2000 (6) TMI 220 - AT - Central Excise

Tribunal classifies three-wheeler vehicles as autorickshaws under Central Excise Tariff Act

BAJAJ TEMPO LTD. Versus COLLECTOR OF C. EX., PUNE

BAJAJ TEMPO LTD. Versus COLLECTOR OF C. EX., PUNE - 2000 (120) E.L.T. 472 (Tribunal) Issues Involved:1. Classification of the three-wheeler motor vehicles and chassis manufactured by M/s. Bajaj Tempo Ltd.2. Eligibility for exemption under Notification No. 162/86-C.E., dated 1-3-1986.3. Application of definitions from the Motor Vehicles Act to the Central Excise Tariff Act.4. Interpretation of terms in commercial parlance versus statutory definitions.5. Applicability of Circular No. 93/9/95-CX, dated 17-1-1995.Detailed Analysis:1. Classification of the Three-Wheeler Motor Vehicles and Chassis:The primary issue is whether the three-wheeler motor vehicles and chassis manufactured by M/s. Bajaj Tempo Ltd. should be classified as 'Tempo, three-wheeler autorickshaw' under Sub-headings 8703.00 and 8706.30 of the Central Excise Tariff Act. The Assistant Collector initially approved this classification, allowing a concessional rate of duty. However, the Collector (Appeals) later disallowed the exemption, holding that the vehicles did not qualify as autorickshaws under the Motor Vehicles Act due to their seating capacity for six passengers (excluding the driver).2. Eligibility for Exemption under Notification No. 162/86-C.E., dated 1-3-1986:M/s. Bajaj Tempo Ltd. claimed concessional duty under Notification No. 162/86-C.E., which provides exemptions for certain vehicles, including autorickshaws. The Collector (Appeals) denied this exemption, interpreting the term 'autorickshaw' based on a specific notification (S.O. 436(E)) under the Motor Vehicles Act, which defines autorickshaw as a vehicle carrying not more than three passengers (excluding the driver).3. Application of Definitions from the Motor Vehicles Act to the Central Excise Tariff Act:The appellants argued that the definition of autorickshaw in S.O. 436(E) should not be used to interpret the term in the Central Excise context. They cited several judicial precedents, including the Supreme Court's decision in M.S.C.O. Pvt. Ltd. v. Union of India, which held that definitions in one statute should not be imported into another unless explicitly stated. The appellants emphasized that the term should be understood in its commercial and common parlance, not restricted by the Motor Vehicles Act's definition.4. Interpretation of Terms in Commercial Parlance versus Statutory Definitions:The appellants provided evidence, including affidavits from dealers, drivers, and associations, to demonstrate that in commercial parlance, their vehicles are recognized as autorickshaws. They argued that the Collector (Appeals) erred by not considering this commercial understanding and instead relying solely on the statutory definition from the Motor Vehicles Act. The Tribunal agreed, stating that the commercial understanding of the term should prevail in the context of the Central Excise Tariff.5. Applicability of Circular No. 93/9/95-CX, dated 17-1-1995:The appellants referred to Circular No. 93/9/95-CX, which clarified that three-wheeled vehicles, including those used for transporting goods, are eligible for the exemption under Notification No. 162/86-C.E. The Tribunal found this circular relevant and supportive of the appellants' claim, noting that the product in question is a three-wheeled motor vehicle classifiable under Heading 87.03 and its chassis under Sub-heading 8706.30.Conclusion:The Tribunal concluded that the product in question should not be denied the benefit of exemption under Notification No. 162/86-C.E. merely because it does not fit the definition of 'autorickshaw' in S.O. 436(E). The term should be understood in its commercial and common parlance, where the impugned product is recognized as an autorickshaw. Consequently, the appeal was allowed, and the impugned order was set aside.