1. The Revision Application dated 22-7-80 against order-in-Appeal No.C3/2513/1978 dated 23-2-80, passed by the Appellate Collector of Customs, Madras, has been transferred by the Govt. of India to the Tribunal for disposal in terms of Sec. 131B(2) of the Customs Act, 1962.
2. The appellants are an industrial concern manufacturing dry cell batteries. They imported 651 packages of carbon rods, which were cleared under B/E 'NO. C. 300 dated 6-9-78 on assessment to duty under item 85 18/27(6). Subsequently, a notice was issued by the Customs authorities u/s 28(1) stating that an amount of Rs. 11,803.50 was short-levied since the goods were correctly assessable under sub-item (1) of item 85.18/27. The Assistant Collector of Customs did not accept the contentions of the Appellants and held that the battery is technically an electrolyser and the carbon electrodes should be assessed under sub-heading (1), since item 85.18/27(6) is only for electrodes used in furnaces, and he confirmed the demand. The Appellate Collector also did not accept the appellants' plea that the batteries are doing the same function as electrolysers and held that batteries and electrolysers are two different articles. Sub-heading (6) covers carbon electrodes for (1) furnaces and (2) electrolysers and not carbon electrodes for dry batteries. He rejected the appeal.
3. In the present appeal it is stated that the carbon rods become part of the battery only when they are embedded in manganese dioxide and a cap is fitted and hence they do not qualify, in the condition in which they are imported, for assessment as battery carbons under sub-item (1) of heading 85.18/27. As the battery employs the principle of electrolysis in utilising the carbon rod to light the bulb in the course of transit of the current, it is technically an electrolyser and sub-item (6) would be more appropriate for the carbon rods then sub-item (1), which covers battery corbons as the rods have also to be processed further. On these grounds, they plead for setting aside the impugned order.
4. A notice dated 12-5-83 was sent to the Appellants regarding the hearing on 6-7-83, when the case was called to-day, a telegram was fled stating that they have nothing further to add to the appeal and it may be adjudicated without personal hearing.
5. For the Department Shri Ajwani cited Jackson's Dictionery of Electrical Engineering to show that electrolysis in the de-composition of electrolyte by the passage through it of a direct current and an electrolyte is usually either a liquid...or a substance which is first dissolved in a suitable solvent usually water Battery carbons, according to the Explanatory Notes for heading 85.24 may be in the form of rods, plates, tubes etc., while carbon electrodes for electrolysis are in the form of plates, bars cylinders etc. and are designed to be mounted or suspended in electrolysis baths. He wanted the appeal to be rejected.
6. The short point for decision is whether the dry cell batteries in which the carbon rods are used can be described as electrolysers.
Heading 85.18/27(6) covers carbon electrodes for (1) furnaces and (2) electrolysers. Just as the former is a structure in which great heat is produced the latter connotes an apparatus where decomposition by an electric current is carried out. There is no material or evidence showing that in trade circles Dry Cell Batteries are treated as or called electrolysers. The appellants have also not called the dry cells electrolysers but only stated that they work on the principle of electrolysis; they also contend that the carbon rods do not become part of the battery i.e., electrodes, till they are processed embedded in manganese dioxide and cap is fitted. Keeping in mind the Explanatory Notes in the BTN given to 'Carbon electrodes for electrolysis and battery carbons' under heading 85.24 (which is merged in CTA Heading 85.18/27) we accept the department's contention that the subject goods are correctly classifiable as battery carbons covered by Heading 85.18/27(1) of the CTA. In the circumstances, the order appealed against is confirmed and the appeal is disallowed.