Plastic goods classification under Chapter 39.26 secured exemption under the relevant notification for industrial tanks and gratings.

Plastic tanks, vessels, scrubbers and gratings used in chemical plants were classified under Chapter Heading 39.26 as plastic articles, because they were not shown to be builders' ware and their industrial character was determinative. The alternative tariff headings relied on by the department were rejected. Once the goods fell within Chapter 39.26, the conditions for Notification No. 132/86 dated 1-3-1986 were satisfied, so the exemption was available. The impugned order was modified and the appeals succeeded on both classification and exemption.

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Issues: (i) Whether tanks, vessels, scrubbers and gratings were classifiable under Chapter Heading 39.26 of the Central Excise Tariff Act, 1985; (ii) whether the appellants were entitled to the benefit of Notification No. 132/86 dated 1-3-1986.

Issue (i): Whether tanks, vessels, scrubbers and gratings were classifiable under Chapter Heading 39.26 of the Central Excise Tariff Act, 1985.

Analysis: The goods were examined as plastic articles used in chemical plants. Tanks and vessels were found not to be builders' ware and no evidence showed sale to builders or use as building material. Scrubbers were treated as plastic shell tanks used in the same industrial context, and gratings were treated as plastic articles fitting within Chapter 39. The classification therefore followed the specific plastic tariff entry rather than the alternative headings suggested by the department.

Conclusion: Tanks, vessels, scrubbers and gratings were held classifiable under Chapter Heading 39.26 of the Central Excise Tariff Act, 1985.

Issue (ii): Whether the appellants were entitled to the benefit of Notification No. 132/86 dated 1-3-1986.

Analysis: Once the goods were held to fall under Chapter Heading 39.26, they answered the conditions for the exemption claimed under Notification No. 132/86 dated 1-3-1986. The earlier denial of exemption was therefore unsustainable to that extent.

Conclusion: The benefit of Notification No. 132/86 dated 1-3-1986 was available to the appellants.

Final Conclusion: The impugned order was modified and the appeals succeeded on classification and exemption for the disputed goods.

Ratio Decidendi: For plastic goods used in industry, classification must be determined by the specific tariff entry applicable to the goods as manufactured and cleared, and not by their later use or by an unsupported assumption that they are builders' ware; exemption follows once the correct classification is established.

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