Approved classification and engine parts classification governed: radiator assemblies fell under parts of internal combustion engines, not accessories.

A show cause notice challenging an earlier approved classification could not sustain the demand for the notice period, and that demand was quashed because the settled classification position remained operative until specifically challenged. Radiator assemblies were held to be parts of internal combustion engines, since a cooling device is integral to engine function; they could not be treated merely as accessories under Tariff Entry 84.79 when Tariff Entry 84.09 covered parts suitable for use solely or principally with such engines. The assessee therefore obtained only limited relief on the quashed notice, while the reclassification challenge failed.

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Issues: (i) Whether the demand raised by the show cause notice dated 16 July 1992 was liable to be quashed in view of the earlier approved classification and the binding effect of the settled position; (ii) whether radiator assemblies were classifiable as accessories of internal combustion engines under Tariff Entry 84.79 or as parts suitable for use solely or principally with such engines under Tariff Entry 84.09.

Issue (i): Whether the demand raised by the show cause notice dated 16 July 1992 was liable to be quashed in view of the earlier approved classification and the binding effect of the settled position.

Analysis: The demand for the period covered by the first show cause notice was held not to survive because the issue was governed by the principle applied in the earlier Constitution Bench ruling on approved classification lists. Once the correctness of an approved classification is challenged by a valid show cause notice, the levy based on that approval cannot be sustained for that notice period in the same manner as before.

Conclusion: The demand covered by the show cause notice dated 16 July 1992 was quashed.

Issue (ii): Whether radiator assemblies were classifiable as accessories of internal combustion engines under Tariff Entry 84.79 or as parts suitable for use solely or principally with such engines under Tariff Entry 84.09.

Analysis: The Court held that an internal combustion engine cannot function without a cooling device and that a water-based radiator serving that function is a part of the engine. On that reasoning, radiator assemblies could not be treated merely as accessories when the tariff entry for parts of engines squarely covered them.

Conclusion: Radiator assemblies were correctly classifiable as parts under Tariff Entry 84.09 and not as accessories under Tariff Entry 84.79.

Final Conclusion: The first demand was set aside, while the remaining challenges to reclassification failed, leaving the assessee with only limited relief on the notice that was specifically quashed.

Ratio Decidendi: A cooling device integral to the functioning of an internal combustion engine is a part of the engine for tariff classification purposes, and a classification based on a validly approved list continues only until its correctness is specifically challenged by show cause notice.

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