Textile belting classification and additional duty levy remained separate; exemption from excise did not defeat the statutory surcharge.

Nylon belting cloth cut to size and shape was classified under the textile tariff heading for transmission or conveyor belts, because Chapter Note 4(a)(ii) to Chapter 59 covered belting cloth and Note 1(c) to Section XVI excluded it from the machinery chapter; it was therefore not treated as a component part of machinery. An exemption from excise duty under a Central Excises notification did not bar levy of additional duty under the Additional Duties of Excise (Goods of Special Importance) Act, 1957, because that Act imposes a separate levy in addition to excise duty. The refund claim failed on both points.

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Issues: (i) Whether nylon belting cloth cut to size and shape could be treated as a component part of machinery and kept of the textile heading for purposes of countervailing duty. (ii) Whether exemption from duty under the notification issued under the Central Excises & Salt Act, 1944 prevented levy of additional duty under the Additional Duties of Excise (Goods of Special Importance) Act, 1957.

Issue (i): Whether nylon belting cloth cut to size and shape could be treated as a component part of machinery and kept of the textile heading for purposes of countervailing duty.

Analysis: The relevant tariff scheme specifically placed transmission, conveyor or elevator belts of textile material and similar articles used in machinery or plant within Heading 59.16/17. Chapter Note 4(a)(ii) to Chapter 59 expressly covered belting cloth, while Note 1(c) to Section XVI excluded such goods from the machinery chapter. The earlier revision order under the old tariff was based on a different statutory setting and could not govern classification under the then existing Customs Tariff.

Conclusion: The goods were not classifiable as component parts of machinery and the plea on classification failed.

Issue (ii): Whether exemption from duty under the notification issued under the Central Excises & Salt Act, 1944 prevented levy of additional duty under the Additional Duties of Excise (Goods of Special Importance) Act, 1957.

Analysis: Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 provides that the additional duty is levied in addition to the excise duty chargeable under the Central Excises & Salt Act, 1944 or any other law. The statute also applies the provisions relating to refunds and exemptions only so far as may be. On that scheme, an exemption from excise duty under the notification did not nullify the separate levy of additional duty under the 1957 Act.

Conclusion: The additional duty remained leviable and the plea for refund on this ground failed.

Final Conclusion: The appeal failed on both issues and the refund claim was rejected.

Ratio Decidendi: Where the tariff specifically classifies textile belting material within a textile heading and excludes it from the machinery chapter, it cannot be treated as a machinery component; and an exemption from excise duty does not, by itself, bar a separate statutory levy expressly made additional to that duty.

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