ORDER
Jyoti Balasundaram, Member (J)
1. The classification of water well drilling rigs manufactured by the appellants is the issue for consideration in this appeal – according to the Department the item merits classification under Heading 8705.00 which covers “special purpose motor vehicles other than those principally designed for the transport of persons or goods”, while the appellants claim classification under Heading 84.30 which covers
“other moving, grading, levelling, scrapping, excavating…extracting or boring machinery for earth, minerals or ores ..”.
2. The appellants are engaged in the manufacture of 6 models of water well drilling rigs known as :
1. SP 6 D. Drill pack
2. SP 6 D. Inwell Drill pack
3. SP 6 Super D. Drill pack
4. SP 6 LRD Drill pack
5. SP 6 Super LRD Drill pack
6. Sparr SMLRD
All these models are identical in terms of manufacturing process and only vary in terms of capacity and size. A hydraulic power pack provides hydraulic power to all the drilling and control functions. The mounting of the compressor and the drill pack could be done either on the skid or the truck chassis or the trailer or the crawler depending upon the need of the customer. In the present case the mounting was done on truck chassis purchased from outside by altering the gear box of chassis engine so that during the time of drilling, the chassis engine acts as the prime mover of the hydraulic system, certain structural changes are carried out in the gear box of the chassis either by cutting the main propeller shaft and incorporating a transfer gear box or by fixing an extra gear box in the gear box to draw power and connect it to another power take off unit, the chassis gets integrated with the drilling rigs.
3. The appellants have filed a miscellaneous application stating that the issue is covered by the order of the Tribunal in the case .of LMP Precision Engineering Co. Ltd. v. CCE, Baroda reported in 1994 (70) E.L.T. 580 (Tri.) upholding the classification of the item in dispute under Heading 84.30 of the CETA, 1985 and seeking a decision on the merits of the matter.
4. We have gone through the same and heard the learned DR, Shri S.K. Sharma who fairly concedes that the issue is covered by the order (supra). We agree that the issue is squarely covered by the order (supra). Paragraph 5 of the order is reproduced below :
“We have carefully considered the pleas advanced on both sides. We observe that the adjudicating authority has relied only on the following portion of HSN Explanatory Notes under Chapter Heading 84.30:
“(C) Explanatory note of Chapter Heading 84.30(2) Machines mounted on automobile chassis or lorries. Certain machines of this heading (e.g. pile-drivers, oil well drilling machines are often mounted on what is in fact an essentially complete automobile chassis or lorry in that it comprises of least the following mechanical features: propelling engine, gear box and controls for gear changing and steering and breaking facilities. Such assemblies are classified in Heading 87.05 as special purpose motor vehicles.”
and has not taken into consideration the complete Explanatory Notes both under Chapter Headings 87.05 and 84.30 which have already been set out above. Manufacturing process, as pointed out by the learned Advocate, has been fully set out in the impugned order at page 27 thereof. This process of manufacture has not been rebutted, as rightly pointed out by the learned advocate. Manufacture of specific power-take off device by the appellants has also not been denied by the adjudicating authority. In the aforesaid facts and circumstances, we agree with the learned advocate for the appellants that the motor vehicle chassis on which the drilling rig is mounted are so integrated that the chassis cannot be separately used as a motor vehicle. Therefore, we hold that the goods are correctly classifiable under Chapter Heading 84.30. Classification under Chapter Heading 87.05, as made by the adjudicating authority is not correct.”
Hence, following the ratio of the above order, we hold that the goods are classifiable under Heading 84.30, set aside the impugned order and allow the [appeal] if any to the appellants.
(Operative part of the order announced in open court).