TaxTMI 
TaxTMI 
2024 (3) TMI 1515
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.... an advance ruling has been sought on applicability of serial number 545 of Notification No. 50/2017-Customs dated 30.06.2017. 2. The applicant has inter-alia stated that, they are a technical support service provider for defence projects and currently serves overseas clients in the area of an IT system based Business Process Management (BPM) for aircraft engines parts from Bengaluru and Maintenance, Repair & Overhaul ('MRO') services for aircraft engines from Kanpur; Indian Air Force ('IAF') through Ministry of Defence ('MoD') has provided a consent letter to the OEM that the applicant is eligible for provision of MRO services; they are authorized to conduct Maintenance, Repair & Overhaul (MRO) for SAE's M53 and M88 turbojet engines used for the Military Aircraft of the IAF; for provision of MRO services towards the aircraft's engine, the applicant ought to import certain parts of the engine from the OEM; the OEM supplies such parts to the applicant with a condition that they are not authorized to use these parts for any purpose other than Mirage Aircraft of the IAF or re-export them to any other country; further, the OEM also confirms that these....
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....Parts of Parts" ought to be deemed to be part of the machine; hence, in the instant case, engine being "part of aircraft" and subject goods being "parts of engine" ought to be considered as part of the aircraft and ought to be eligible for exemption. 4. The applicant has placed reliance on a number of cases, namely: (i) In the case of CCE, Nagpur v. Hyundai Unitech Electrical Transmission Ltd., wherein the Hon'ble Supreme Court, while allowing the benefit of Notification No. 6/2002-CE, to doors of tower which were used as part of Windmill (parts of parts of Windmill), held that, "It is not in dispute that as far as windmill doors or tower doors are concerned, it is a safety device which is used as security for high voltage equipment fitted inside the tower, preventing unauthorized access and preventing entries of reptiles, insects, etc., inside the tower. This, according to us, would be sufficient to make it part of the electricity generator. Further, since the tower is held as part of the generator, door thereof has to be necessarily a part of the generator. We, therefore, are of the opinion that there is no case of interference made out by the department, benefit ....
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.... Mumbai, held that, "The admitted position is M.S. Flanges are parts of Wind Mill Tower, which in turn is part of a WOEG [Wind Operational Electric Generator] following Tribunals decision in case of C.C.E. v. Techno Fab Manufacturing Ltd. - 2003 (158) E.L.T. 515 has held tower to be a part of the Wind Mill. Once tower is accepted and found and held to be part of WOEG, it is to be held that part i.e. flange of this part i.e. tower will be part of the whole i.e. Wind Generated Mill producing electricity from unconventional services. Every devices/systems part in this case having been specifically designed for that purpose in mind. That part of part is part of whole is well settled, relying upon [CCE v. Mahendra Engineering Works - 1993 (67) E.L.T. 134 followed in Bensel Industrial Corporation - 2000 (118) E.L.T. 119]. We find the 'flanges' to be a part of WOEG". (ix) In the case of Collector of C. Ex., Calcutta v. Jay Engineering Works Ltd., the Hon'ble Tribunal Delhi, held that, "Electrical Stampings and Laminations used in the manufacture of electric motors, which in turn are used in the manufacture of power-driven submersible pumps, are eligible for the benefi....
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....uty. Tariff item 8802 contains "Other aircrafts (For example, Helicopters, Aero planes), Spacecrafts (including Satellites) and suborbital and Spacecrafts Launch Vehicles. Applicant proposes to import seats of aircrafts, which is part of aircraft. Aircraft falls under Tariff item 8802 and its seats, which is also part of aircraft. It is to be noted that if the intention of the Govt. was not to extend benefit of said notification to seats of aircraft, it would have mentioned so in the notification, along with rubber tubes, to which this benefit is not extended. To our mind, the approach of Revenue to apply General Rules for Interpretation for Import Tariff, even for interpretation of notification in this case, is legally incorrect". 6. A personal hearing in the matter was conducted on 06.03.2024. During the personal hearing, the authorized representative of the applicant briefly explained the functioning of the company and submitted that the company is engaged in the business of maintenance, repair and overhaul services of Miraj aircraft engine. He further submitted that the company had already made an import of a consignment of spare parts of the aircraft to be used in maintenan....
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....hence, in the instant case, engine being "part of aircraft" and subject goods being "parts of engine" ought to be considered as part of the aircraft and ought to be eligible for exemption unless specifically restricted. Further, the exemption notification is to be read strictly and interpreted in terms of its language; when language is plain and clear, effect must be given to it; plain reading of the notification shows that all parts (other than rubber tyres and tubes) of aircraft of Heading 8802 or 8806 are eligible for exemption over and above 2.5% of BCD; it appears that the legislative authorities were conscious of the fact that the goods they are listing for exemption fell under different Headings or Chapters of the Customs Tariff and by not writing the Chapter heading into the notification, the exemption become possible for all kinds of parts of aircraft. Moreover under column (2) of the table against serial number 545, it is clearly stated that exemption is extended to goods mentioned in column number (3), falling under 'Any Chapter'; per the above, parts of engine, which in turn are parts of aircraft, ought to be eligible for exemption under serial number 545 of Not....