Full Judgment Text
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CASE NO.:
Appeal (civil) 151 of 2002
PETITIONER:
M/s Sterlite Industries (India) Ltd
RESPONDENT:
Commissioner of Customs, Chennai
DATE OF JUDGMENT: 19/03/2007
BENCH:
S. H. Kapadia & B. Sudershan Reddy
JUDGMENT:
J U D G M E N T
KAPADIA, J.
This civil appeal has been filed by M/s Sterlite Industries
(India) Ltd. under section 130E of the Customs Act, 1962
against Order No. 1113 of 2001 passed by CEGAT ("the
Tribunal") on 13.7.2001.
The short question which arises for determination in this
civil appeal is whether Fully Automated Sequential X-ray
Spectrometer is an apparatus based on the use of X-ray under
sub-heading 9022.19 as claimed by the Department or
whether the said apparatus is classifiable as Spectrometer
under sub-heading 9027.30 being an apparatus for physical
or chemical analysis.
To decide the above question, we quote hereinbelow the
following Heading of Chapter 90 of the Customs Tariff Act,
1975 which reads as under:
"CHAPTER 90
OPTICAL, PHOTOGRAPHIC, CINEMATOGRAPHIC,
MEASURING, CHECKING, PRECISION, MEDICAL OR
SURGICAL INSTRUMENT AND APPARATUS; PARTS AND
ACCESSORIES THEREOF \026
Tariff
Item
Description of goods
Rate of duty
Std. Prefnl.
9022
Apparatus based on the
use of X-rays or of
alpha, beta or gamma
radiations, whether or
not for medical,
surgical, dental or
veterinary uses,
including radiography
or radiotherapy
apparatus, X-ray tubes
and other X-ray
generators, high tension
generators, control
panels and desks,
screens, examination or
treatment tables, chairs
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and the like.
-Apparatus based on
the use of X-rays,
whether or not for
medical, surgical,
dental or veterinary
uses, including
radiography or
radiotheraphy
apparatus:
9022.12
--Computed
tomography apparatus
30%
..
9022.13
--Other, for dental uses
30%
..
9022.14
--Other, for medical,
surgical or veterinary
uses
30%
..
9022.19
--For other uses
-Apparatus based on
the use of alpha, beta
or gamma radiation,
whether or not for
medical, surgical,
dental or veterinary
uses, including
radiography or
radiotherapy apparatus:
50%
..
9022.21
--For medical, surgical,
dental or veterinary
uses
30%
..
9022.29
--For other uses
50%
..
9022.30
-X-ray tubes
50%
..
9022.90
-Other, including parts
and accessories
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50%
..
Xxx
Xxx
Xxx
9027
Instruments and
apparatus for physical
or chemical analysis
(for example,
polarimeters,
refractometers,
spectrometers, gas or
smoke analysis
apparatus);
instruments and
apparatus for
measuring or checking
viscosity, porosity,
expansion, surface
tension or the like;
instruments and
apparatus for
measuring or checking
quantities of heat,
sound or light
(including exposure
meters); microtomes
9027.10
-Gas or smoke analysis
apparatus
25%
..
9027.20
-Chromatographs and
electrophoresis
instruments
25%
..
9027.30
Spectrometers,
spectrophotometers and
spectrographs using
optical radiations (UV,
visible, IR)
25%
..
9027.40
-Exposure meters
25%
..
9027.50
-Other instruments and
apparatus using optical
radiations (UV, visible,
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IR)
25%
..
9027.80
-Other instruments and
apparatus
25%
..
9027.90
-Microtomes; parts and
accessories"
25%
..
The assessee imported Fully Automated Sequential X-ray
Spectrometer from M/s Rigaku International Corporation,
Japan. The said equipment is used by the assessee in its plant
at Tuticorin. The said Spectrometer was imported for analyzing
various alloys in the manufacture of Cathodes. The assessee
filed its Bill of Entry for home consumption. They claimed
assessment under sub-heading 9027.00. They claimed the
benefit of partial exemption Notification No. 46/96-Cus dated
23.7.1996. They paid customs duty (basic at 25% plus 10%
additional customs duty). The Department, however, assessed
the above apparatus under sub-heading 9022.19, quoted
above, read with the above notification and charged customs
duty (basic) at 50% ad valorem plus 10% additional customs
duty.
Basically, according to the Department, Spectrometer in
the present case was X-ray based Spectrometer and, therefore,
the same was classifiable in sub-heading 9022.19. According
to the Department, X-ray based apparatus stood covered
under section XVIII of HSN also and, therefore, the goods were
classifiable under sub-heading 9022.19.
According to the assessee, in the present case, the
Spectrometer in question is specifically named in sub-heading
9027.30. According to the assessee, the Department had erred
in placing reliance on HSN when the Customs Tariff Act, 1975
has specifically laid down Rules of interpretation. According to
the assessee, Rule 3(a) of the Rules of Interpretation was
applicable which says that the heading which provides a
specific description shall be preferred to headings which
provide general description. According to the assessee, under
Heading 90.27 the above item Spectrometer has been
mentioned without any qualification regarding the source
material and, therefore, the Spectrometer is based on optical
source, the X-ray source was immaterial as Spectrometer per
se was classifiable under sub-heading 9027.30. Before us, the
assessee submitted, in the alternative, for the first time, that
the above Fully Automated Sequential X-ray Spectrometer
could fall under sub-heading 9027.80 as Special Apparatus.
We have gone through the literature/ brochure
concerning Fully Automated Sequential X-ray Spectrometer.
We find from the brochure that the above System which is
imported by the assessee is multi-functional. It has an inbuilt
software. It has an inbuilt automatic analysis program. It is
the software in the System which makes the system carry out
multi-purpose functions. The computer processes the data.
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The configurations are also specified in the assembly of the
Spectrometer. Prima facie it appears that there is an inbuilt
computer system in the Spectrometer. That computer appears
to be an essential part of direct reading. These aspects have
not been considered by the authorities below. The catalogue/
brochure produced indicates that the Spectrometer in
question would be non-functional without the computer.
Modern direct reading Spectrometer incorporates a computer
in the System so that they can measure, process and analyse
the data. The catalogue shows the configurations which
indicate prima facie that the computer stands integrated with
the Spectrometer. The catalogue indicates the type of
apparatus. The catalogue shows inclusion of software
programmes and computer. The catalogue shows that the
Spectrometer is so designed that it functions in an integrated
manner along with the computer and can be operated and
controlled only with such computer. None of these aspects had
been considered by the authorities below including the
Tribunal. Hence, we remit the matter to the Tribunal to decide
the matter de novo after examining the catalogue annexed as
Annexure-B in its records. Before concluding, we may mention
that our above opinion should not be treated as conclusive.
The Tribunal can also consider the alternative submission of
the assessee, namely, that the above item can fall also within
sub-heading 9027.80. In this regard we express no opinion.
For the above reasons, the impugned order dated
13.7.2001 of the Tribunal (CEGAT) is set aside and the matter
is remitted to the Tribunal for its fresh decision in accordance
with law after examining the catalogue annexed in its record.
This appeal is accordingly allowed with no order as to
costs.