Tariff classification of asbestos gaskets turned on direct manufacture language, placing the goods under the residuary entry.

Non-automotive gaskets made from duty-paid asbestos gasketing sheets were treated as a new manufacture, but the tariff question turned on whether Item 22F(iv) of the Central Excise Tariff covered a further product made from an already manufactured intermediate article. The phrase "manufactures therefrom" was construed to mean direct manufacture from mineral fibre or yarn, not from goods previously made out of those materials. Because the gaskets were produced from asbestos sheets and not directly from fibre or yarn, Item 22F(iv) did not apply. As the goods were not otherwise specifically covered, they fell under the residuary Item 68, and the Revenue's classification claim failed.

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Issues: Whether non-automotive gaskets made from duty-paid asbestos gasketing sheets were classifiable under Item 22F(iv) of the First Schedule to the Central Excises and Salt Act, 1944 or under Item 68.

Analysis: The conversion of asbestos sheets into gaskets was accepted as manufacture, but the decisive question was whether Item 22F(iv), which covers mineral fibres and yarn and manufactures therefrom, extended to a further product made from an earlier manufactured article. The expression "manufactures therefrom" was construed to mean direct manufacture from fibre or yarn, not manufacture from goods already manufactured out of fibre or yarn. Since the gaskets were made from asbestos sheets and not directly from fibre or yarn, they did not fall within Item 22F(iv). As non-automotive gaskets were not otherwise specifically provided for in the tariff, they were classifiable under Item 68.

Conclusion: The classification under Item 68 was correct and the Revenue's contention that the goods fell under Item 22F(iv) was rejected.

Final Conclusion: The assessee succeeded on classification and the Revenue's appeal failed.

Ratio Decidendi: Where a tariff entry covers manufactures therefrom of a raw material, it applies to direct manufacture from that material and does not extend to a further manufactured product made from an intermediate article unless the tariff language so provides.

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