S.L. Peeran, Member (J)

1. The revenue is aggrieved with the order-in-appeal passed by Ld. Collector (Appeals), Bombay allowing the benefit of S. No. 32 of the Notification No. 125/86-Cus., dated 17-2-1986 to the goods declared in the bill of entry dated 19-10-1987 as "Multi Layer (5 layers) co-extrusion machine and spare parts thereof on the ground that what is imported is a multi-layer film blowing plant for efficient co-extruded film manufacture with enormous versatility and the whole plant cannot be brought under the purview of "multi-layer extruding machine".

2. The ld. Collector (Appeals) has held in his order as follows :

"From the catalogue produced it is seen that the sub-assemblies or parts imported are all essential parts of the 3-layer blown film line and except for die-head all parts have been imported. The die-head is the only part which is interchangeable and all other parts are specially designed for the system for production of multi-layer co-extruded film and the end-product cannot be produced without any one of these parts and these parts are not of any material use in isolation. As per Note 5 to Section XVI 'machine' means any machine, apparatus or appliance of a kind falling Under Section XVI and as per Note 3 to Section XVI composite machine consisting of two or more machines fitted together to form a whole and other machines adopted for the purpose of performing two or more complementary or alternative functions are to be classified as consisting only of that component as being that machine which performs the principal function. The impugned machine parts as a whole perform the function of multi-layer co-extruding machine and are, therefore, classifiable as such under the heading and are also eligible to benefit of Notification No. 125/86-Cus.

The appeal is accordingly allowed."

3. We have heard Shri B.K. Singh, Ld. SDR for the revenue and Shri D.B. Shroff, Ld. Advocate for the importer.

4. Shri B.K. Singh, Ld. SDR strenuously argued the case of the Revenue and has contended that the benefit of the notification in question can be granted only to an Extruder and not to a extruder plant. Taking us through the technical literature and documents relied by the importer, Ld. SDR pointed out that the importer had changed the description of the machine in the invoice and bill of entry as the bank documents show a different description. He argued that it is clear that the importer had changed the description solely with a view to take advantage of the notification. He argued that the set of machinery in the form of a plant is required to be classified as per Section Note and Chapter Note. But those Section/Chapter Notes do not apply while interpreting the benefit of the notification. In this regard, he relied on the ruling rendered in the case of Johnson Johnson Ltd. v. Collector of Central Excise -MANU/CE/0115/1987 : 1987 (29) E.L.T. 428 (para 16), Collector of Customs v. OEN India Ltd. - MANU/CE/0611/1987 : 1989 (42) E.L.T. 235. Referring to the process of the entire plant, Ld. SDR argued that the multi-layer film emerges before the other extruding processes are taken up and hence the other equipments like cooling ring, guiding unit, film collapsing unit, take-off unit, winding, slitting unit etc. are not part and parcel of the multilayer co-extruding machine. They also do not form an integral part of the co-extruding processing machine. To buttress his arguments, Ld. SDR referred to the definition of the term "Extrusion" appearing at page 283 of Mc Graw Hill Technical Dictionary Vol. 5 1982 Edition and at page 808 of Webster English Dictionary 1991 Edition. He submitted that the function of extrusion machine was only to convert thermoplastics into continuous stream of melt, and any activity beyond this would not be included in the multi-layer co-extruding machine. He also referred to the technical literature referred by the Importer including to the certificates from experts to make his point that the process