Paharia Marbles Industries Vs. Collector of Customs - Court Judgment

Excerpt:
1. the appellants imported 'saw blades suitable for bra make marble cutting machine'. the invoice described the goods as of size 3950 x 180 x 3.5 mm covered by 31 segments. the goods were assessed to duty under heading 82.01 /04 of the cta and under heading 51a of central excise tariff for countervailing duty. the importers contested the classification and claimed classification under heading 82.06 read with heading 84.45/48 attracting rate of duty under notification 57/82-customs and filed refund claim for the differential duty. in support of their claim, they cited an order dated 1-7-1979 of the appellate collector of customs passed in the case of identical goods wherein assessment under heading 82.01/04 was rejected in preference to classification under heading 68.01/16(2). reliance was also placed on an order of the collector of customs (appeals) dated 25-4-1984 holding similar goods in the case of same importers as classifiable under heading 82.06 read with heading 84.45/48 read with notification no.57/82. the assistant collector rejected the refund claim holding that the original assessment made by the customs was correct. the collector (appeals) in his order dated 21-1-1986 upheld the lower authority's order. in holding so, he differed with his previous order dated 25-4-1984 on the ground that no evidence had been placed on record to show that the goods were identical. holding that the goods were in the nature of saw blades, he upheld the classification made by the customs.the present appeal is against this order.2. shri n.c. sogani, learned consultant argued the case for the appellants. revenue was represented by shri m. ah, learned departmental representative.3. shri sogani stated that the impugned goods were blades brazed with segments, 31 segments on each blade were placed at a distance of 90 mm to 120 mm from each other. such plates were fixed on the cutting machine to saw a number of pieces at one time by to and fro action. the segments were made of carbide/graphite material and not of metal. the cutting portion was made of the mixture of abrasive material and diamond powder. it was claimed that heading 82.01/04 covered the impugned goods because they did not have teeth nor could they be covered under the description 'toothless saw blades,' which cut by the friction of metal itself whereas in the present case, the cutting was done by the segments. it was claimed that series of peripheral inserts of abrasive material were excluded in terms of explanatory notes to heading 82.02 to the ccn. citing the relevant portion from the ccn relating to heading 68.04, it was claimed that only those saws which have cutting teeth and which are covered by abrasives would fall under 82.02 and the impugned goods would fall under heading 82.06 only.reference was again made to the two orders of the two collector (appeals) dated earlier than the impugned appeals, to support the various claims made by them. shri sogani referred to the following judgment and claimed that the decisions were relevant:collector of customs v. manjushree minerals ltd. 2. 1990 (50) e.l.t. 536 (tribunal) - granite (india) v. collector of cus. & c. ex.as regards the classification under cet, the learned consultant fairly conceded that since the heading was very specific, the goods cannot be classifiable under heading 51a of cet. shri ali, the learned department representative reiterated the order of the lower authorities.4. we have carefully considered the submissions made by both the sides.the two decisions cited before us are not relevant to the facts of the present case. the appellants cannot derive any benefit from the order of the appellate collector of customs dated 7-10-1979, since the classification was adjudged by him under heading 68, the benefit of which has not been claimed by the appellants in the present case. the collector in the impugned order has given reasons for his differing with his own earlier order. therefore, no force can be derived by the appellants from the earlier order of the collector, either.5. the customs tariff as it stood at the time of importation of the goods was a modified version of the harmonised coding system. of the heading 82.01/04 cta the portion which related to the disputed goods reads as "...and blades for hand or machine saws including toothless saw blades...". this specific description occurred in heading 82.02 cta read as 'knife and cutting blades for machines or for mechanical appliances'. in the hsn this description occurred in 82.08. the rate of duty for the goods falling under this heading was the one applicable to the machines with which the goods were designed to be used which machines were classifiable under heading 84.45/48.6. the dispute narrows down to whether the disputed goods are 'saws' or whether they are 'knives and cutting blades'. these terms although described in the various notes, have not been defined in the tariff.the mcgraw hill dictionary of science and technology terms defines 'knife' as 'a sharp, edged blade for cutting'. it describes a saw as "any of various tools consisting of a thin, usually steel, blade with continual cutting teeth on the edge." heading 82.08 covers knives and blades for metal working, for weld working, for kitchen appliances for agricultural, horticulture or forestry machines. the residuary category includes such goods used in the leather, paper, textile, plastic or tobacco processing industry. this description shows that the blades and knives are instruments which cut with the cutting edge. the description of the contested goods does not make for their inclusion under heading 82.06 of the customs tariff act or 82.08 of the hsn.7. the action of sawing consists of to and fro action. it has come in the appeal memorandum that marble is cut by segments mounted on the steel blade by the to and fro sawing action. in the explanatory notes to heading 82.02, the following is stated : "saw blades may have integral teeth or be fitted with necessary teeth or segments...which may be wholly of base metal, or of a base metal fitted or covered with metal carbides, diamond or in some cases with adhesive powder." 8. during the hearing, it was emphasised that the cutting segments were combination of carbides. these carbides are set on the blade which blades are mounted on the cutting machine. this clearly shows that the contested goods are covered under the description "saw blades". thus, on the basis of the dictionary definitions and the chapter notes, we find no merit in the claim with the contested goods merit classification under heading 82.06.9. since the appellants are not contesting the classification under the cet for computation of additional duty of customs, we uphold the impugned order and reject this appeal.

Judgment:
1. The appellants imported 'Saw blades suitable for BRA make marble cutting machine'. The invoice described the goods as of size 3950 x 180 x 3.5 mm covered by 31 segments. The goods were assessed to duty under Heading 82.01 /04 of the CTA and under Heading 51A of Central Excise Tariff for countervailing duty. The importers contested the classification and claimed classification under Heading 82.06 read with Heading 84.45/48 attracting rate of duty under Notification 57/82-Customs and filed refund claim for the differential duty. In support of their claim, they cited an order dated 1-7-1979 of the Appellate Collector of Customs passed in the case of identical goods wherein assessment under Heading 82.01/04 was rejected in preference to classification under Heading 68.01/16(2). Reliance was also placed on an order of the Collector of Customs (Appeals) dated 25-4-1984 holding similar goods in the case of same importers as classifiable under Heading 82.06 read with Heading 84.45/48 read with Notification No.57/82. The Assistant Collector rejected the refund claim holding that the original assessment made by the Customs was correct. The Collector (Appeals) in his order dated 21-1-1986 upheld the lower authority's order. In holding so, he differed with his previous order dated 25-4-1984 on the ground that no evidence had been placed on record to show that the goods were identical. Holding that the goods were in the nature of saw blades, he upheld the classification made by the Customs.

The present appeal is against this order.

2. Shri N.C. Sogani, learned Consultant argued the case for the appellants. Revenue was represented by Shri M. AH, learned Departmental Representative.

3. Shri Sogani stated that the impugned goods were blades brazed with segments, 31 segments on each blade were placed at a distance of 90 mm to 120 mm from each other. Such plates were fixed on the cutting machine to saw a number of pieces at one time by to and fro action. The segments were made of carbide/graphite material and not of metal. The cutting portion was made of the mixture of abrasive material and diamond powder. It was claimed that Heading 82.01/04 covered the impugned goods because they did not have teeth nor could they be covered under the description 'toothless saw blades,' which cut by the friction of metal itself whereas in the present case, the cutting was done by the segments. It was claimed that series of peripheral inserts of abrasive material were excluded in terms of Explanatory Notes to Heading 82.02 to the CCN. Citing the relevant portion from the CCN relating to Heading 68.04, it was claimed that only those saws which have cutting teeth and which are covered by abrasives would fall under 82.02 and the impugned goods would fall under Heading 82.06 only.

Reference was again made to the two orders of the two Collector (Appeals) dated earlier than the impugned appeals, to support the various claims made by them. Shri Sogani referred to the following judgment and claimed that the decisions were relevant:Collector of Customs v. Manjushree Minerals Ltd. 2. 1990 (50) E.L.T. 536 (Tribunal) - Granite (India) v. Collector of Cus. & C. Ex.

As regards the classification under CET, the learned Consultant fairly conceded that since the heading was very specific, the goods cannot be classifiable under Heading 51A of CET. Shri Ali, the learned Department Representative reiterated the order of the lower authorities.

4. We have carefully considered the submissions made by both the sides.

The two decisions cited before us are not relevant to the facts of the present case. The appellants cannot derive any benefit from the order of the Appellate Collector of Customs dated 7-10-1979, since the classification was adjudged by him under Heading 68, the benefit of which has not been claimed by the appellants in the present case. The Collector in the impugned order has given reasons for his differing with his own earlier order. Therefore, no force can be derived by the appellants from the earlier order of the Collector, either.

5. The Customs Tariff as it stood at the time of importation of the goods was a modified version of the Harmonised Coding System. Of the Heading 82.01/04 CTA the portion which related to the disputed goods reads as "...and blades for hand or machine saws including Toothless saw blades...". This specific description occurred in Heading 82.02 CTA read as 'knife and cutting blades for machines or for mechanical appliances'. In the HSN this description occurred in 82.08. The rate of duty for the goods falling under this heading was the one applicable to the machines with which the goods were designed to be used which machines were classifiable under Heading 84.45/48.

6. The dispute narrows down to whether the disputed goods are 'saws' or whether they are 'knives and cutting blades'. These terms although described in the various notes, have not been defined in the tariff.

The McGraw Hill Dictionary of Science and Technology Terms defines 'knife' as 'a sharp, edged blade for cutting'. It describes a saw as "any of various tools consisting of a thin, usually steel, blade with continual cutting teeth on the edge." Heading 82.08 covers knives and blades for metal working, for weld working, for kitchen appliances for agricultural, horticulture or forestry machines. The residuary category includes such goods used in the leather, paper, textile, plastic or tobacco processing industry. This description shows that the blades and knives are instruments which cut with the cutting edge. The description of the contested goods does not make for their inclusion under Heading 82.06 of the Customs Tariff Act or 82.08 of the HSN.7. The action of sawing consists of to and fro action. It has come in the appeal memorandum that marble is cut by segments mounted on the steel blade by the to and fro sawing action. In the Explanatory Notes to Heading 82.02, the following is stated : "Saw blades may have integral teeth or be fitted with necessary teeth or segments...which may be wholly of base metal, or of a base metal fitted or covered with metal carbides, diamond or in some cases with adhesive powder." 8. During the hearing, it was emphasised that the cutting segments were combination of carbides. These carbides are set on the blade which blades are mounted on the cutting machine. This clearly shows that the contested goods are covered under the description "Saw blades". Thus, on the basis of the dictionary definitions and the Chapter Notes, we find no merit in the claim with the contested goods merit classification under Heading 82.06.

9. Since the appellants are not contesting the classification under the CET for computation of additional duty of Customs, we uphold the impugned order and reject this appeal.