Tariff classification of rubber rollers: vulcanised rubber used in machinery stayed under Chapter 40 despite later exemption notification.

Rice milling rubber rollers and paddy dehusking rubber rollers were treated as articles of vulcanised rubber used in machinery, so Section Note 1(a) to Section XVI directed their exclusion from Chapter 84 and classification under CTH 40169990. The earlier Supreme Court ruling on rice rubber rolls was treated as controlling, while the later Tribunal view was distinguished as sub silentio and factually different. A subsequent exemption notification did not alter the settled tariff position, and the change to eight-digit tariff classification had no effect on the section note. The classification claim under CTH 84379020 therefore failed, leaving the dispute resolved in favour of Revenue.

---

---

Issues: Whether rice milling rubber rollers and paddy dehusking rubber rollers are classifiable under CTH 40169990 or CTH 84379020, and whether the exemption notification alters that classification.

Analysis: The goods were held to be articles of vulcanised rubber used in machinery, attracting the exclusion in Section Note 1(a) of Section XVI of the Customs Tariff Act, 1975. The earlier Supreme Court ruling on rice rubber rolls was treated as controlling, and the later Tribunal decision relied on by the assessee was distinguished as sub silentio and factually different. The exemption notification issued later was held not to displace the settled classification, and the switchover to eight-digit tariff classification was found to have no effect on the operation of the section note.

Conclusion: The goods were held classifiable under CTH 40169990 and not under CTH 84379020, in favour of Revenue.

Final Conclusion: The Revenue appeals succeeded and the assessee's classification claim failed, leaving the confiscation/classification dispute resolved against the assessee.

Ratio Decidendi: Goods of vulcanised rubber that are used in machinery remain excluded from Chapter 84 where the section notes expressly direct them to Chapter 40, and a later exemption notification does not alter that tariff classification.

---