K.L. Rekhi, Member (T)

1. The dispute in this appeal is on classification of certain ladle equipment, imported by the appellants, for the purpose of levy of customs duty.

2. The appellants submitted before us during the hearing that a ladle consisted of 12 parts out of which they imported 10 parts in unassembled condition. The remaining two parts - the vessel and piping - were procured by them locally. They stated that the value of these two parts procured locally was about 2% of the value of the total ladle equipment. Relying on the affidavit dated 6-6-1984 of Dr. V.D. Sehgal, a Metallurgist, the appellants contended that the equipment imported by them, 'though incomplete to form a complete ladle, had collectively acquired the essential character of a vacuum degassing ladle as that expression was understood in the Metallurgical trade. The appellants prayed that the entire equipment as imported by them should be assessed under Heading 84.43 of the Customs Tariff Act, 1975.

3. We find from the record that out of the equipment imported by the appellants, the Collector (Appeals) had already ordered the classification of "Ladle Refining Equipment" under Heading 84.43. But he ordered that the remaining 2 items in the equipment should be classified as under :-

(1) Vacuum Degassing Equipment - Under Heading 84.59(2).

(2) Vacuum Pumps - Under Heading 84.11(1).

The dispute that now survives before us is, therefore, in respect of the above two items only.

4. Before starting the discussion, we reproduce the three headings involved in the dispute :-

"84.11 Air Pumps, vacuum pumps and air or gas compressors (including motor and turbo pumps and compressors, and free-piston generators for gas turbines); fans, blowers and the like :

(1) Not elsewhere specified.

(2) Gas compressors imported for use in air-conditioning equipment.

(3) Gas compressors imported for use in refrigerating equipment.

(4) Exhaust fans and blowers of not less than 65 centimeters sweep; flame-proof fans and blowers.

(5) Fans and blowers not falling within sub-heading (4).

84.43 Converters, ladles, ingot, moulds and casting machines, of a kind used in metallurgy and in metal foundries.

84.59 Machines and mechanical appliances, having individual functions, not falling within any other heading of this Chapter :

(1) Not elsewhere specified.

(2) Machines and mechanical appliances designed for the production of a commodity, machinery for treating metals, wood or similar materials, for stripping and cutting of tobacco leaf or for cutting or rolling tea leaves; machines for mounting card clothing; nuclear reactors."

5. We have given the matter our careful consideration. According to the affidavit of Dr. V.D. Sehgal, a ladle "is essentially a refractory lined vessel to contain the molten metal". The appellants did not import the vessel. They imported only the lid or cover of the ladle. They may be right in arguing that the lid is the main thing, both from the point of view of the cost as well as the technology that has gone into it, yet when the vessel which is to contain the molten metal is absent, it cannot be said that the remaining equipment was nothing but a slightly incomplete vessel or ladle. In our view, the lid alone cannot be equated with the whole vessel. We, therefore, do not agree with the opinion of Dr. V.D. Sehgal that the incomplete equipment imported by the appellants had acquired the essential character of a vacuum degassing ladle. Rule 2(a) of the Rules of Interpretation for the Customs Import Tariff has no application to the facts of this case. The incomplete equipment could not be classified under Heading 84.43 as if it were a complete ladle.

6. At the same time, we do not consider that the Collector (Appeals) was correct in classifying the vacuum degassing equipment under Heading 84.59(2), which is in the nature of a residuary item. From the catalogue and the other materials placed on record by the appellants, we are satisfied that the goods imported by the appellants wer