Machinery classification prevails where imported blades function as essential machine parts rather than independently usable tools.

Bevel gear cutting blades that are fitted into machinery and are not independently usable as general-purpose tools were classified under Heading 98.06 as machinery parts rather than under Chapter 82 as tools. The tribunal applied the principle that the essential character and functional use of the imported item govern classification, and a later notification was treated only as supporting that approach. On that basis, the goods were assessable under Heading 98.06 at the appropriate rate, the assessee's classification claim failed, and the Revenue's appeal succeeded.

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Issues: Whether bevel gear cutting tools (blades) were classifiable under Heading 98.06 as parts of machinery or under Chapter 82 as tools.

Analysis: The imported goods were blades required to be fitted into machines and were not independently usable as cutting tools. The Tribunal applied the earlier reasoning that items which function as essential parts of machinery, and are not general-purpose tools, fall within Heading 98.06 despite their description under a more specific tools heading. The later notification relied upon by the Revenue was treated as supporting the classification principle but the decisive factor remained the nature of the goods as machine parts.

Conclusion: The goods were classifiable under Heading 98.06 and assessable at the appropriate rate, not under Chapter 82.

Final Conclusion: The assessee's classification claim failed and the Revenue's appeal succeeded, with the lower order being set aside.

Ratio Decidendi: An item that is an essential part of machinery and is not independently usable as a general tool is classifiable under the machinery heading, even if it may otherwise resemble a tool under a more specific chapter heading.

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