TaxTMI 
TaxTMI 
TaxTMI 
1997 (4) TMI 329
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.... the learned lower appellate authority confirmed the decision of the learned lower authority holding that the adhesive in question is classifiable under 40.05. It is this matter which under appeal in the present case. 3. The learned Advocate Shri Sridharan appearing for the appellants contended before us that this finding of the lower authorities is not in accordance with law. In this connection he pointed out that there is no material evidence to support the conclusion of the learned lower authority that the product of the appellants consists of unvulcanised rubber in toluene solution. He further pointed out that the Chemical Examiner's report is non-speaking and it cannot be relied upon. He pointed out that in the impugned order in para 5.3 the Collector (Appeals) has compared the heading 35.06 of Central Excise Tariff with HSN and concluded that the portion of HSN relating to products suitable for use as glues or adhesives are not appearing under this Central Excise Tariff and therefore this portion of HSN has to be ignored. He pointed out that this point is irrelevant for determining the matter in the issue. He pointed out that admittedly the product of the appellants con....
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....regard. He pointed out that the patches will cure even if the CVC is applied without heat or pressure. He further pointed out that the learned Collector erred in distinguishing the decision of the Tribunal reported in 1988 (34) E.L.T. 404 in the case of Elgi Polytex Ltd., Coimbatore v. Collector of Central Excise. In this connection he pointed out that the functional characteristics and use of the product is to be taken into account and if this is taken CVC is nothing but an adhesive. He also pointed out that in the Assistant Collector's orders he admitted this position by observing as follows : "It may not be wrong to say here that the Department is not disputing the fact that CVC is an adhesive." However, he pointed out that in any case the Tribunal's decision in the Deccan Rubber case which is relied on by him in Order Nos. 828 to 830/90-C, dated 26-7-1990 squarely applies to the facts of this case. He pointed out that in that case the product did not contain any of the ingredients. It was essentially natural rubber dissolved in organic solvent, still the Tribunal held it to be an adhesive falling under 35.06. The same view was followed by the Tribunal in the case of Abilash R....
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....ance with law and prayed that the appeal may be allowed. 4. The learned DR on the other hand pointed out that the Chemical Examiner's report says that CVC is in the form of dull dispersion composed of unvulcanised compounded rubber in vilatile organic solvent. He pointed out that the appellants' product is sold in the name Chem Bond and is reportedly used for binding criss cross patches to the worn out and damaged tyres to repair any holes or cracks existing on the tyre surface. 5. He also pointed out that Heading 40.05 is adopted as it is in Central Excise Tariff Act and HSN but other sub-headings in the HSN. He further stated that Heading 35.06 under the HSN was not adopted in toto in the Central Excise Tariff. It was also pointed out that CVC which is unvulcanised rubber with accelerators dissolves in toluene solution is to be treated as a compounded rubber unvulcanised in primary form. It was also contended that according to the HSN notes also the Heading 40.05 includes compounded rubber not containing carbon black silica but containing substances like organic solvents, vulcanising agents, accelerators, Plasticisers, extenders, thickeners and fillers, it was also po....
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....essary that it should always contain resin as was contended on behalf of the Department. 7. The point for determination is whether rubber adhesive is classified under 40.05 or 35.06. In the case of Elgi Polytex Ltd., the Tribunal at paras 9, 11 and 13 held as follows : "9. Sub-heading No. 3501.90 under Heading No. 35.01 reads "Albuminoidal substances; modified starches; glues; enzymes, - other". The argument is that since the subject product acts as an adhesive (and there is no dispute about this) it is a glue. Glue and adhesive are synonymous terms in accordance with the Glossary appearing at pages 1 to 3 of Book "ADHESION AND BONDING" Edited by Norbert M. Bikales, published by WILEY-INTERSCIENCE. The tariff schedule as amended on 10-2-1987 has Heading No. 35.06. Sub-heading 3506.00 under this heading reads "Prepared glues and other prepared adhesives, not elsewhere specified or included". The claim for classification based on the above two headings seems to be well founded. 11. As noted at the outset the subject product contains, apart from rubber compound and solvent, sulphur, carbon black, stearic acid, zinc oxide, fillers and accessories. The product answers ....
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.... may be seen from Heading 35.06 of the CET (reproduced earlier), there is no corresponding description. The subject product, as seen from its composition, contains rubber in solution in an organic solvent, sulphur (a vulcanising agent), fillers and resin. Its use is admittedly as an adhesive in retreading of tyres. There can, therefore, be no doubt that the correct classification of the product is as a prepared adhesive or glue in Chapter 35 of the Central Excise Tariff Schedule. 13. In the result we allow the appeal, set aside the orders of the lower authorities and direct that the product "rubber cement" or "black vulcanising cement" manufactured by the appellants shall be classified under Heading No. 35.01 (sub-heading 3501.90) during the period prior to 10-2-1987 and under Heading No. 35.06 (sub-heading 3506.00) on and from 10-2-1987. This decision was sought to be distinguished on the ground that in the product which the Tribunal was dealing, resin was present. In this connection the learned Advocate drew our attention to the decision of the Tribunal in the case of Deccan Rubber Solution Manufaturing Company v. Collector of Central Excise, Bombay in order Nos. 828 to 830/90-....
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.... the Tribunal's decisions referred to supra clearly apply to the facts of the present appeal, and in this view of the matter, we set aside the impugned order and allow the appeals." It is thus seen that in that case also the product was vulcanising solution manufactured by mixing natural rubber in organic solvents and had upheld the classification under Heading 35.06, following the ratio of Elgi Polytex Ltd. 8. In the decision of the Tribunal in the case of Collector of Central Excise, Hyderabad v. India Rubber Products in Order Nos. 76 & 77/1990-C, dated 3-1-1990, the Tribunal considered the classification of similar goods and in paras 7 and 8 the Tribunal held as follows : Purused the record. The goods in the Elgi Polytex case were "rubber cement" or "black vulcanising cement" having the following chemical composition :- Natural rubber - 6.67% Sulphur - 0.25% Solvent - 88.00% Balance - consisting of carbon black, stearic acid, zinc oxide, filler and accelerators - 5.08% and Rubber compound - 11.00% Soluble sulphur - 0.30% Resin - 1.00% S.B.P. Spirits - 87.00% In the present instance, the detailed break-up of the chemical composition is not availa....