Judgment:
1. The issue involved in this appeal filed by M/s Pack Plast Industries is whether the parts of humidification and ventilation plants are classifiable under Heading 84.79 of the Schedule to the Central Excise Tariff Act as claimed by the appellant or under Chapter 39 of the Tariff as confirmed by the Collector (Appeals) under the impugned order.
2. Shri L.P. Asthana, ld. Advocate submitted that though number of items were involved in the impugned order, the appellants are pressing their appeal only in respect of "Mist Eliminators". The ld. Advocate further submitted that humidification plants are plants which create humidity in areas where specific relative humidity is desired; that initially the parts of humidification plants were manufactured out of G.I. Sheets or mild steel; that with advent of technology, these parts are being now manufactured out of plastics, so that no corrosion takes place and parts have longer life span. he also explained the manner in which the humidification plants operates; that fans suck required quantity of ambient air through Dampers; this air is spread over Louvers/perforated sheets uniformly before entering air washer; in the space called Air Washer, water is injected through nozzles so that mist is generated; the air entering through Louvers carries this mist and becomes totally saturated having relative humidity of nearly 90-95%; that this air is made to pass through Mist Eliminators, so that water droplets are not carried over further and highly saturated air is taken through Ducts to departments and spread there through diffusers/Grills.
He also mentioned that Mist Eliminator is being solely or principally used as part of humidification plant; that as per Note 2(b) to Section XVI, parts which are suitable for use solely or principally with a particular kind of machine, machinery etc., falling under Chapter 84 or 85 are to be classified with the machines; that further Note 2(o) to Chapter 39 clearly provides that Chapter 39 does not cover articles of Section XVI; that Mist Eliminator is not a part of general use as defined in Note 2 to Section XV and as such it cannot be classified under Heading 39.16 of the Tariff as Profiles. The ld. Counsel also emphasised that it is not the case of the Department that the Mist Eliminator is not meant for humidification plant. He relied upon the decision in the case of CCE, Meerut Vs. Unicast (P) Ltd. [1999 (113) E.L.T. 161 (T)] wherein it was held that cooling tower parts, not shown to be the parts of general use is classifiable under Heading 84.19 of the Central Excise Act in terms of Note 2 to Section XVI.3. Countering the argument, Shri Ashok Kumar, ld. DR submitted that Mist Eliminator is nothing but PVC Profiles which are classifiable under Heading 39.16 of the Tariff. He relied upon the decision in the case of Collector of C.EX. Bombay Vs Industrial Coordinators [1998 (103) E.L.T. 49 (T)] wherein it was held that proforated PVC strips/PVS lug protector are to be classified under Sub-heading 3926.20 as "other articles of plastics" and not as parts of electric accumulator under Sub-heading 85.07. Reliance was also placed on the decision in the case of Nova Iron and Steel Ltd., V. Collector of Central Excise, Raipur [1997 (95) E.L.T. 495 (T)] wherein it was held that hollow profiles of iron and steel were classifiable under Heading 73.08 as these were more in the nature of structures and not used in manufacture of tubes or pipes of chimney.
4. We have considered the submissions of both the sides. It has not been denied by the Revenue that the Mist Eliminators are used in the manufacture of humidification plant. We observed from the perusal of the impugned order that the Collector (Appeals) did not accept the contention of the appellants as the articles were also sold as such and the appellants had not substantiated that these parts were used as a replacement of worn out parts of humidification/ventilation plants. It is thus apparent from this finding in the impugned order that use of the Mist Eliminator in humidification plant was not in dispute and what was not substantiated by the appellants was only the fact that all the goods in question which were cleared as such and it was not shown that these were used as replacement parts. The appellants have themselves given up their appeal in respect of items except Mist Eliminator. In view of the fact that the use of Mist Eliminator in humidification plant is not disputed by the Department, it has to be classified along with humidification plant in view of Note 2(b) to Section XVI of the Tariff. According to this note, parts, if suitable for use solely or principally with a particular kind of machine, are to be classified with the machine of that kind. The exception to the note is that parts of general use will not be covered by Section XVI, which covers Chapters 84 and 85. Mist Eliminator is not, according to Note 2 Section XV parts of general use. No evidence has also been adduced by the Department to show that Mist Eliminator is part of general use. The ratio of the decision in the case of Nova Iron and Steel (supra) is not applicable as it was found in that case that hollow profiles were not used in the manufacture of tubes and pipes of chimney and, therefore, they could not have been classified under Chapter 84. Similarly, in the case of Industrial Coordinators (supra), the Tribunal observed tat the Department had not backed its case that perforated PVC strips were used in the manufacture of electric accumulators by any technical material.
In the present matter, the appellants have mentioned that the air which is sucked through fans is made to pass through Mist Eliminator, so that water droplets are not carried over further. In view of this, the Mist Eliminator has to be classified under Heading 84.79. As far as the classification of other gods in question is concerned, the ld. Advocate has not pressed the matter and, accordingly, the other goods will remain classified under Chapter 39 and in the Headings and Sub-headings as ordered by both the lower authorities. The appeal is thus allowed only in respect of Mist Eliminator.