Independent par-boiling and drying plants classified under Heading 8419, not as part of a composite rice-milling machine.

Where par-boiling and drying equipment function independently rather than as part of a composite rice-milling machine, classification under Heading 8419 applies and not Heading 8437. The Board circular, read with Section Notes 3 and 4 of Section XVI and Chapter Note 2 of Chapter 84, supports Heading 8437 only when the machinery forms part of a rice-mill combination performing the principal rice-milling function. On the facts recorded by the Commissioner, the plants had separate functions and were not integral to a composite rice-milling machine, so the assessee's reliance on the circular and a prior concession-based decision failed. The classification under Heading 8419 was upheld.

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Issues: Whether the par-boiling plant and drier plant were classifiable under Heading 8419 as independent machinery or under Heading 8437 as part of a composite rice-milling machine.

Analysis: The Board circular relied upon by the parties applied the rule of classification for composite or multifunction machines under Section Notes 3 and 4 of Section XVI, read with Chapter Note 2 of Chapter 84, and indicated that where par-boiling machinery and drier plant form part of a rice-mill combination performing the principal function of rice milling, the correct classification would be under Heading 8437. On the facts of the present case, the detailed findings recorded by the Commissioner showed that the par-boiling and drying plants had independent functions and did not form part of a composite rice-milling machine. The circular did not cover a situation where each plant functioned independently. The prior decision cited by the assessee was rendered on a concession and did not lay down a binding principle.

Conclusion: The par-boiling plant and drier plant were correctly classified under Heading 8419. The challenge to the classification failed.

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