working tools designed for fitting to tractors of heading 8701 as interchangeable equipment remain classified in their respective headings, even if presented with the tractor, and whether or not mounted on it. Chapter Note 2 in HSN Explanatory Note to Chapter 87 reads as 2. For the purposes of this Chapter, tractor means vehicles constructed essentially for hailing or pushi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the power of tractor for it's application(s) either from front, rear or side. As such the loader manufactured by the Noticee is an interchangeable tractor attachment for implementing loading tasks in farm, construction or industry. The Noticee also provided photographs of various types of tractor attachments which are interchangeable and mounted on a tractor to implement it's task. The Notice also demonstrated by video that the loader manufactured by them can be easily mounted and dismantled from the tractor. 3.4.5 Fromthe material before me, including photographs, various videos etc. I find that the tractor loader is an interchangeable attachment to tractor. The same can be mounted and dismantled like other attachments of the tractor Therefore, in light of the Chapter Note 2 of chapter 87 and it's Explanatory Notes, supra, once it is clear that the attachment, namely loader in an inter-changeable equipment, the same is required to be classified separately in it's respective heading, even if presented with tractor and whether or not mounted on tractor. 3.4.5 Thus, the attachment, namely loader' fabricated and mounted on the tractor of buyer, as an interc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is required to intimate RTO if any change is hurtle in the vehicle after registration of vehicle e.g. if petrol motor car converted into CNG or LPG fuel car. The tractor prior to fitment of loader is non-transport category vehicle and even after fitment it remains as non-transport category vehicle. 3.5 Now, I take up the question that if loader is to be classified separately in it's respective heading, what is the appropriate heading. The Notice drew attention toward classification of similar loader by M/s Bull Machines Pvt. Ltd. Coimbatore and produced copies of invoices issued by the said company showing classification of such loader as accessories of tractor under Cluster Heading 87.08 of the Central Excise Tariff. In this regard. I find that the loader is a specially designed equipment for use with tractor and it cannot be used elsewhere. The loader by nature enhances the specific utility of tractor. The tractor means a vehicle constructed essentially for hauling or pushing another vehicle, appliance or load, whether or not they contain subsidiary provision for transport of tools, seeds, fertilisers or other goods. Accordingly, the loader in a subsidiary provision to tr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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