Collector of Central Excise Vs. Sayaji Iron Works - Court Judgment

Excerpt:
1. in this appeal filed by the revenue the issue for our consideration is whether mouting on which concrete mixer machines are fixed, are trailers for the purpose of item no. 34 of the old central excise tariff. assistant collector, central excise, baroda has observed that goods in question were classifiable under item no. 34 and not under item 68 of the tariff. he had ruled in his order that lower portion (base portion) was not considered to be trailers by the assessee only on the ground that it did not require registration under the motor vehicle act. he observed that requirement of motor vehicle act had no relevance to the dispute before him. on the analogy that trollys used for carrying mobile compressors (under carriage) were classifiable under item 34, he decided the classification under item no. 34 as against earlier classification under item no. 68. on appeal, collector of central excise (appeals), bombay allowed the appeal of the respondents before us m/s. sayaji iron works (contracts) pvt. ltd., baroda and observed that goods were to be classified on the basis of the trade parlance and that the goods were classified under item 68.2. the matter was heard on 16-8-1996 when shri m. haja mohideen, jdr appeared for the appellant-revenue and shri a.p. hathi, advocate appeared for the respondents.3. shri m. haja mohideen stated that base portion of mixers which were used for transporting mixer from one place to another was in the nature of trailers and were correctly classified under item 34 by the assistant collector. he referred to the explanatory notes to the harmonized commodity description and coding system and pleaded for vacation of the order of collector of central excise (appeals). in reply, shri a.p. hathi, advocate submitted that as per settled position the excisable goods had to be classified as per trade understanding and the order passed by the collector of central excise (appeals) is correct.4. we have carefully considered the matter. the classification of trailer under item no. 34 of the old central excise tariff is in context of motor vehicles and tractors. tariff descriptions covered motor vehicles and tractors including trailers. a trailer is a non-mechanically propelled vehicle and designed to be coupled to another vehicle by means of a special coupling device. it moves with the vehicle to which it is attached and is dragged by that vehicle and it stops when not dragged. in the case of kb. dani v. state of karnataka reported in 1979 sales tax cases, volume 44 at page 246, karnataka high court had observed that tractor-trailer was a mere receptacle made to certain specifications and is mounted on wheels.5. in the explanatory notes to the hsn referred to by the learned jdr, it has been mentioned in chapter heading 87.16 at page 1439 of volume iv that trailers are non-mechanically propelled vehicles equipped with one or more wheels and constructed for the transport of; goods or persons. they are/ designed to bestowed by other vehicles (tractors, lorries, trucks, motorcycles, bicycles etc.) to be pushed or pulled by hand or to be drawn by animals. trailer has been further defined as. to mean vehicle (other than side car) of a kind designed solely to be coupled to another vehicle by means of a special coupling device whether or not automatic.6. in the case before us, there is no dispute that concrete mixer machine and roller pan mixer machine were classifiable under tariff item 68, but dispute was only about the lower/base portion of those products which were provided with wheels to facilitate their movement from one place to another. the whole of the machine could be towed by motor vehicle but the mounting was designed to keep the mixer machine on it. the lower/base portion on which the machine was placed could not be, as such, used for transportation of goods or by persons.7. collector (appeals) had recorded that lower frame portion was an integrated and essential component/part of the machine and machine was provided with pneumatic wheels. they are not sold as trailer and were not; used as trailer as known in the trade/industry.8. on going through the entry no. 34 of the tariff, trade understanding of the product trailer and nature of the goods in question, we find no ground to interfere with the order passed by the collector of central excise (appeals), baroda. we find no merit in this appeal by the revenue. the same is rejected.

Judgment:
1. In this appeal filed by the Revenue the issue for our consideration is whether mouting on which Concrete Mixer machines are fixed, are trailers for the purpose of Item No. 34 of the old Central Excise Tariff. Assistant Collector, Central Excise, Baroda has observed that goods in question were classifiable under Item No. 34 and not under Item 68 of the Tariff. He had ruled in his order that lower portion (base portion) was not considered to be Trailers by the assessee only on the ground that it did not require registration under the Motor Vehicle Act. He observed that requirement of Motor Vehicle Act had no relevance to the dispute before him. On the analogy that Trollys used for carrying mobile compressors (under carriage) were classifiable under Item 34, he decided the classification under Item No. 34 as against earlier classification under Item No. 68. On appeal, Collector of Central Excise (Appeals), Bombay allowed the appeal of the respondents before us M/s. Sayaji Iron Works (Contracts) Pvt. Ltd., Baroda and observed that goods were to be classified on the basis of the trade parlance and that the goods were classified under Item 68.

2. The matter was heard on 16-8-1996 when Shri M. Haja Mohideen, JDR appeared for the Appellant-Revenue and Shri A.P. Hathi, Advocate appeared for the respondents.

3. Shri M. Haja Mohideen stated that base portion of mixers which were used for transporting mixer from one place to another was in the nature of trailers and were correctly classified under Item 34 by the Assistant Collector. He referred to the Explanatory Notes to the Harmonized Commodity Description and Coding System and pleaded for vacation of the order of Collector of Central Excise (Appeals). In reply, Shri A.P. Hathi, Advocate submitted that as per settled position the excisable goods had to be classified as per trade understanding and the order passed by the Collector of Central Excise (Appeals) is correct.

4. We have carefully considered the matter. The classification of trailer under Item No. 34 of the old Central Excise Tariff is in context of Motor Vehicles and Tractors. Tariff descriptions covered motor vehicles and tractors including trailers. A Trailer is a non-mechanically propelled vehicle and designed to be coupled to another vehicle by means of a special coupling device. It moves with the vehicle to which it is attached and is dragged by that vehicle and it stops when not dragged. In the case of KB. Dani v. State of Karnataka reported in 1979 Sales Tax Cases, Volume 44 at page 246, Karnataka High Court had observed that Tractor-trailer was a mere receptacle made to certain specifications and is mounted on wheels.

5. In the Explanatory Notes to the HSN referred to by the learned JDR, it has been mentioned in Chapter Heading 87.16 at page 1439 of Volume IV that Trailers are non-mechanically propelled vehicles equipped with one or more wheels and constructed for the transport of; goods or persons. They are/ designed to bestowed by other vehicles (tractors, lorries, trucks, motorcycles, bicycles etc.) to be pushed or pulled by hand or to be drawn by animals. Trailer has been further defined as. to mean vehicle (other than side car) of a kind designed solely to be coupled to another vehicle by means of a special coupling device whether or not automatic.

6. In the case before us, there is no dispute that Concrete Mixer Machine and Roller Pan Mixer Machine were classifiable under Tariff Item 68, but dispute was only about the lower/base portion of those products which were provided with wheels to facilitate their movement from one place to another. The whole of the machine could be towed by Motor Vehicle but the mounting was designed to keep the mixer machine on it. The lower/base portion on which the machine was placed could not be, as such, used for transportation of goods or by persons.

7. Collector (Appeals) had recorded that lower frame portion was an integrated and essential component/part of the machine and machine was provided with pneumatic wheels. They are not sold as trailer and were not; used as trailer as known in the Trade/Industry.

8. On going through the Entry No. 34 of the Tariff, Trade understanding of the product Trailer and nature of the goods in question, we find no ground to interfere with the order passed by the Collector of Central Excise (Appeals), Baroda. We find no merit in this appeal by the Revenue. The same is rejected.