ORDER
Lajja Ram, Member (T)
1. In this appeal filed by the Revenue the only issue for our consideration is that whether the A.C. Servo Motors and A.C. Servo Controls imported by the respondents M/s. TICO Machines (P) Ltd., Hyderabad were eligible for the benefit of exemption Notification No. 181/87-Cus., dated 29-4-1987 (as amended) or not. The respondents had claimed that these motors and controls were not part of CNC system or components of such system and were covered by the description as given in the said Notification read with the final orders as classifiable as per the Table annexed to that Notification. The Assistant Collector of Customs had held that the imported items A.C. Servo Motors and A.C. Servo Controls were components of CNC system and were not covered by the Customs Notification No. 181/87. On appeal the Collector of Customs (Appeals), Madras had held that the goods in question were not parts of the CNC System.
2. In appeal the Revenue had contended that the imported components were used in CNC horizontal drill centre which is a CNC (Computerised Numerically Controlled) machine tool and as the Notification No. 181/87-Cus. excludes from its purview CNC systems and components of such system, CNC system for a machine tool has a wide area of coverage and it includes within its ambit servo controls or drives. It has been added that the items imported i.e. A.C. Servo Motors and Servo Controls constituted components of CNC system for use with the Horizontal drill centre and thus they were not covered under Customs Notification No. 181 / 87-Cus.
We have heard Shri K.K. Jha, SDR, for the appellants Revenue and Shri N.C. Sogani and Shri K. Kumar, Advocates for the respondents. We have gone through the facts and records of the case.
3. Under Notification No. 181 /87-Cus., dated 29-4-1987, parts required for the purpose of initial setting or for the assembly or manufacture of the specified article when imported into India and proved to the satisfaction of Assistant Collector of Customs to be so required for such setting up, assembly or manufacture were provided partial exemption from the customs duty subject to the fulfilment of the specified conditions. It was provided that nothing contained in that Notification was to apply in respect of CNC system and components of such systems.
4. We are not concerned with the fulfilment of the other conditions in the Notification and the only question before us is whether the A.C. Servo Motors and A.C. Servo Controls imported were parts of the CNC system or parts of the components of CNC system. The Ld. Advocate had submitted that the CNC system is different from the complete machine for which they imported these goods and that these goods were required for the horizontal drill centre TH 25 whose description as per their suppliers literature is as under :-
“The Machine is a simplified horizontal machining centre with ten tool Auto Tool Changer to perform a wide variety of operations like Drilling, Reaming, Spot Facing, Tapping, Light Milling etc. Due to its simplicity, it is a highly reliable production machine. No Hydraulics, No Pneumatics, simple Auto Tool Changer.”
5. It has further been explained that the exclusion is only of the CNC system and components of such systems and not to the parts of the machines, machines which are otherwise covered by the description as given in the Table annexed to that Notification, if the machines were otherwise covered by the said description. It was further submitted that the goods imported were not a part of the CNC system or the components of such a system.
6. We find that the Ld. Collector of Customs (Appeals) had distinguished the CNC system from the CNC version of the machine and had held that the goods imported were not part of the CNC system. We find that the Revenue has not produced any material to show that the imported motors and controls from part of the CNC system as such. To our mind simply because these motors and controls were parts of a machine which could be a conventional machine or could be a CNC controlled machine the benefit of Notification could not be denied unless there is a clear finding that they were part of the CNC system as such.
7. Taking all the relevant considerations into account we find no ground to disturb the findings of the Ld. Collector Customs (Appeals).
8. As a result the appeal filed by the Revenue is rejected.