ORDER
H.R. Syiem, Member (T)
1. M/s. Voltas Ltd. imported components for electrostatic precipitators under bill of entry No. 2073, dated 17-2-1978 and bill of entry No. 2073D, dated 17/18-2-1978 and they claimed assessment of these goods under 84.17(1) as part of power plant equipments, but the Custom House assessed them under 84.18(2). They accordingly filed refund claims which were rejected by the Assistant Collector of Customs (Refund Department), Bombay, vide his order No. S/4-B-18/79R, dated 19-3-1979 and order No. S/4-B-238/78R, dated 23-2-1979, who held that the electrostatic precipitators were covered under 84.18 in view of the Explanatory Note in the BTN. The Appellate Collector of Customs, Bombay, agreed in his order Nos. S/49-665/79R and 666/79R, dated 7-8-1979 with the Assistant Collector that the electrostatic precipitators should be assessed under 84.18(2) as the filter air/gas.
2. The learned Counsel for the appellants, Mr. Haksar, said that an electrostatic precipitator is not an air filter, because, they do not filter the air. Air filters are designed to clean and purify the air before it is used in a process. The electrostatic precipitators do not do so, but merely remove harmful particles like fly ash dust from the gas emitted by power station flue. These particles not only damage power station machinery but also pollute the air into which they are released. The electrostatic precipitators catch and draw these particles, removing from the gas before it is released into the sorrounding air.
3. The learned Counsel, therefore, said the only heading under which they can fall is 84.17 or 84.01/02.
4. The learned Counsel for the department, however, said that 84.01/02 is for steam and other vapour generating boilers and auxiliary plants for use with such boiler. The electrostatic precipitator is not an auxiliary plant for use with such boiler. It is merely a component for a limited purpose. Heading 87.17 covers machinery, plant and similar laboratory equipments for the treatment of materials by a process involving a change of temperature. In the power generating plant in which the electrostatic precipitators are to be used, there is no treatment of material by process involving a change of temperature but is only to heat the water to produce steam to turn the turbines.
5. However, heading 84.18 is specific for electrostatic precipitators and this is also supported by the Explanatory Notes in the BTN.
6. The SDR is correct to say that the CCCN specifies electrostatic air and gas filters of the kind under scrutiny as falling under 84.18. However, the CCCN based Customs Tariff of 1975 divided the heading into two sub-headings, thus :
Centrifuges; filtering and purifying machinery and apparatus [other than filter fuels (the words should be funnel), milk strainers and the like], for liquids or gases:
(1) Not elsewhere specified
(2) Air filters; oil or fuel filters for internal combustion piston engines.
7. The Custom House assessed the imported precipitators under Sub-head. (2); this is not the correct head for them, because air filters are meant to filter the air to be supplied into a machine or a system which requires purified, uncontaminated and particle – free air for use. The CCCN also provides sufficient indication that air filters under this heading are air filters of the kind used in petrol and diesel engines which always use filtered air for supply into the combustion chambers. The Indian tariff lists air filters with oil and fuel filters for internal combustion piston engines in Sub-head. (2). This is a clear clue that the air filter that the sub-head, holds is of the kind used in internal combustion engines. There can be no doubt that the assessment under 87.18(2) of these goods was wrong.
8. Unfortunately, the importers have asked for assessment under 84.01/02 or 84.17. Neither of these heads will cover these precipitators. I believe the importers seek 84.01/02 because it lists, among other things, soot removers, gas recoverers and the like. The electrostatic precipitators are not in this class. A soot remover removes soot from flues and chimneys to clear the passage for gas, smoke etc.; and gas recoverers are designed to recover gas for recycling for use and generally for reutilisation. These goods will not fit into 84.01/02 and, in fact, they are not auxiliary plant for use with boilers because they do not in any way add or enhance the function of the boilers.
9. 84.17 covers machinery and plant for the treatment of materials by a process involving a change of temperature. The Collector of Customs (Appeals) has correctly said that these precipitators cannot be considered to be equipment for the treatment of materials involving a change of temperature. The water boiled in the boiler is not material to be treated but merely means achieving of production of steam. Treatment of material applies a modification of that material so that it is put to some other use.
10. However one might regard headings 84.01/02 and 84.17, there is specific and explicit coverage for electrostatic precipitators in 84.18 and this head being more specific and precise than the two other heads must receive first preference. The other heads asked for by the importers are less preferrable and, in fact, they would not cover electrostatic precipitators for reasons that have already been reported. Accordingly, the assessment asked for by the importers would not be in order.
11. In these circumstances, the action of the Assistant Collector and the Appellate Collector must remain unchanged.