Judgment:
1. The common question for consideration in these four appeals by the Commissioner is the classification of "power controllers" manufactured by each of the four respondents to these appeals. Each of them had, prior to July, 1990, classified the product under heading 84.43 of the tariff. Each of them claimed from 25-7-1991 onwards classification of the product under heading 8536.90 This classification was not accepted.
Notices were issued proposing to deny it, to confirm the classification earlier claimed and approved. The notices also proposed recovery of duty short paid, caused by the difference between the duty payable under each of the two headings. The Assistant Colector confirmed the classification of the goods under heading 8543, and consequent liability to duty. On appeal filed by the manufacturer against this order the Collector (Appeals) accepted the classification claimed by the manufacturers. Hence these appeals by the department."85.36 - Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits (for example, switches relays, fuses, surge suppressors, plugs, sockets, lamp-holders, junction boxes) for a voltage not exceeding 1000 volts.85.36.10 - Overload protection or thermal relay, starting relay controls, for refrigerating or air conditioning appliances and machinery.8536.90 - Other85.43 - Electrical machines and apparatus, having individual functions not specified or included elsewhere in this chapter." 3. What is therefore to be determined is whether the power controller is an article described under heading 85.36. If it is, it will be classifiable under sub-heading 90 of that heading. (It is nobody's case, that it is an article covered by sub-heading 10 of that heading.) If it is not, it will be classifiable under heading 85.43.
4. The precise function of the power controller has not been either in the department's appeals or in the replies or by any of the respondents. The department's appeals, which are commonly worded, say that the control also controls the degree of elimination and outflow of heat i.e. the function of light dimmer and speed control. Thus its main function is to control the degree of elimination and flow of heat although there is a reference to the literature relating to the product in the appeal, such a literature has not been enclosed. The respondents have merely enclosed a diagram of the electrical circuits in which the article is fitted. This only shows that it is a part of a circuit, for electrical supply of light to an electrical load described as heater or bulb. This shows it to be a switch in an electrical circuit. What we have gathered during the hearing is that it is an apparatus incorporating an electrical switch, which regulates the supply of voltage to the object, fan, electric lamp etc. to which it is connected.
5. The department's appeal emphasises the fact that the use of the product is to regulate the flow of electricity to the object in question, and therefore cannot be treated merely as an apparatus for making or protecting switching, or making connection or in electrical circuits.
6. Both headings are a reproduction of respective headings in the Harmonised System of Nomenclature (HSN) and reference to the Explanatory Notes of that nomenclature in determining the scope of the coverage of these headings is justified. Heading 85.36 speaks of Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits." Therefore, such apparatus which is intended solely or predominantly for any of these purposes, that would be classified under that heading. Electrical apparatus which are intended to perform other functions, and incorporating a switch, relay, fuse, or plug, cannot, solely by the fact of such incorporation, be considered to be apparatus for switching or protecting electrical circuits. If that were to be the case, every apparatus that incorporates a switch or fuse or other item mentioned in the heading would be classifiable under that heading. Thus, transformers, electric lamps or television receivers incorporating a fuse or the fuse to protect against overload, or a switch to turn on the circuit would be classifiable not under headings 85.04, 85.39 or 85.28 respectively but would be classifiable under heading 85.36. The absurdity of this conclusion shows the unacceptability of the reasoning advanced in its support. It is clear that heading 85.36 is for goods solely or essentially used for the purpose specified in that heading switching or protecting electric circuit, or making connection or any switch circuits. This article therefore cannot be classifiable under heading 85.36.
7. The contention that the power controller is used for making connection to electric circuit, for which a diagram is relied upon, is equally unacceptable. The diagram is misleading. It shows the power controller to be only a switch, by displaying a symbol used to portray a switch in such circuit diagrams. The article is much more than a switch. If it were only a switch, there would be no requirement for so constructing as to render it suitable for regulating the voltage. No manufacturer would spend money for making such a product nor would anyone buy it, if it were to put to use only as a switch.
8. Equally unacceptable is the claim that the article is used for protecting electrical circuits. No technical or other evidence has been cited to show that it has any features incorporated in it for protecting electrical circuits. The contention that the life of the circuit is prolonged because the required voltage is supplied to it may or may not be true. No evidence was produced to say that life of the circuit is increased by so doing, or that it decreases if the voltage falls to, or rises above, the prescribed voltage. Even assuming such a contention to be true, the article contributes to the prolonged life of the circuit. That is very different from saying that it protects the electrical circuit damage them from overload. From the Explanatory Notes, it is clear that this heading covers apparatus specifically defined to guard a circuit against overload. The fact that the heading excludes constant voltage transformers and an automatic voltage regulators make this clearer. The classification of the goods under heading 85.36 therefore cannot be accepted.
9. We now have to see the appropriateness of the classification claimed by the department under heading 85.43. It is the contention of the counsel for the respondent that for this heading to apply, the electric appliance, or apparatus under consideration must have individual functions. This contention has to be accepted. The heading itself requires this. That the apparatus in question has an individual function would be evident. Its function is to provide a source of current variable at the option of the user to the load to which it is connected. The Explanatory Notes to heading 85.43 provide that the introductory provisions or Explanatory Notes of heading 84.79 concerning machines and mechanical appliances having individual functions applies mutatis mutandis to the appliances and apparatus of this heading. The introductory part of that note reads as follows : "This heading is restricted to machinery having individual functions, which: (a) Is not excluded from this Chapter by the operation of any Section or Chapter Note and (b) Is not covered more specifically by a heading in any other Chapter of the Nomenclature and (c) Cannot be classified in any other particular heading of this Chapter since: (i) No other heading covers it by reference to its method of functioning, description or type, and (ii) No other heading covers it by reference to its use or to the industry in which it is employed, or (iii) It could fall equally well into two (or more) other such headings (general purpose machines).
"The machinery of this heading is distinguished from the parts of machinery, etc., that fall to be classified in accordance with the general provisions concerning parts, by the fact that it has individual functions.
"For this purpose the following are to be regarded as having "individual functions": (A) Mechanical devices, with or without motors or other driving force, whose function can be performed distinctly from and independently of any other machine or appliance.
(B) Mechanical devices which cannot perform their function unless they are mounted on another machine or appliance, or are incorporated in a more complex entity, provided that this function: (i) is distinct from that which is performed by the machine or appliance whereon they are to be mounted, or by the entity wherein they are to be incorporated, and (ii) does not play an integral and inseparable part in the operation of such machine, appliance or entity." 10. It is not the contention of the advocate for the respondent that, omitting heading 85.36, (which we have excluded) the goods are classifiable under any other heading of Chapter 85. The requirement of the first part of the note is therefore satisfied. It will be clear that the second part of the note refers to individual functions of machines in order to distinguish them from parts of machinery; that is what the note says, and explains that it is for this purpose provides guidelines to determine what "individual functions" are. It will be clear that the article in question is covered by Clause (A) of the note. It is an apparatus whose function can be performed distinctly from, and independently of, any other machine or appliance. The example given of air hu-midification and dehumidification as functions which can be performed by appliance operating independently of any other machine is significant. An air humidifier, even if designed to be mounted an ozone generator, in conjunction with, which it will be used, is specified as having an individual function.
11. The same consideration would apply to the goods before us. The provision of the required amount of electricity is an independent function that the article in question performs. The electricity so regulated can be supplied to one of a number of appliances, such as a lamp or a fan. The fact that the article cannot be used except in an electrical circuit, on which emphasis is placed by the respondent, therefore becomes irrelevant. That would be true of any electrical machine or apparatus. We cannot conceive of a single electrical machine or apparatus that can function unless it is part of an electrical circuit. Any electric appliance or apparatus has necessarily to be connected to an electrical circuit before it can function. This would be true even of such machine or apparatus having in built source of power such as a battery. Here too electrical circuit has to be completed before the machine or apparatus can function. Does this mean that no electrical machine or apparatus can be classified under heading 85.43? The answer is obviously in the negative. If it were not so answered, the heading itself would become redundant.
12. We therefore accept the department's contention that the goods are classifiable under heading 85.43. The appeals are allowed. Orders of the Collector (Appeals) are set aside and the Assistant Collector's orders restored.