TaxTMI 
TaxTMI 
2018 (6) TMI 141
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....tion i.e. of DC Motor and of rear wheel. The issues involved are whether; (a) the DC motor imported classifiable under tariff item 8501 3119 as claimed by appellant or under tariff item 8714 1090, as held by Revenue. (b) Or, the benefit of exemption notification admissible to impugned goods under Notification No. 12/ 2012-Cus (Serial No. 439), Notification No. 21/2012-Cus (Serial No. 7), Notification No. 06/2006-CE (Serial No. 35A) or Notification No. 12/2012-CE (Serial No. 274, 296). 3. Ld. Counsel for the appellant submits that DC Motors for e-bike consist of two major parts i.e. stator and rotor. The stator is the stationery part of motor and rotor is the moving part of motor. The rotor is designed in such a manner so that circumference of rotor works as rear wheel of e-bike and is able to directly transmit its rotary motion on the road by just mounting tyre on its circumference. He further submits that the impugned goods are designed to minimize the consumption of battery energy and have no chain drive, no gear box and no transmission axle. In this way the weight of e-bike is drastically reduced which is the primary requirement of electric vehicle. This design is used ....
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....tors and generators (excluding generating sets) 8501 10 - Motors of an output not exceeding 37.5W - Other DC motors; DC generators; 8501 31 -- Of an output not exceeding 750W 8501 31 11 ---- Micro Motor 8501 31 12 ---- Stepper motor 8501 31 13 ---- Wiper motor 8501 31 19 ---- other Tariff Item Description of goods 8714 Parts and accessories of vehicles of heading 8711 to 8713 - Of motor cycle (including mopeds) 8714.10 - Of motor cycle (including mopeds) 8714 10 10 --- Saddles 8714 10 90 --- Others As per the said tariff, the electrical motors are classifiable under Chapter heading 8501 whereas parts and accessories of vehicles are classifiable are under tariff heading 8714. 6. The appellant is claiming exemption under Notification Nos. 12/2012- Cus (Serial No. 439), 21/2012-Cus (Serial No. 7) and 12/2012-CE (Serial No. 274, 296), 06/2006-CE (Serial No. 35A or 12/2012-CE (Serial No. 296), which reads as under:- Notification Nos. 12/2012-Cus (Serial No. 439) S.No. Chapter or Heading or Subheading or tariff item Description....
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....s of this entry, "electrically operated vehicles" means vehicles which are run solely on electrical energy derived from an external source or from one or more electrical batteries fitted to such road vehicles and shall include electric motor-assisted cycle rickshaws driven by rechargeable solar batteries, also known as 'soleckshaw' Nil 6% Nil 296 296 Any Chapter The following goods for use in the manufacture of goods specified against Serial No. 274, namely :- (i) Battery pack; (ii) Battery charger; (iii) AC or DC motor; and (iv) AC or DC motor controller 6% 2 Condition No. Conditions 2 Where such use is elsewhere than in the factory of production, the exemption shall be allowed if the procedure laid down in the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2001, is followed. As per the description of excisable goods, DC Motor is covered under the said notifications and exempted from payment of duty on following the procedure laid down in the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2001. Ad....
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....them their essential character, insofar as this criterion is applicable. (c) When goods cannot be classified by reference to (a) or (b), they shall be classified under the tariff heading which occurs last in numerical order among those which equally merit consideration. Further, Note 3 and 4 to Section XVI (for Chapter 84 & 85) and Note 2 and 3 of Section XVII (for Chapter 86 to 89) of Customs Tariff Act are also reproduced below for better appreciation of the matter:- Note 3. Section XVI (for Chapter 84 & 85) Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines adapted for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function. Note 4. Section XVI (for Chapter 84 & 85) Where a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function cove....