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RANGANATH MISRA AND M.M. DUTT, JJ.
Civil Appeal No. 335 of 1987, D/- 18-9-1987.
Jain Engineering Co., Appellant
Versus
Collector of Customs, Bombay, Respondent.
Customs Act, 1962 – Section 130E - Customs Tariff Act, 1975 - Customs Duty - Benefit Of Notification - Exemption From Payment - Question that is involved in this appeal preferred is whether appellant is entitled to benefit of Notification No. 281-Cus/76, granting part exemption from payment of customs duty in respect of rod bushes and camshaft bushes imported by appellant - Whether bushes imported by appellant are really parts of such engines – Held, In view of court finding that Notification exempts also parts of engines, in order to avail of benefit of exemption granted by Notification, it has to be proved that parts in respect of which exemption is claimed are parts of internal combustion piston engine as mentioned under Heading No. 84.06 - Some of such parts may have been included under Heading No. 84.63 - In other words, as soon as it is proved that parts are of engines mentioned in Heading No. 84.06, such parts will get benefit of exemption as provided by Notification, irrespective of fact that they or any or some of them have already been included under Heading No. 84.63 or under any other Heading - Therefore, even if bushings are same as bearings, still they would come within purview of Notification, provided they are parts of engines mentioned under Heading No. 84.06 - Contention of customs authorities that article, which is provided under another Heading other than Heading No. 84.06, will not get exemption as provided in Notification is not readily understandable - When Notification grants exemption to parts of engines, as mentioned under Heading No. 84.06, court find no reason to exclude any of such parts simply because it is included under another Heading - Intention of Notification is clear enough to provide that parts of engines mentioned under Heading No. 84.06, will get exemption under Notification and in absence of any provision to contrary, court is unable to hold that parts of, engines which are included under a Heading other than Heading No. 84.06 are excluded from benefit of Notification – Court set aside order of Appellate Tribunal and of customs authorities and send case back to Collector of Customs with a direction to decide, after giving an opportunity to appellant, whether bushes imported by appellant are parts of internal combustion piston engines as mentioned under Heading - Appeal Allowed.
Judgement
DUTT, J. :- The only question that is involved in this appeal preferred under S. 130E, Customs Act, 1962, is whether the appellant is entitled to the benefit of the Notification No. 281-Cus/76, granting part exemption from payment of customs duty in respect of the rod bushes and camshaft bushes imported by the appellant.
2. Before we refer to the said Notification, we may notice the provisions of the Heading No. 84.06 and Heading No. 84.63 of the Customs Tariff Act, which are as follows :-
Heading No. Sub-heading No. and description of article Rate of duty Central Excise Tariff Item
(a) Standard
(b) Preferential areas
84.06 Internal combustion piston engines. (a) 100% 29
84.63 Transmission shafts, cranks, bearing housings, plan shaft bearings, gears and gearings (including friction gears and gearboxes and other variable speed gears), flywheels, pulleys and pulley blocks, clutches and shaft couplings. (a) 60%
(1) Not elsewhere specified. (a) 60%
(2) Plan shaft bearings with or without bearing housing. (a) 100%
3. The said Notification No. 281-Cus. dated 2-8-1976, as amended from time to time, reads as follows :
"Notfn. No. 281-Cus. - The articles specified in column (2) of the Table hereto annexed and falling under Heading No. 84.06 are exempt from so much of that portion of the duty of Customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975, as is in excess of the rate specified in the corresponding entry in column (3) of the said Table.
THE TABLE
Description of article Rate of duty
(2) (3)
Stationary or industrial internal combustion piston engines and parts thereof excluding those which are inter-changeable for use with motor vehicle other than those specified against S. No. 2. 40 percent ad valorem.
Internal combustion piston engines for industrial and agricultural tractors and power tillers and parts thereof excluding those which are inter-changeable for use with other motor vehicles. 40 percent ad valorem.
Marine engines and parts thereof excluding those which are inter-changeable for use with motor vehicles other than those specified against Sl. No. 2 40 percent ad valorem.
Internal combustion piston engines designed for use in aeroplanes and parts of such engines. 3 percent ad valorem.
Internal combustion piston engines for locomotives and parts thereof excluding those which are inter-changeable for use with motor vehicles other than those specified against Sl. No. 2." 40 percent ad valorem.
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