1998 (9) TMI 257 - AT - Customs

Tribunal Upholds Collector's Classification of Gas Compressors

COMMISSIONER OF CUSTOMS Versus RELIANCE INDUSTRIES LTD.

COMMISSIONER OF CUSTOMS Versus RELIANCE INDUSTRIES LTD. - 1999 (107) E.L.T. 494 (Tribunal) Issues:1. Classification of imported goods as centrifugal gas compressors or air compressors.2. Interpretation of relevant entries in Appendix 1 Part B and Appendix 3 of the Import Policy 1988-91.3. Application of Para 21(c) and (f) in determining eligibility for import under Open General Licence (OGL) for gas compressors.Analysis:1. The case involved a dispute regarding the classification of imported goods as centrifugal gas compressors or air compressors. The Collector framed three questions for consideration: the nature of the goods, their classification under specific entries in the Import Policy, and the relevance of their import as capital goods under Appendix 3 Part A.2. The importer argued that air compressors should be considered gas compressors under Entry 20(2) of Appendix 1 Part B, citing the composition of air as primarily nitrogen and oxygen. The Chief Controller initially opined that compressors for air compression were not covered, but later, based on technical capabilities, considered them as gas compressors. The Collector concluded that air compressors could be classified as gas compressors under Entry 20(2).3. The appeal challenged the Collector's decision, arguing that Para 21(c) and (f) prohibited import under Appendix 1 due to specific entries in Appendix 3. However, it was reasoned that gas compressors were explicitly permitted under Appendix 1, distinct from the broader category in Appendix 3, supporting import eligibility under Appendix 1. The Collector's interpretation, supported by policy distinctions and expert clarifications, was deemed valid.4. Additionally, the Collector's determination that the goods were capital goods for manufacturing purposes, not raw materials, aligned with policy definitions and expert opinions. The argument that conflicting expert views should benefit the importer was rejected, upholding the Collector's decision based on the available evidence.5. Ultimately, the Tribunal dismissed the appeals, affirming the Collector's classification of the goods as eligible under Entry 20(2) of Appendix 1 Part B. The judgment emphasized the technical capabilities of the compressors, policy distinctions between appendices, and the classification of goods as capital items for manufacturing, supporting the Collector's decision and denying any grounds for interference.