K.L. Rekhi, Member (T)

1. A common issue is involved in these 19 appeals, they relate to the same appellants and were argued before us together. This combined order will dispose of all of them.

2. The appellants imported Connecting Rod forgings and Cross forgings, made of steel, for eventual use in the manufacture of their two-wheeler and three-wheeler scooters. The lower authorities had assessed the goods to basic customs duty under Heading 84.06 (as part of internal combustion engine) and 87.09/12(1) (as part of scooter) respectively, with additional customs duty under Item 26AA of the Central Excise Tariff in some cases and under Item 68 thereof in others. In doing so, the lower authorities have held that by application of the Interpretative Rule 2(a) of the Customs Tariff Act 1975, both the goods were deemed finished components. The appellants' prayer is that the goods in both cases were only rough forgings, that Interpretative Rule 2(a) was not applicable and that the basic customs duty should be assessed only under Heading 73.06/ 07(2) as rough forgings and the additional customs duty should be assessed uniformly under Item 26AA of the CET only. This is the common point of dispute in all the 19 appeals.

3. The arguments of the appellants are two-fold :

(1) The Interpretative Rule 2(a) could not apply to their goods which, as imported, were totally unmachined. They very fairly referred to the Larger Bench judgment of this Tribunal [MANU/CE/0296/1986 : 1987 (28) ELT 545 - BHEL] which had evolved certain norms on the scope and meaning of Rule 2(a). They pleaded that the norms laid down by the Larger Bench were cumulative and ultimately the Larger Bench had laid down that each case had to be decided on its own merits. Coming to the merits of their own case, they argued that their goods, as imported, were totally unmachined rough forgings only. After importation, the Connecting, Road forgings underwent 38 different operations. Similarly, the Cross forgings underwent 20 different operations. It was only thereafter that the two became finished components of 1C engineers and scooters. The post-importation processes were mechanical, chemical and electrical in both cases. They produced certain samples of the goods as imported and as they became after all the post-importation operations were over in support of their pleadings. The appellants admitted that the samples were not certified ones, but they added that there was nothing on record to doubt the genuineness of the samples as produced by them.

(2) The predecessor Appellate Collector had held in his order dated 5-4-1980 that the goods were unmachined rough forgings only and that, therefore, they were classifiable under Chapter 73 of the CTA. This order was not revised by the Central Government and hence it became final. The Department followed this order for about three years. The successor authorities, could, no doubt, change the classification prospectively but they could do so only for sound and cogent reasons vide 1983 ELT 328 (Delhi) -J.K. Synthetics Limited. No such sound or cogent reasons had been brought on record.

4. The learned representative of the Department argued, with the help of the invoices and drawings placed on record by the appellants, that both the goods as imported satisfied each and every norm laid down by the Larger Bench of this Tribunal in the case of BHEL aforesaid. However, so far as the additional customs duty is concerned, he accepted the position, in view of the earlier judgments of this Tribunal, that since the Central Excise Tariff had no such thing as the Interpretative Rule 2(a), the additional customs duty could be levied only under Item 26AA (steel forgings) of that Tariff.

5. We have given the matter our earnest consideration. It is not in dispute that the Interpretative Rule 2(a) is a statutory part of the Customs Tariff Act, 1975 and it has to be given its due weight. The material portion of this Rule reads as follows :

"2(a) Any reference i