ORDER
S.L. Peeran, Member (J)
1. This appeal arises from order-in-appeal No. 32/92, dated 25-9-1992 by which the Commissioner (Appeals), Madras has held that the item “Piling Rigs” are classifiable under chapter subheading 8431.00, attracting duty at 20% adv. as against a revised claim under chapter sub-heading 7308.90. The two rival sub-headings are as follows:
73.08 Structures (excluding prefabricated buildings of Heading No.
94.06) and parts of structures (for example, bridges, and
bridge-sections, lock-gates, towers, lattice masts, roofs,
roofing frameworks, doors and windows and their frames and
thresholds for doors, shutters, balustrades, pillars and columns),
of iron or steel; plates, rods, angles, shapes, sections, tubes and
the like, prepared for use in structures, of iron or steel.
7308.90 Others
84.31 Parts suitable for use solely or principally with the machinery of
Heading Nos. 84.25 to 84.30
2. The Commissioner (Appeals) took this view in terms of a Review application filed by the Commissioner seeking review of the order of the Asstt. Commissioner accepting the plea of the party for classification under subheading 7308.90 although the Asstt. Collector by his SCN dated 25-10-1990 had proposed to classify the item in question under chapter sub-heading 8431.00. There was no demand for differential duty as there was no clearance of the impugned product during the past 6 months. The Collector has noted that Piling Rigs are in the nature of support for the Pile Driver. They are designed to be used solely or principally with the particular kind of machinery viz. Pile Driver. She also noted that the drawing also supports this view. It has further been held that as per Explanatory notes at page 1207 of HSN, ‘supports’ are defined as parts of conveyors. On the same analogy, piling rigs, which are in the nature of support will have to be treated as part of the pile driver and classifiable under Heading 8431.00. She rejected the argument that Piling Rigs is not specifically mentioned as the list can at best be illustrative. Piling Drivers are specifically mentioned under Heading 84.30. So the piling rigs as parts thereof would fall under 84.31. She has also noted that the party had themselves sought classification originally under Heading 84.30. It was the lower authority in the Order-in-original who reclassified the item under 73.08 as structurals. The Commissioner also discussed about the applicability of the provisions of Section 11A for confirming the demand upto the limit of 6 months, if any, which arises as consequences of review application of the Commissioner being accepted.
3. Arguing for the appellants, the ld. Advocate Shri Arvind P. Datar submits that the goods are in the nature of structurals and they are used as supports. He argued that they are not parts of main machinery and therefore cannot be classified as parts suitable for use solely or principally with the machinery of Heading Nos. 84.25 to 84.30. He submits that it is in the nature of technical scaffolding and it is used for laying foundation of multi-storey buildings. It merely supports pile drivers as a structural and not as an excludable part.
4. On the other hand, ld. DR Shri Ravinder Saroop submitted that the item is part of pile driver and it has been rightly classified as parts solely or principally used along with the main machine. He submitted that the machine has a moving and static parts. He argued that the piling driver cannot function without the item in question and they work inconjectionally. He referred to pages 1129,1137,1207 of the Explanatory Notes. He supports the argument of the exclusion of the item from chapter heading 73.08 and found exclusion under Chapter Heading 84.31 as parts exclusively used along with the main machine. He also referred to HSN notes appearing at page 1131. Both sides referred to technical literature produced during the time of hearing. Ld. DR specifically referred to the definition of ‘machine’ as appearing in the book “Theory of Machines” by P.L. Ballaney.
5. On a careful consideration of the submissions made by both the sides, in the first instances, we have to see the claim of the party for classification of the goods under chapter heading 73.08 which description has already been noted above. As can be seen from the said description, the items that are required to be included are ‘structures and parts of structures. The parts of structures have also been illustrated. The other items are plates, rods, angles, shapes, sections etc., which are used in structures of iron and steel. Description of goods under Heading 73.08 indicates that they are in the nature of structures and parts thereof and does not refer to any particular item which is used as part solely or exclusively along with the machine. The definition of ‘machine’ as defined in the book THEORY OF MACHINES by P.L. Ballaney is noted here below:
1.1 Machine. A machine, according to one of the definitions given in Oxford English Dictionary, is “an apparatus for applying mechanical power, consisting of a number of inter-related parts, each having a definite function”, and this is the sense in which the word ‘machine’ is used here. It is very broad based definition and includes the concept of mechanical advantage as the sole object of a machine. A machine will be found to consist of an assembly of links or pieces. If motion is imparted suitably to one, all may receive motion, but their relationship will depend upon the nature of connections. If a force is applied suitably to one, a force may be obtained suitably from the other, but the relationships of the forces will depend upon the nature of connections.
Example. A beginner may be inclined to include petrol engine within the definition of a machine. Though, he is not far out in his thinking, a word of caution may be necessary. If it is confined to only this aspect that mechanical work, i.e. (Force x Displacement) is applied at the piston to obtain mechanical work at the crank shaft, i.e. (Torque x Angular displacement), in this case, the petrol engine can be called a machine. But the thermodynamics of combustion and all allied phenomenon compel us to call it an engine (Heat Engine). But machine tool in the workshop like lathe, shaper, planer etc. are machines. These satisfy both the definitions of mechanical advantage as sole object of machine and an apparatus for applying mechanical power.
As per the above definition, it is an apparatus for applying mechanical power, consisting of number of inter-related parts, each having a definite function. In this particular case, we have to see as to whether the item in question can be considered as having function related with the pile driver and whether the pile driver can function independently with the item namely Pile Rigs. As can be seen from the photographs, the pile driver is in the nature of Alphabet ‘H’ which moves in between the pile rigs.
6. The technical literature pertaining to Driving Rigs extracted from the book “Foundation Engineering” by C.A. LEONARDS describes about the Drop Hammers and Driving Rigs at pages 751 and 752 which indicates that a rig comprises a framework and platforms, to support the engine and boiler, and winches, to lift the pile and hammer. Standard and special rigs are made by pile-hammer manufacturers, as shown in their catalogues. Very heavy rigs for handling exceptionally long piles and heavy hammers are built to suit special conditions on large projects. Swiveling drivers, or turnatable rigs, are useful and efficient where large numbers of piles are driven in a small area. Batter-leader drivers and pendulum rigs drive piles at an angle. Pendulum rigs may be mounted on barges, cars, trucks, or skid rigs, and will also drive vertical piles. Locomotive, caterpillar, and whirly cranes are used for pile driving when equipped with a boom for handling leads and hammer. Railway pile drivers have drop or steam hammers mounted on special flatears, with leads which will fold inside railway clearances.
7. The description of Hammers appearing at page 751 of the said book is noted herein below :
7-54. Hammers
Drop Hammers. The weight is raised by cable run over the top of the frameworld and extending back to a drum or geared shaft. The ram is released by tripping for a free drop or by releasing the drum to allow the cable to unwind. The drag of the cable and drum reduces efficiency.
Single-acting Hammers. Steam of air raises the ram, which then drops by gravity. Hammers of this type are always used in leads. The ram has a low striking velocity and a heavy striking weight. The blows are much more rapidly delivered than for a drop hammer.
Double-acting Hammers. These employ steam or air to raise the ram and impart additional energy during the down stroke. They run at greater speeds than do single-acting hammers.
Differential-acting Hammers. These also employ steam or air to raise the ram and impart additional energy during the downstroke. They are obtainable in either open or closed type and run at greater speeds than do single-acting hammers.
Diesel Hammers. These have been used to a considerable extent in Europe. Types have been developed in the United States, and hammers have been imported. The hammers form in sell-contained unit, including fuel tank and injectors, and are lighter and more portable than steam hammers. Diesels operate more slowly than double-acting hammers. The harder the driving, the longer the stroke, which causes difficulty in rating energy and in operating when driving is soft. Energy determination is difficult. McKiernan-Terry rate their diesels by multiplying the weight of ram by stroke observed on a height scale on the hammer. Delmag computes energy of fuel injected and claims that energy is independent of stroke as long as fuel injected is constant from a setting of the fuel value; and Link-Belt uses a complex method, which is academic, because the operator can vary the amount of fuel with each stroke. For a fuller discussion of types and merit, Ref. 125 may be consulted.
8. The write-up on Piling Rigs filed by the appellants which is filed at page 17 of the Paper Book is as follows :
WRITE UP ON PILING RIGS
1. The piling system consists of the following:
(a) Main supporting Structure & Pulley Assemblies, –
also called Piling Rigs.
(b) Hoisting Winches & Pile Hammer, –
together called as Pile Driver.
2. The main supporting structure will be made out of steel channels, beam sections and plates. This will look like “A” frame. This structure has a base frame on which hoisting winches are mounted. Pulley assemblies are fixed on the top and bottom of the “A” frame of suitable size. One end of the wire rope is anchored to the winch rope drum and wire rope is reeved through the pulleys and other end is connected to the heavy hammer. The hammer is lifted to the required height by hoisting winches and allowed to drop as free fall on the pulleys with impact force. This force causes to drive the pile inside the ground.
3. Thus piling rigs act as supporting structure for Pile Driver.
9. On a reading of the entire technical literature and the write-up, it is very clear that Piling Rig is not a structure in the sense in which structures are described in chapter 73.08. It is used as parts of pile driver and pile driver cannot function unless this pile rig is installed. Pile Rig acts as a huge support column and the pile driver is made to work on the basis of wire ropes which are anchored to the winch rope drum and wire rope is reeved through the pulleys and the other end is connected to the heavy hammer. The hammer is lifted to the required height by hoisting winches and allowed to drop as free fall on the pulleys with impact force. This force causes to drive the pile inside the ground. Thus pile rigs do not act as a mere support but they function as part of the pile driver and the pile driver cannot function unless the pile rigs are installed. The Trade and Technical literature do not describe anywhere that they are in the nature of structures to be classifiable under chapter Heading 73.08. By applying the principle of [ejiisdem] generis the item cannot be said to be akin to the description of items which are shown under chapter Heading 73.08. On reading the HSN explanatory notes at page 1020 also, it is clear that the item does not fit into any of the description of the explanatory notes and same does not support the party’s claim. The description under chapter Heading 73.08 at page 1020 of HSN covers complete or incomplete metal structures, as well as parts of structures. For the purpose of this heading, these structures are characterised by the fact that once they are put in position, they generally remain in that position. They are usually made up from bars, rods, tubes, angles, shapes, sections, plates, wide flates including so-called universal plates, hoop, strip, forgings or castings, by riveting, bolting, welding etc. Such structures sometimes incorporate products of other headings such as panels of woven wire or expanded metal of Heading 73.14. Parts of structures include clamps and other devices specially designed for assembling metal structural elements of round cross section (tubular or other). These devices usually have protuberances with tapped holes in which screws are inserted, at the time of assembly, to fix the clamps to the tubing. The Explanatory Note also illustrate number of items which come within this heading. On such a reading, it is clear that the present item does not figure in any of the description. At page 1021, Heading 73.08 illustrates the items which are not covered therein. At S. No. (c), “Constructions clearly identifiable as machinery parts (Section XVI) are excluded from chapter Heading 73.08”. As can be seen from the reading of the above notes, the structures are characterised by the fact that once they are put in position, they generally remain in that position. The structures become part of the immovable property and they are not movable as in the present case. The item pile rigs are merely ‘supports’ and kept on the floor and the pile driver moves in between the pile rigs and therefore it is a moving part and not a ‘structure characterised by the fact that they are once put up in position, they generally remain in that position. Therefore, the claim of the party for classification under chapter Heading 73.08 is required to be rejected.
10. As regards department’s claim for classification under Chapter Heading 84.31 it is seen that this heading refers to “parts suitable for use solely or principally with the machinery of Heading Nos. 84.25 to 84.30”. The description of the goods is not disputed by either sides that Pile Drivers are specifically included in Heading 84.30 and therefore its parts which are used solely and specifically are required to be classified under Heading 84.31. The Section Note 1 to Section XVI gives a list of items from description (a) to (n) which are excluded from the chapters under XVI. The present Item does not figure in any of the exclusion clause. Section Note 2 illustrates the manner in which the parts of machine are required to be classified. Section Note 2(a) states that parts which are goods included in any of the headings of chapter 84 or chapter 85 (other than Heading Nos. 84.85 and 85.48) are in all cases to be classified in their respective headings.
11. Section Note 2(b) states that other parts, if suitable for use solely or principally with a particular kind of machine, or with a number of machines of the same heading (including a machine of Heading No. 84.79 or Heading No. 85.43) are to be classified with the machines of that kind. In the present case as the pile drivers are specifically mentioned under Chapter 84.30 and the pile rigs being parts thereof and that pile driver cannot function without pile rigs therefore the classification adopted as parts suitable for use solely or principally along with the machinery of Heading Nos. 84.25 to 84.30 is sustainable. A reading of HSN at pages 1129,1130 and also at page 1136 under Chapter 84 supports the view taken by the Collector (Appeals).
12. It is seen that the item in question is not excluded from any of the categories discussed in these pages of HSN notes. At page 1021 also under Chapter Heading 73.08 at S.No. (c) deals with the items which are not covered under Chapter 73.08 and one such is “constructions clearly identifiable as machinery parts (Section XVI)”. Therefore in view of the detailed discussion and the reasonings given, we find there is no merit in the appeal and hence it is rejected.