Polymerised plastic goods and tariff classification: duty demand failed where later exemption could not sustain earlier clearances.

Acrylic plastic bangles and tubes made from methyl methacrylate monomer were treated as articles of plastic for tariff purposes because they were manufactured through polymerisation. Reliance on Notification No. 143/80-CE, through Rule 9A(5), was rejected as an independent basis to sustain duty on earlier clearances. The governing Gujarat High Court view was applied that a plastic bangle produced from a monomer undergoing polymerisation is not assessable under Item 15A in the manner urged by revenue. The review notice was set aside, and the duty demand did not survive.

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Issues: Whether acrylic plastic bangles and tubes manufactured from methyl methacrylate monomer were articles of plastic assessable under Item 15A of the Central Excise Tariff, and whether duty could be sustained by invoking Notification No. 143/80-CE and Rule 9A(5) of the Central Excise Rules.

Analysis: The goods were found to be manufactured through polymerisation of the monomer, and were therefore treated as articles made of plastic for tariff purposes. The attempted reliance on Notification No. 143/80-CE through Rule 9A(5) was not accepted as an independent basis for sustaining duty on goods cleared earlier. The decisive consideration was the Gujarat High Court ruling that a plastic bangle made from a monomer undergoing polymerisation during manufacture would not be an article of plastic assessable under Item 15A.

Conclusion: The review notice was set aside, and the assessee succeeded.

Final Conclusion: The duty demand and review action did not survive, and the exemption/classification dispute was resolved in favour of the assessee on the basis of the governing High Court view.

Ratio Decidendi: Where a product is manufactured from a monomer through polymerisation, its assessability under the plastic tariff entry must be determined in accordance with the governing judicial interpretation of that entry, and a later exemption notification cannot be used through a rate-determination rule to fasten duty on earlier clearances.

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