1994 (9) TMI 143 - AT - Central Excise

Tribunal upholds classification as 'Sizing Mixture,' exempts from duty under Notification 18/89

The Tribunal dismissed the department's appeal, upholding the Collector (Appeals) decision regarding the classification of the product as a 'Sizing ... Dutiability - Marketability of goods essential for levying excise duty Issues:- Classification of the product under Chapter 38.09 for excisability- Confusion between 'Sizing Agent' and 'Sizing Mixture'- Interpretation of Notification No. 18/89 for exemption from dutyAnalysis:1. The appeal was filed by the department against the order of Collector (Appeals), Madras, concerning the excisability and classification of a product manufactured by the Respondents.2. The department argued that the product, 'Sizing Mix,' obtained by the Respondents through a manufacturing process, should be classified under Chapter 38.09 as an excisable item.3. The Respondents contended that the product is not a manufactured item but a mixture of various sizing agents procured from the market and processed for use in sizing, emphasizing that it does not have a shelf life and is not marketable.4. The Assistant Collector's order supported the excisability of the product, but the Collector (Appeals) overturned it, accepting the Respondent's version without concrete evidence of marketability or shelf life.5. The Respondents highlighted that the Ministry had exempted sizing agents falling under Chapter 38 from duty under Notification No. 172/87, indicating the excisability of such products.6. The debate centered on the distinction between a 'Sizing Agent' and a 'Sizing Mixture,' with the Respondents asserting that their product was a mixture of agents prepared for immediate use, not a standalone agent.7. The Tribunal noted the lack of evidence provided by the department regarding the marketability of the product, leading to the unsubstantiated nature of the department's case for demanding duty on the product.8. Additionally, the Tribunal considered Notification No. 18/89, dated 6-4-1989, which covered the relevant period and provided exemption from duty for products falling under Heading 38.09, further supporting the dismissal of the department's appeal.9. Ultimately, the Tribunal found no grounds to interfere with the Collector's order and dismissed the appeal, concluding that the department had failed to establish the excisability of the product or the liability for duty based on the available evidence and legal provisions.