TMI Blog2023 (12) TMI 386X X X X Extracts X X X X X X X X Extracts X X X X ..... biliser is only as an accessory to the vehicle as an antitheft device, adding value to the vehicle in terms of security, the question of classifying the same under Chapter Heading 8536 does not arise. Moreover, it is to be classified as part of motor vehicle unless excluded by the Section or Chapter Notes or if there is a specific entry in the Tariff as per the General Explanatory Notes. As already discussed, it is rightly classifiable under Chapter Heading 8708 as there is no specific entry elsewhere. Therefore, since the smartra immobiliser is only a security device to prevent a vehicle from being stolen it is rightly classifiable under Chapter Heading 8708 as parts of motor vehicle. When the primary evidences and criteria for classification do not allow classifying the items under Chapter Heading 8536, the question of following the Tariff Advice which is only a persuasive value does not arise. The impugned order is set aside - Appeal allowed. - HON BLE MR. P. A. AUGUSTIAN, MEMBER ( JUDICIAL ) And HON BLE MRS R. BHAGYA DEVI , MEMBER ( TECHNICAL ) For the Appellant : Mr. K. A. Jathin , AR For the Respondent : Ms. Neetu James , Advocate ORDER Per R. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be classified under chapter heading 8536 as other switches . The Authorised Representative further submitted that it is nothing but an antitheft device which prevents engine to start if the previously registered key is not presented and therefore, it is an accessory of the vehicle rightly classifiable under Chapter Heading 8708 9900 which covers other parts and accessories of motor vehicles of heading 8701 to 8705. 3. On the other hand, the learned advocate for the respondent submits that the HSN Explanatory Notes to Chapter Heading 8536 reads as apparatus for switching electrical circuits. The imported goods are nothing but an electronic chip consisting of transistor and logic chip for a voltage not exceeding 1000 volts. It is submitted that the device switches on the EMS, when the appropriate signal is received from the transponder, i.e., the impugned goods make it circuit. If the appropriate signal is not received from the transponder, then the engine itself cannot be turned on by the user of the vehicle and therefore, it is rightly classifiable under Chapter Heading 8536. Relying on HSN Explanatory Notes under the heading parts and accessories it is submitted that if any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es; parts 8708 93 00 --Clutches and parts thereof 8708 94 00 -- Steering wheels, steering columns and steering boxes; parts thereof 8708 95 00 --Safety airbags with inflater system; parts thereof 8708 99 00 -- Other Section XVI Note 2 reads as 2. Subject to Note 1 to this Section, note 1 to Chapter 84 and to note 1 to Chapter 85, parts of machines (not being parts of the articles of heading 8484, 8544, 8545, 8546 or 8547) are to be classified according to the following rules: (a) parts which are goods included in any of the headings of Chapter 84 or 85 (other than headings 8409, 8431, 8448, 8466, 8473, 8487, 8503, 8522, 8529, 8538 and 8548) are in all cases to be classified in their respective headings; Section XVII: Vehicles, Aircraft, Vessels and Associated Transport Equipment Notes: 1. This Section does not cover articles of heading 9503 or 9508 or bobsleighs, toboggans and the like of heading 9506. 2. The expressions parts and parts and accessories do not apply to the following articles, whether or not they are identifiable as for the goods of this Section: (a) joints, washers or the like of any material (classif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tarted unless the correct key is present and thus, prevents the vehicle from being stolen. Under no circumstances, this can be considered as switch to be classified under Chapter Heading 8536. 9. Moreover, the HSN Notes under parts and accessories of Clause A, B and C reads as: (A) Parts and Accessories excluded by Note 2 to Section XVII (B) This note excludes the following parts and accessories, whether or not there are identifiable as for the articles of this section: --- 7. Electrical machinery or equipment of Chapter 85 for example: -- (k) Pantographs and other current collectors for electric traction vehicles, and refuses, switchers and other electrical apparatus of heading 8535 or 8536. (B) Criterion of sole or [principal] use. (1) Parts and accessories classifiable both in Section XVII and in another Section. Under Section Note 3, parts and accessories which are not suitable for use solely or principally with the articles of Chapters 86 to 88 are excluded from those Chapters. The effect of Note 3 is therefore that when a part or accessory can fall in one or more other Sections as well as in Section XVII, its final classificati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heading 8708.00 as claimed by the assessee and not under chapter heading 9401.00 as put forth by the revenue. Tribunal came to the conclusion that the items manufactured by the assessee are only adjuncts, additions to the seats for the better utilization of the seats for comfort and convenience of the passengers and they are not essential components or parts of seats. That the seats are complete in themselves without these mechanisms and therefore do not merit classification as parts of seats under Chapter 9401.00. Tribunal relying upon a judgment of this Court in the case of Mehra Brothers v. Joint Commercial Officer reported in 1991 (51) E.L.T. 173 (S.C.) held that products manufactured by the assessee merited classification under chapter heading 8708.00 as parts and accessories of motor vehicles . 21. Chapter heading 8708 covers both the parts as well as accessories . The items manufactured by the assessee are only adjuncts. These are to be affixed on the floor of motor vehicles. When seats are affixed on these rails, seats can slide back and forth with the operation of a lever forming part of other rail assembly front seat adjuster. This enables the driver or the passe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ii) Junction boxes under sub-heading 8536.90.30; and (iv) others under sub-heading 8536.90.90. Chapter 86 covers Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures and fittings and parts thereof; mechanical (including electro-mechanical) traffic signalling equipment of all kinds. Chapter Heading 8608 covers Railway or tramway track fixtures and fittings; mechanical (including electro-mechanical) signalling safety or traffic control equipment for railway, tramways, roads, inland waterways, parking facilities, port installation or air-fields; parts of the foregoing . --the answer to question revolves around the description of goods found in Chapters 85 and 86, as well as the Notes in Section XVII and the General Rules for Interpretation of the First Schedule. We have already extracted the description of goods in Chapters 85 and 86. Therefore, let us now take note of the relevant Notes in Section XVII and the relevant Rule of the General Rules for Interpretation of the First Schedule. Section 2 of the Central Excise Tariff Act, 1985 provides that the rates at which duties of excise shall be levied under the Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to (a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable. (c) when goods cannot be classified by reference to (a) or (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration. In the case on hand, the claim of the assessee was that the relays manufactured by them were part of the railway signalling equipment. But all the Authorities were of the unanimous view that this product is referable to goods of a specific description in Chapter sub-heading 8536.90 and that, therefore, General Rule 3(a) will apply. But in invoking General Rule 3(a), the Authorities have omitted to take note of 2 things. They are : (i) that as laid down by this Court in Commissioner of Central Excise v. Simplex Mills Co. Ltd. [(2005) 3 SCC 51 = 2005 (181) E.L.T. 345 (S.C.)] the General Rules of Interpretation will come into play, as mandated in Rule 1 itself, only when no clear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r accessory. What is recognized in Note 3 can be called the suitability for use test or the user test . While the exclusion under Note 2(f) may be of goods which are capable of being marketed independently as electrical machinery or equipment, for use otherwise than in or as Railway signalling equipment, those parts which are suitable for use solely or principally with an article in Chapter 86 cannot be taken to a different Chapter as the same would negate the very object of group classification. This is made clear by Note 3. It is conceded by the Revenue that the relays manufactured by the appellant are used solely as part of the railway signalling/traffic control equipment. Therefore, the invocation of Note 2(f) in Section XVII, overlooking the sole or principal user test indicated in Note 3, is not justified. On the question as to what test would be appropriate in a given case, this court pointed out in A. Nagaraju Bros. v. State of A.P. [1994 Supp (3) SCC 122 = 1994 (72) E.L.T. 801 (S.C.)], as follows : ..there is no one single universal test in these matters. The several decided cases drive home this truth quite eloquently. It is for this reason probably ..... X X X X Extracts X X X X X X X X Extracts X X X X
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