ORDER
S.L. Peeran, Member (J)
1. In all these appeals, a common question arises, hence they are all taken up together for disposal as per law.
2. E 2780/91, 4584/91 & 3368/92-B1:
The appellants are manufacturing Bushing Kits, suspension bushes, Steering Boot, Centre Bearing Rubber, Front Shock Absorber etc. and other parts. They had been filing classification list w.e.f. 13-5-1986 and declaring these goods as classifiable under sub-heading 4017.00 and declared in the classification list as Articles of synthetic vulcanised rubber (other than Hardened Rubber, claiming benefit of the Notification No. 216/86-C.E., dated 2-4-1986. In the classification list w.e.f. 16-4-1987, the goods had been classified under subheading 4016.19. The department issued show cause notice dated 18/20-7-1989 to the appellants on the ground that the goods are classifiable under chapter sub-heading No. 87.08 w.e.f. 1-4-1989 as motor vehicle parts at 20% ad valorem Short levy demand of Rs. 1,09,944.23 under Rule 9(2) read with Section 11A of Central Excises & Salt Act, 1944 for the period 20-2-1989 to 31-7-1989 was also demanded.
3. E/56/93-B1:
The appellant filed classification list w.e.f. 1-4-1991 seeking classification list of Motor vehicle parts made from vulcanised rubber other than hard rubber under sub-heading 4016.19. They have pleaded that the department had been approving this classification since 1986 to 1990. However, Assistant Collector modified the classification list and had the goods to be classifiable under sub-heading 8708.00 vide his order 7/92 dated 15-1-1992, which came to be confirmed in appeal. A duty demand for Rs. 74,915/17 has also been confirmed.
4. E 2361/92-B and E 58/93-B1:
The demand pertains to the period October 1991 to February 1992 for Rs. 1,19,922.62 on the same issue as in above cases. The appellant has also filed classification list w.e.f. 19-6-1986 onwards, wherein the department had confirmed the classification list under sub-heading 4016.19, which now they have charged and confirmed demands under sub-heading 8708.00.
5. We have heard Shri Harbans Singh, ld. Advocate and Shri K.R. Chopra, ld. Consultant for the appellants and Shri S.K. Sharma, ld. JDR for the Revenue, perused the records and carefully considered the submissions of either side.
6. The Bench had directed the department to draw the samples and seek the report of the Chemical Examiner, in respect of the impugned goods. The Superintendent of Central Excise by his letter dated 1-6-1993 addressed to ld. JDR, which has been filed before, has sent the report of the Chemical Examiner dated 31-5-1993 which reads as follows :
“Each of the five samples is in the form of black coloured rubber article (three bushes, one washer and one pad). Each is composed of synthetic rubber, natural rubber, carbon black, sulphur, zinc oxide and other organic compound. Each is vulcanised rubber other than hard rubber.”
7. Now the question is as to which of the completing entry is proper for the purpose of classification.
The respective heading reads as follows :
"40.16 (other articles of vulcanised rubber other than hard rubber) - Articles of materials of Heading No. 40.08 4016.11... of cellular rubber 60% 4016.19... other 15%" "87.08 8708.00 Parts and accessories of the motor vehicles of Heading Nos. 87.01 to 87.05 20%"
This Chapter 87 falls under Section XVII. Therefore, the section notes would squarely apply for the purpose of interpretating the tariff entries.
“2. The expression “parts” and “parts and accessories” do not apply to the following articles, whether or not they are identifiable as for the goods of this section :-
(a) Joints, washers and the like of any material (classified according to their constituent material or in Heading No. 84.84) and other articles of vulcanised rubber other than hard rubber (Heading No. 40.16);
(b) Parts of general use, as defined in Note 2 to Section XV, of base metal (Section XV), or similar goods of plastics (Chapter 39);
(c) Articles of Chapter 82 (tools);
(d) Articles of Heading No. 83.06;
(e) Machines and apparatus of Heading Nos. 84.01 to 84.79, and parts thereof; articles of Heading No. 84.81 or 84.82 and, provided they constitute integral parts of engines or motors, articles of Heading No. 84.83;
(f) Electrical machinery and equipment (Chapter 85);
(g) Articles of Chapter 90; (h) Articles of Chapter 91; (h) Arms (Chapter 93);
(k) Lamps and lighting fittings of Heading No. 94.05;
(l) Brushes of a kind used as parts of vehicles (Heading No. 96.03).”
As can be seen from the Note 2(a) above,
“Other articles of vulcanised rubber other than hard rubber (Heading No. 40.16)” do not come within the expression of “parts” and “parts and accessories.”
The Chemical Examiner’s report clearly states that the goods are “vulcanised rubber other than hard rubber”. Therefore, the controversy is put to rest by this report and the classification under sub-heading 4016.19 as claimed by the appellants, cannot be disputed.
8. The Board by the Circular No. 12/89-CX. 4, dated 4-4-1989 have also clarified that
“oil seals wholly of rubber, or where rubber is predominant or gives essential character would be appropriately classifiable under Heading 40.16 and not under Chapter 87.”
Likewise by Circular No. 27/88-CX. 3, dated 1-11-1988, they have clarified that “vulcanised (other than hardened) non-cellular rubber profiles with metal inserts (when metal is inserted at the time of extrusion itself) would be appropriately classifiable under sub-heading No. 4008.29 of the Central Excise Tariff Act, 1985”. In these appeals admittedly metal is not used in the impugned goods, hence the classification under sub-heading 4008.29 is ruled out.
9. In all these appeals, the lower authorities had not obtained Chemical Examiner’s report to determine the nature of the goods for the purpose of classification. The Bench had to direct the authorities to draw samples and obtain the Chemical Examiner’s report, which has now settled the controversy in favour of appellants. Hence, all the appeals are allowed with consequential reliefs, if any.