TaxTMI 
TaxTMI 
1998 (4) TMI 497
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....f various items as set out in the order of the ld. lower authority as also whether the longer period of limitation was invocable in the facts and circumstances of the case and the appellants liable to penalty as levied. 3. The duty demand has been raised for misclassification of - (1) Processed and un-processed fabrics of cotton and made filament yarn and fibre, (2) Non-payment of duty in respect of one side coated fabrics, (3) Articles of Double Side Coated Fabrics, (4) Prefabricated Buildings, (5) Non payment of Auxiliary duty of Excise. The other issues that arise for consideration are the limitation period applicable in terms of Section 11A and the relevant date or provision for demand of duty i.e. whether provisions of Section 9A(5) will be applicable for demanding duty. Plea made is that the relevant date applicable would be the date on which duty was quantified. Each of the issues raised is taken for discussion separately. 1st issue : Correct classification of unprocessed fabrics of cotton and man-made fibre and filament yarn. The appellants cl....
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....t. When the Central Excise Tariff Act, 1985 was brought into force, the proposed classification was called for by the department. The appellants declared to the department, the proposed description, proposed classification and declared for each type of fabrics, the name of the fabric the types of purchase manufacturers, and the end uses of such products. A.19 The following pages of the paper book have also been placed before the Commissioner in his regard. A.20 In the classification list filed in January, 1984, the classification was claimed under Tariff Item 22 describing the nature of the fabric as chafer fabrics, filter fabrics, luggage fabrics, belting fabric, impression fabric, clading shelter and giving the code numbers and also the construction of the various fabrics. (Pages 5 to 47 of Paper Book 3 containing classification lists refers). On 18-2-1986 the Inspector directed SRF to file the revised classification list consequent to the introduction of new Central Excise Tariff Act, 1985. SRF informed the Superintendent by their letter dated 21-2-1986, giving the proposed classification, proposed nomenclature, manufacturing process, name of the fabric, purchaser/ m....
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....day to allege that the Department did not know that SRF Limited, Industrial Fabric Division were manufacturing industrial fabrics. A.24 Further there was an adjudication order of the Additional Collector of Central Excise No. 24/89, dated 31-8-89 (Page Nos. 248 to 262 of Paper Book 2) wherein it has been very specifically noted that the appellants manufacture industrial fabrics in their unit at Varalimalai. The said show cause notice was issued after a detailed investigation by the Directorate of Anti-evasion, Madras. A.25 The Assistant Collector passed an adjudication order dated 7-11-89 (Pages 422 to 424) wherein among various industrial fabrics manufactured by the appellants only filter fabrics was taken up for consideration and decided that such filter fabrics would be classifiable under Heading 59.09. A.26 BONA FIDE BELIEF - The Department approved the classification lists from time to time under Chapters 52, 54 and 55 fully aware of the description of the fabric, the nature of the fabric, the types and uses, and the industry in which it is used. Further, the Central Board of Excise and Customs issued instructions for classification of such fabrics under base....
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.... fabrics This is in contrast to the description furnished in the classification list filed earlier i.e. in 1986 to 1992, they had simply mentioned unprocessed/ processed fabrics of man-made filament yarn and unprocessed/processed fabrics of cotton and so on. 6. We have considered the plea made by both the sides on the aspect of limitation. We had during the hearing perused the classification lists filed from time to time and also the copies of the correspondence filed in regard to the classification of the goods during the relevant period. It is seen that the jurisdictional Inspector of Central Excise by his letter dated 18-2-86 (page 387 of Paper Book filed) informed the appellants about the coming into effect of the new tariff and asking them to file revised classification list. The appellants vide their letter dated 21-2-86 (page 388 of Paper Book 2) enclosed a detailed write up giving proposed classification and nomenclature of the fabrics manufactured by them. The write up etc. as enclosed with this letter figures at pages 389 to 393. To illustrate the manner in which the information was furnished one of the annexure for one set of fabrics is reproduced below : Propose....
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.... fabrics and as much we have classified these as processed fabrics and have been paying AED as applicable while clearing these items. A list of all items which are heat set on the stenter by us, hence has been classified as PROCESSED FABRICS is given in the Annexure I. ANNEXURE I Items not dipped but only processed on stenter and hence classified as PROCESSED FABRICS under TI-22(1)b ITEM DESCRIPTION CL. NO: Sl. No. Filter Fabrics ISK - 105 10 30 " ISK - 137 10 30 SF - 338/105 20 50 SF - 118/105 22 60 SF - 398/915 20 50 SF - 118/137 22 60 SF - 120 17 35 SF - 120/102 15 21 SF - 157/105 23 66 SF - 129/102 23 66 SF - 188/91 21 54 SF - 188/102 15 21 SF - 169/102 23 66 SF - 368/97 21 54 SF - 389/96.5 20 50 Cladding Shelter SZ- 127/150 22 61 " SZ - 127/116 22 60 " SZ - 156/150 23 65 Float Fabric SZ - 137/140 26 83 Tarpaulin SZ - 166/150 23 67 Luggage Fabric SL - 1023/112 23 63 " SL - 1023/175 23 63 " SL - 1023/145 7. We observe that the appellants unit is named as SRF Industria....
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....ing Nos. 59.07 and 59.08), the following only :- (i) Textile fabrics, felt and felt-lined woven fabrics, coated, covered or laminated with rubber, leather or other material, of a kind used for card clothing, and similar fabrics of a kind used for other technical purposes; (ii) Bolting cloth; (iii) Straining cloth of a kind used in oil presses or the like, of textile material or of human hair; (iv) Flat woven textile fabric with multiple warp or weft, whether or not felted, impregnated or coated, of a kind used in machinery or for other technical purposes; (v) Textile fabrics reinforced with metal, of a kind used for technical purposes; (vi) Cords, braids and the like, whether or not coated, impregnated or reinforced with metal, of a kind used in industry as packing or lubricating materials; (b)  Textile articles (other than those of Heading Nos. 59.07 and 59.08) of a kind used for technical purposes [for example, textile fabrics and felts, endless or fitted with linking devices, of a kind used in paper making or similar machines....
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....words 'other material', and after each item 'bolting cloth' and preceding 'straining cloth'. Therefore, it cannot be presumed that these items 'textile fabric', 'bolting cloth' 'straining cloth' should be in 'cut piece' and be in only 'coated'. 9. We observe that the Tribunal in this order has in para 30 as above has clearly held that the fabrics as such are covered by the range of items as described in the Chapter Note to Heading 59.09. We observe that 59.09 is a residuary item and the scope of the heading as per the Chapter Note for this heading states 'Heading 59.09 applies to the following goods, which do not fall in any other heading of Section XI'. It is seen from the scheme of the Chapters under Section XI that Chapter 59 covers impregnated, coated and laminated fabrics; Textiles Articles of a kind suitable for Industrial use. Under this Chapter Tariff Heading 59.02 covers Tyre cord fabrics of high tenacity yarn i.e. fabric which is not coated or impregnated is also covered under this heading. The Chapter Heading 59.09 carries the description : "All other textiles products and articles of a unit suitable for industrial use (for example, textiles fabrics, combined with....
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....he Tariff and Notification issued under Rule 57A under which basic Central Excise duty was exempt under Notification 217/86. Additional duty in question was however payable. He pleaded that the demand in question for the period from March, 1988 to October, 1992 raised was as it is barred by limitation as the appellant had not kept anything away from the purview of the department. By letter dated 14-9-89, appellants had finished the manufacturing process of coated fabrics which is filed at pages 332 to 334 of paper book 2. The manufacturing process as set out at page 334. COATING PROCESS OF NYLON FABRICS The coating line consists of a Let-off station, an entry accumulator, a coating head, a 3 none oven, another coating head, a 5 none oven, an embossing station, a set of cooling rollers, an exit accumulator and a wind up. The nylon fabric is fixed on the Let-off station and after passing through the entry accumulator rollers comes to the first coating head where it is given a prime coat with PVC paste (a paste of PVC resin, Stabilizers, Plasticizers, fillers and bonding agent). The prime coated fabric then passes through the 3 more oven and comes to the second coating head where t....
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....hed, incomplete, not complete, disassembled, unassembled will be classified under the heading appropriate on the goods when complete, finished or assembled. Hence, the single side coated fabrics are goods attracting excisability under Heading 5903 and Addl. Duty of Excise (GSI) is leviable. The question to be decided is whether the goods unfinished or semi-finished has the essential characteristics of the finished goods. This is decided by the Larger Bench of the Tribunal in the case of BHEL v. CC, 1987 (28) E.L.T. 545. The Hon'ble Tribunal has observed thus : "It is to be determined whether the article in question has the essential character of the complete article, has attained the approximate shape or outline of the finished article and could be used only for the completion into the finished article especially with reference to the nature of material, bulk, quantity, weight or value". In this case, the only process required to bring the goods to fully finished and complete article is trimming the sides. In this connection, the judgment of the Hon'ble Supreme Court in the case of Union Carbide India Ltd. v. GOI and Others, 1986 (24) E.L.T 169 may be referred. The Hon'ble Su....
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.... a number of judgment and the judgments cited by the appellants that burden is on the department to establish marketability for levy of excise duty purposes. The appellants plea on limitation will also have to be viewed in the background of this plea apart from other circumstances. So far as the demand for the period after the receipt of the letter dated 14-9-89 is concerned the same in our view is barred by limitation inasmuch as the appellants had come on record about the manufacturing process and all stages of manufacture are mentioned therein. No mala fides or suppression of fact with intent to evade payment of duty can be attributed to them for period after that. We while holding that demand for the period after the receipt of the letter of 14-9-89 by the authorities is barred by limitation, remand the matter for de novo consideration in the respect of the period prior to that in the light of our observations above including the ques­tion and after affording the appellants opportunity of hearing. 14. The third issue relates to the demand in respect of materials manufactured out of single sided coated fabrics. He pleaded so far as this demand of about Rs. 3.76 lakhs ....
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....DPE bags was plastic and tapes etc. formed out of the same were woven into a fabric and which was stitched out into bags. In the present case also he pleaded the position was similar as the instead of Polyethylene the starting material was another type of plastic. He pleaded that benefit of exemption Notification 217/86 has not been allowed as the Chapter Heading 63.01 is not covered under this notification. 18. Even if the duty is held to be payable he pleaded that since the goods were consumed captively and the question of removal of goods from the factory the relevant rules for demanding duty would be 9A(5) i.e. the date on which duty is demanded. On that date he pleaded there was no levy on the goods and therefore the demand fails. He cited the following judgments in support of his this plea. 1987 (32) E.L.T. 234 (S.C.) - J.K. Cotton & Weaving Mills Ltd. v. U.O.I., 1986 (26) E.L.T. 701 (All.) - Swadeshi Polytex Ltd. v. ACCE, 1992 (61) E.L.T 375 (Kar.) - Durga Works v. ACCE. 19. He has pleaded that during the relevant period the appellants had paid duty through the PLA under Tariff Heading 3926 and while demanding duty this amount paid has not been given set off as ....
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.... Straps are also fixed if required by the Customers. In all their private correspondence inter office memo and other documents, these articles were described as Tarpaulins. Besides in the tenders floated by various Public Sector units and other customers, and participated by the appellants, the description furnished was Tarpaulin. But in all Central Excise docu ments, they have been described as Nylon covers. ARGUMENT OF THE APPELLANT : (i) When the raw material is falling under Heading 39.20 is finished article cannot falling under 6301 but only fall under 3920. (ii) Note (h) of Section XI of C. Ex. Tariff cleanly manipulates that woven, knitted, crocheted fabrics, felt or non-wovens, impregnated, coated, covered or laminated with plastics and articles thereof of Chapter 39 are not covered by Section XI, i.e. textiles and textile articles. (iii) Pre-impregnated cotton conveyor belting and PVC impregnated flame resistant colliery conveyor belting classifiable under sub-heading 3922.90/3926.90 of C. Ex. Tariff and not as strips under sub-heading 3920. ....
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....ics so as to protect from weather conditions, rain or sun. To illustrate, the plastic are used for coating to make it waterproof and for the longevity of the life of the article. Thus it is a fabric over which coating is done for specific purpose and it is lightly called as coated fabrics. By virtue of the predominance of weight of plastic, it cannot be considered as a plastic material and hence anything made out of these are article of plastic. The basic and essential material being a fabric and to increase the use and effective coating is done, it is the fabric that has the essential characteristic. Hence the article made out of such fabrics are made up textile article. Admittingly, there is no dispute about the applicability of definition for made up. In this context, the description section in HSN Explanatory Notes may be seen. The extract is reproduced for ready reference :- "Section VII - TI. 39.26 page 622. 3926 other articles of....
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....cially shaped (e.g. for covering hay bricks, deckes of small vessels, lorries etc). Also fall in this heading provided they are flat. Tarpaulins should not be confused with lorry covers for motor cars, machines etc. made of tarpaulin material to the shape of these articles, nor with flat protective sheets of lightweight materials made up in similar manner of tarpaulins. Awnings, Sunblinds (for shops and sales etc). These are designed for protection against the sun they are generally made of strong plain or striped canvas, and may be mounted on roller or folding mechanisms. They remain classified in this heading even when provided with frames as in sometimes the case with sunblinds. (4) Tents, are shelters made of light weight to fairly heavy fabrics of man-made fibres, cotton or blended textile materials, whether or not coated, covered, laminated or of canvas. They usually have a single or double roof and sides or walls (single or double), which permit the formation of an enclosure. The heading covers tents of various sizes and shapes, e.g. marquees and tents for military camping (including backpack tents), circus, beach use. They are classified in ....
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....d under heading 3926 of the Central Excise Tariff. INVOKING OF EXTENDED PERIOD A chart showing the description furnished in the price lists, that in the classification list that in the Purchase Order, is furnished in the Annexure. As may be seen from the chart that as against the description furnished in the Purchase Order "Nylon Tarpaulin" in classification list, price list, gate passes, the same was described as Nylon fabricated covers. The copies of Purchase Orders furnished by the appellants to the department along with the price list and copies of those purchase orders recovered from the customer during investigation are also produced for perusal. 23. We have considered the pleas made by both the sides. We first proceed to examine the issue of limitation. We observe that as seen from the record that the appellants had been filing classification lists and price list regularly. The copies of same of the price lists have been filed before us for the period 1987 onwards as referred to in the pleadings of the ld. Advocate. The price lists carry the description of the goods by name, code number of their product, the classification and the reference of the classification li....
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....Tariff item. No external aid is required so far as classification under Heading 39.26 is concerned when articles covered thereunder are such as are made out of the materials falling under Tariff Heading 39.01 to 39.14. The plea of the ld. Advocate that fabric is manufactured out of Nylon a material falling under a Tariff Heading as above and thereafter coating is also of one such material, therefore the fabric should be equated with the materials of 39.01 to 39.14 for the purpose of classification under Tariff Heading 39.26 by reason of trickle down effect on face of it cannot be accepted. It would tantamount to adding Chapter Heading 39.20 into the entry of materials in addition to 39.01 to 39.14 mentioned therein. The Tribunal cannot assume the legislature function by holding so. We therefore on first principles hold the goods tarpaulin is not covered by Tariff Heading 39.26. We observe that tariff entry 63.01 specifically includes this item under that heading. No doubt under Section note 1(d) of Section XI under which tariff entry 63.01 figures the articles of coated fabrics which fall under Chapter 39 are not to be classified under this Section but since the item in question as....
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.... 33. [Contra per : T.P. Nambiar, Member (J)]. - I have perused the orders passed by the learned Vice-President. As far as the first issue is concerned, I agree with the orders passed by the learned Vice-president holding that the demand is barred by limitation. 34. As far as the classification issue is concerned, the learned Vice-President had held that the goods in question are classifiable under 59.09. In this connection it should be noted that the case decided by the Tribunal in Simplex Mills case reported in 1993 (49) ECR 147 was passed on the principles laid down by the Hon'ble Supreme Court in Multiple Fabrics case. However, the correctness of the decision in the case of Multiple Fabrics was doubted by the Hon'ble Supreme Court and it was specifically overruled in the case of Collector of Central Excise v. Fenoplast (P) Ltd. reported in 1994 (72) E.L.T. 513. Thus the decision rendered in Multiple Fabrics Pvt. Ltd. case of the Tribunal cannot be held to be a good law in view of the decision reported in 1994 (72) E.L.T. 513. This aspect of the case was not taken into consideration while Simplex Mills case was decided as the decision in the case of Fenoplast was not availa....
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....cular product will be treated for the purposes of Excise duty. It does not lie in the mouth of the Revenue to repudiate a circular issued by the Board on the basis that it is inconsistent with a statutory provision. Consistency and discipline are of far greater importance than the winning or losing of court proceedings. 15. The argument that the later circular has only prospective operation and that it cannot apply to these appeals because the Tribunal had already decided them must also be rejected. It is not open to the Revenue to raise a contention that is contrary to a binding circular issued by the Board. It cannot but urge the point of view made binding by the later circular." 36. In order to appreciate the contentions of the learned Advocate the Circular issued by the Board is reproduced below : "Grey Cotton Canvas Cloth, Cotton Ducks, Cotton Tyre Cord Fabrics and Cotton Belting Fabrics - [Heading 52.05] The Trade has represented on the issue of lack of uniformity in the classification of Grey Cotton Canvas, Cotton Ducks, Cotton Tyre Cord Fabrics and Cotton Belting Fabrics. Such products have been classified either under Chapter Heading No. 52.05 or under Headin....
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....sued under Section 37B cannot be binding upon a quasi judicial authority under the Act, the departmental officers conducting the lis before such quasi judicial authority cannot take a stand contrary to the directive/instruction issued. (2) The instructions which may be binding on the Central Excise Officers are not binding on the Assessee who may question the correctness of the same before a quasi judicial authority and before a Court. Both the quasi judicial authority and fortiori, the Court, can question the correctness of the instructions. (3) An assessee has on the other hand the right to claim and the court may compel compliance with such instructions as are for the benefit of the assessee by the Central Excise Officers. 19. Applying the aforesaid principles I am of the view that it is not open to the respondents to contend contrary to the circular that the yarn is classifiable under sub-heading 5504.39 and not sub-heading 5504.32 of the Schedule to the Act. 37. However, in the case reported in 1981 (127) ITR 1 (Guj.), the Hon'ble Gujarat High Court at pages 5, 6 and 7 held as follows : As to what is the effect of the circular issued by the Board of Di....
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....ring them within the mischief of the new provision.' The directions given in that circular clearly deviated from the provisions of the Act, yet this court held that the circular was binding on the Income-tax Officer." These two decisions of the Supreme Court in Navnit Lal C. Zaveri's case [1965] 56 ITR 198 and in Ellerman Lines Ltd.'s case [1971] 82 ITR 913 were considered by this court in Bechardas Spg. & Wvg. Mills Co. Ltd. v. CIT (Income-tax Reference No. 153 of 1976, decided on 11th March 1977*) by the Division Bench consisting of J.B. Mehta Acting C.J. and D.A. Desai J. There it was observed : "We need not reiterate that the position of such benevolent circulars issued under section 119 of the Act for meeting such cases of extreme hardship stands well settled after the decision of their Lordships in Navnit Lal C. Zaveri v. K.K. Sen [1965] 56 ITR 198 (S.C.). at page 203, and in Ellerman Lines Ltd. v. CIT (1971) 82 itr 913 (S.C), at page 923. There their Lordships pointed out that the directions in such benevolent circulars, even though they may be deviating from the provisions of the Act, would be binding on the Income-tax Officers." This position is well accepted and there....
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....e Calcutta High Court as well as the Gujarat High Court which are mentioned above. 39. As far as the second issue is concerned, under the impugned order the learned lower authority has demanded additional duty of excise under the Additional Duties of Excise (Goods of Special Importance) Act. In respect of one side coated fabrics which has, according to the appellants, emerged at the intermediate stage in the course of manufacture of double side coated fabrics. The learned Vice-President has extracted the arguments of both the sides at paras 11 and 12 of the order and there is no necessity for me to repeat the same. It has been held by the learned Vice-President that the demand for duty after the receipt of the letter dated 14-9-1989 is barred by limitation. I agree with this finding. However, it was further held that the matter is to be remanded for de novo consideration in respect of the period prior to that and to find out whether these are goods. I am respectfully not able to agree with this finding of the learned Vice-President for the following reasons. 40. It is now seen that the case of the appellants is that the single side coated fabrics coming at the intermedi....
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....d. & Anr., reported in 1997 (92) E.L.T. 315 (S.C.) = 1997 (20) RLT 363 at para 8 held as follows : 8. Learned counsel for the appellant submitted that Tariff Entry 14AA(1) was attracted, whatever might be the further process that the calcium carbide manufactured by the respondent might have to undergo by way of purification or packaging for that would not be tantamount to further manufacture. We are unable to agree for the simple reason that the commodity which is sought to be made liable to excise duty must be a commodity that is marketable as it is and not a commodity that may by further processing be made marketable. Therefore the decision of the Commissioner holding that one side coated fabrics are goods is without any evidence in this regard. 41. Once when the burden was on the Department to prove the same, and when no such evidence is produced by the Department, the question of remand also does not arise. In similar circumstances the Hon'ble Supreme Court in the case of Hindustan Ferodo Ltd. v. Collector of Central Excise reported in 1997 (89) E.L.T. 16 (S.C.) = 1996 (17) RLT 807 (S.C.) at paras 3 to 7 held as follows : 3. It is not dispute before us, as it....
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....s made in the impugned order is not sustainable and I set aside the above said demand on this behalf. 43. As far as point No. 3 is concerned, the learned Vice-President has held in the order that this issue was not contested by the appellants and the demand is to be re-confirmed. As far as this issue is concerned, it was the claim of the appellants that the classification of one side PVC coated fabrics should be under Heading 59.09 as textile articles. The classification list was filed in May, 1992 and was not approved and the notice was issued by the Assistant Commissioner proposing re-classification of the same under Heading 63.01. The demand confirmed by classifying this article under Heading 63.01 in the impugned order is Rs. 3,29,289/- for the period from May, 1992 to October, 1992. The demand is raised on the ground that Heading 63.01 in which it is proposed to be re-classified is not a declared final product for filing exemption under Notification 217/86-C.E. and Notification 177/86-C.E. or Modvat credit and therefore on the one side coated fabrics the duty as required is to be paid. Since this issue was not contested before us during the course of the arguments. I als....
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....ally mentioned under Heading 63.01 and there­fore it is classifiable under Heading 63.01. 47. But it is seen that there is no dispute about the classification of double side coated fabrics under Heading 39.20.12. This heading reads as under : "Other plates, sheets, film, foil and strip, of plastics, non-cellular, whether lacquered or metallised or laminated, supported or similarly combined with other materials or not." 48. In this connection the double side PVC coated product is considered as sheet of plastic combined with materials like textiles and accordingly it is classifiable under Heading 39.20. It is therefore clear that Tariff Heading declares the product as sheets of plastic combined with textile materials notwithstanding the description of Heading 39.20 it cannot be argued that the same is still a textile product. Similarly Chapter Note 2(a)(3) of Chapter 59 takes away the product from Chapter 59 and brings the same into the ambit of Heading 39.20. Therefore it is seen that once the product is declared by the Tariff as sheets of plastic combined with textile materials, the same should come under Chapter 39.20 only. 49. In this connection it is neces....
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....nd articles of plastics in question are made by coating PVC compound on both sides of nylon fabrics. Nylon fabrics were made out of nylon strips. Thus the resin and nylon falling under Heading 39.08 on being drawn into filaments and is made into fabrics was classifiable under Heading 54.08 of coated on both sides with PVC compound the classification of such double side PVC coated fabrics reaches back to Heading 39.20 as sheets of plastics. Any article made out of the whole plastic materials has to necessary fall under Chapter 39.26. In this view of the matter the classification claimed by the appellants under Heading 39.26 has to be upheld. 51. In this connection the learned Advocate for the appellants had also relied upon the decision of the Hon'ble Madhya Pradesh High Court reported in 1990 (50) E.L.T. 201 in the case of Raj Pack Well Ltd. v. UOI. In that particular case HDPE strips less than 5 mm was classified under Chapter 39 and so also the fabrics made therefrom. HDPE sacks made out of such fabrics were classified as articles of plastics and not as made out textile articles under Heading 63.01. In that particular case the Revenue has contended that the stripes of fabri....
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....Whether the demand in this regard is not sustainable and is liable to be set aside as held by Member (Judicial); (iii) Whether in the facts and circumstances of the case, as per issue Nos. 4 and 5, whether the goods in question are to be classified under Heading 63.01 as held by the learned Vice President; (OR) Whether the goods in question are classifiable under Heading 39.26 as held by Member (Judicial). Sd/- (T.P. Nambiar) Member (T) Sd/- V.P. Gulati Vice-President 53. [Order per : S.L. Peeran, Member (J)]. - The difference of opinion between the Vice-President and Member (Judicial) in terms of the points of difference at pages 52 and 53 (as above) was heard by me. 54. The ld. Advocate Shri V. Lakshmikumaran submitted his arguments on behalf of the appellants and ld. CDR, Shri M.C. Sharma, defended the Revenue in the matter. 55. I shall be proceeding to give my reasonings on issue-wise determined by both Members and during the course of....
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....ot expressed his opinion on this point but has proceeded to deal with the classification issue and held the same to be classifiable under Chapter 59. However, the ld. Member (J) has not expressed any opinion on the classification but has held in para 35 after relying on one judgment of the Hon'ble Supreme Court and other two judgments of High Court that the matter is required to go back to the Commissioner for re-determination in the light of the circular as the circular has a binding effect. 57. I have heard arguments of both sides on this point. The ld. Advocate stressed the point that the Vice President ought to have also applied his mind and should have expressed - his opinion with regard to applicability of circular issued by the Board under Section 37B. He submits that the Third Member is now left with no option but to agree with the Member (J) on this point as Commissioner has also not expressed his opinion. I have heard the ld. CDR also on this point. 58. In my considered opinion, the matter is required to go back to the Commissioner for determining the applicability of Trade Notice in terms of the judgments noted by the Hon'ble Member (J) in paras 34 and 35 of ....
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....t in para 13 has observed that : "We observe the question to be answered is whether embossing changes the character of the product in a manner to render it usable and without that the goods cannot be used. This requires detailed examination taking into consideration the opinion of expert, technical literature and the nature of the goods as manufactured by the appellants. We had asked both the sides to produce evidence in this regard. We find that it has not been possible at this stage to bring on record technical opinion and nor it is feasible to get market enquiries to be caused. The evidence filed is not conclusive. It is settled position in law as held by the Hon'ble Supreme Court in a number of judgments and the judgments cited by the appellants that burden is on the department to establish market­ability for levy of excise duty purposes." Thereafter, the ld. Vice-President has remanded the matter for de novo consideration. 66. This point has been deferred to by the ld. Member (J) and has held that the conclusion after this finding should be that the department has not proved their case on marketability and that the Revenue not having discharged the same, the appeal....
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.... department issued show cause notice for reclassifying the same under Chapter Heading 63.01. The ld. Vice-President has held the item is to be classified under Chapter Heading 63.01, while the ld. Member (J) has held the article to be classifiable under Heading 39.26 of the Tariff. However, both the Members have agreed that the demands raised are barred by time. 72. As regards the classification of this item, I agree with the final conclusion of the Vice-President for different reasons, that the item is required to be classified under Chapter Heading 63.01. The items in question are "tarpaulins, awnings". Both these items have got a specific tariff description under Chapter Heading 63.06. In terms of Note 1 of Rules, for the Interpretation of the Tariff the classification has to be determined according to the terms of the headings and in relation to the section and Chapter Notes. By applying this Rule, the classification adopted by the department under Chapter Heading 63.01 is appropriate and is required to be accepted. 73. The ld. Counsel submits that the item is made from fabrics coated on both sides by PVC and it is his contention that Chapter 39.20 covers other plat....