TaxTMI 
TaxTMI 
1997 (1) TMI 537
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....No. 9 of Chapter 40 which is reproduced below for convenience of reference : "9. In heading Nos. 40.01, 40.02, 40.03, 40.05 and 40.08, except as otherwise provided, the expressions 'plates', 'sheets' and 'strips' apply only to plates, sheets and strip and to blocks of regular geometric shape, uncut or simply cut to rectangular (including square) shape, whether or not having the character of articles and whether or not printed or otherwise surface-worked, but not otherwise cut to shape or further worked. In Heading No. 40.08, the expressions 'rods' and 'profile shapes' apply only to such products, whether or not cut to length or surface-worked but not otherwise worked. Sub-heading No. 4008.21 shall also apply to "plates", "sheets" and "strips", whether or not cut to shape, and surface-worked or further worked so as to render them fit for resoling or repairing or retreading of rubber tyres." The learned Original authority held that the appellants' product fall within the ambit of the said tariff heading in terms of sub-para 3 of note above. The learned CCE (A) upheld the classification as held by the learned original authority. The two competing ite....
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....e available evidence on record. 5. The learned Counsel for the appellants filed write up before us relating to the manufacture of the item in their factories at Hyderabad, Cochin and Pondicherry. He has pleaded that in respect of the similar goods manufactured in their Hyderabad factory an issue had arisen earlier whether the goods would be assessable under Tariff Heading 16A(2) or Tariff Heading 68 of the erstwhile tariff and the matter was ultimately decided by the Tribunal by their decision reported in 1992 (61) E.L.T. 107 holding the goods to be assessable under Heading 16A(2) as sheet of rubber. The erstwhile Heading 68 reads as under : "All other goods, not elsewhere specified but excluding xxx xxx xxx" Before amendment to Chapter Note 9 of Chapter 40 as above, the item was classified under Chapter sub-heading 4016.99 and not under sub-heading 4008.21. He has pleaded that so far as their Hyderabad factory is concerned, the product has been held to be sheet and no reason as such has been entered in the lower authority's order as to the basis for holding it so and further finding has been entered that the same is of rectangular shape without any basis. It has also....
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.... would not fall under sub-heading 4008.21. (4) Even after amendment in the chapter note by virtue of the above, goods have to be shown to be as plates, sheets or strips before the same could be classified under Heading 4008.21. (5) Burden is on the Revenue to show how the goods can be treated as plates, sheets, and strips and since no evidence has been brought on record, in this context, the goods would not be assessable under Heading 4008.21. For appreciation of the points mentioned by him he referred us to the manufacturing process as filed by the appellants in the paperbook and also the note which is submitted before us. The copies of these are enclosed as Annexure I to this order for ready reference. The write of the manufacturing process filed by the department is also enclosed as Annexure II to this order. The write up as filed in the paperbook in case of Appeal No. E/5448/93-C is also enclosed as Annexure III to this order. 6. The learned Counsel for the appellants also referred to the manufacturing process as placed before us and pleaded that essentially the manufacturing process in various units as placed on record by the department and by the ap....
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....extrusion process that produces an essentially finished extrudate, as against one that produces a coating on wire or an intermediary material or parison. (3) HSN Explanatory notes to Heading 40.08 at page 590 reads as under :- "Profile shapes are obtained in the length in single operation (generally extrusion) and they have a constant or repetitive cross-section from one end to other". (4) The Board's circular dated 13-8-1986 reported in 1986 (26) E.L.T. T14 reads as under :- "A doubt has been raised with regard to classification of certain rubber products as profile shapes of non-cellular rubber. The matter has been examined in the Ministry. It is clarified that in the Explanatory Notes to the HSN, it has been explained that profile shapes are obtained in the length in a single operation (generally extrusion) and they have a constant repetitive cross-section, from one end to the other". (5) IS 7503 Part - I - 1988 deals with Glossary of Terms used in Rubber Industry. Part - I of this glossary contains definitions of basic terms. Para 2.1.2. reads as under :- "2.1.2. Extrudate - A profile produced by extrusion of ....
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....ative Section or Chapter Notes .......". The Notes relative to Chapter 39 state that Heading 39.22 for the earlier period applies to conveyor belts. For the earlier period Tariff Heading 39.26 must, therefore, be read as applicable to the appellants' conveyor belts. For the later period, the Explanatory Note to Tariff Heading 39.26 in the Harmonised Coding System, which is identical to Tariff Heading 39.26 of the Tariff Schedule, must be taken to be a guide, for the Tariff Schedule is based upon the Harmonised Coding System. That apart, we are unable to uphold the Tribunal's finding that the belting made by the appellants is a "strip". An article which is over 100 metres but only up to 1200 millimetres in width cannot be described as a "strip". Tariff Entries 3920.11 and 3920.12 cannot, therefore, be made applicable to the belting made by the appellants. For the later period, Tariff Heading 39.26 must be read as applicable to it." He has pleaded that this decision was given in the context of conveyor belt and the ratio would equally apply to the facts of this case. The product which is extruded is described as belt at the stage prior to extrusion as set out in the manufacturing ....
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....partment referred us to the process of manufacture and pleaded that the appellants' product in the pre-extrusion stage was in sheet form and which has been mentioned as belt by the learned Counsel and therefore, the appellants goods can be taken to be answering to the description as set out in the Chapter Note 9 of Chapter 40. He has pleaded that while nomenclature of the item has been mentioned as held by the appellant to identify the product at the pre-moulding stage the same was nothing but in sheet form. In this connection he referred us to the finding of the CCE (A) in Appeal No. E/1129/92-C filed by M/s. Sundaram Industries which is reproduced below for convenience of reference : "The profiles which do not qualify to be called as plates, sheets and strips have been classified under other forms in the Central Excise Tariff. Out of the examples enumerated in respect of other forms profile shapes are also covered. Thus profile shape should be understood as such of the extruded products which do not have regular geometric form of cross-section and or which are not cut or cut to other than rectangular shapes and or having been subjected to further working. Even according ....
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....ff heading. 9. In regard to the Board's file it was pleaded by the SDR that the Board has claimed privilege in respect of the same and as such he is not able to produce the same before us. 10. The learned Counsel for the appellants in the end pleaded that in Appeal No. E/5448/91 there is an additional issue involved i.e. the appellants sought for benefit of Notification 71/68 which has been denied to them. He has pleaded that the appellants are entitled to the consideration of the benefit in terms of another Notification 377/86 available in respect of plates and sheets and strips. He has pleaded that this notification was not considered by the lower authority while passing the order and sought for remand of the matter for this limited purpose. The learned SDR has no objection in this regard. 11. In regard to classification of precured treads the issue of classification of which is before us for our consideration, we observe that both the sides accept that the classification of the same before the amendment to Note 9 of Chapter 40 in 1990 by addition of sub-para (3) therein, was under heading 4016. The controversy as to the classification, arose only by intro....
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.... merit classification under sub-heading No. 4016.99. Consequently, there would be no question of extending the benefit of Notification No. 47/76-C.E., dated 9-3-1976, as amended, to such goods. 4. The above guidelines may be brought to the notice of the lower field formations and the trade interests may also be suitably advised. 5. All pending assessments may be finalised on the above basis. Going by the view as above, and which view has not also been disputed by the assessee, that the assessment under tariff 4016.99 has all along been accepted after introduction of the new tariff and before amendment of Chapter Note 9 above. The question to be examined is whether the scope of the term "plates, sheets etc." has been enlarged to cover within its ambit precured treads as emerged in the form which has been described in the Board's instruction above, by change of its shape by moulding to trapezoidal form. It is therefore, necessary for us to refer to Chapter Note 9 which we have reproduced earlier and which is reproduced below : "9. In heading Nos. 40.01, 40.02, 40.03, 40.05 and 40.08, except as otherwise provided, the expressions 'plates', ....
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....ed rubber and were usable for resoling, repairing and retreading of rubber tyres. Under the unamended note, i.e. in terms of sub-para (1) and (2) of Note 9 the items had to first answer to the description of plates, sheets and strips which could be in uncut form and if cut the same could be considered still to be falling under heading 4008 if these were cut to rectangular shape including square shape and the same could be printed or otherwise surface worked but should not have been further worked. This item that could fall under this heading going by shape had to be plates, sheets, and strips and if cut as have been mentioned earlier only such of those items which were cut in rectangular and square form and this could be only surface worked. The term surface worked has not been defined in the tariff but the same technically could be only taken to be process by which surface of the plates, sheets etc. had been subjected to some finishing process. Thus if there was other type of working of these sheets etc. or even if the same were cut to in other shape other than rectangular or square these would go out of the ambit of tariff 4008. By amendment of tariff 1990 by introduction of sub-....
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....plates, sheets and strips which have been prepared for being used for resoling or repairing or retreading in any form, whether further worked or surface worked are the ones which have to be sought to be included. The appellants' products answers to use as set out under sub-note 9 of Chapter 40. Earlier to this under 4008.21 plates, sheets and strips for the said purposes could be only such as were merely surface worked and if cut then these had to be in rectangular or square shape. These constraints as mentioned above were taken off for classification purposes under this item by sub-note (3) of Chapter Note 9 and the material could be of any shape and could also be further worked over and above surface working. As seen from the manufacturing process placed before us, the product of the appellants are manufactured out of the strips and sheets and which have been subjected to moulding which brings the goods within the category of vulcanised plates, sheets and which have been further worked and also have been formed into shape other than rectangular and square. The appellants plea is that the appellants' goods are not plates and sheets but are only profile shapes and therefore would n....
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....f the tyre by retreading/resoling the same. This clearly can be considered as sheets and strips which have been formed into or cut into a particular shape and further worked on the surface of the sheet. The appellants have sought to place a restricted meaning on the term plates and sheets and have urged that these have to be considered in contradistinction to profile shapes. We observe that the sub-para (3) of Note 9 was introduced in 1990 for limited purpose of including the material which is manufactured for resoling or repairing or retreading of rubber tyres under heading 4008.21. So long as the material could be viewed as one in plates, sheet form and same has been surface worked or further worked or cut to any shape to make it suitable for that purpose, then even if the material is considered as profile shape in profile form the same would still figure within the ambit of heading 4008.21. By note in sub-para (3) of Note No. 9 an exception has been carved out to bring within the ambit of Tariff Item 4008.21 such material rendered usable for the specific purpose in the note. Tariff Item 4008.21 has specific material in the form mentioned thereunder which are for resoling, repair....
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....at case to adjudicate between the two competing items of rubber as in the new tariff. The interpretation that was sought from the Tribunal in the context of Tariff Heading 16A(2) and the residuary Item 68 of the erstwhile tariff. The Tribunal entered their clear finding that the goods were to be considered in the form of plates and sheets. The amendment of Note 9 as above removes the constraint of shape as was found applicable earlier. We in the circumstances dismiss the appeals of the appellants and uphold the order of the learned lower authority and hold that the goods are assessable under heading 4008.21. 15. A plea has also been made that the appellants' product manufactured being more in the nature of running length cut to some desired width was only sheeting and not sheet. We observe that sheet rubber is defined as under in the Mc Graw-Hill Dictionary of Scientific and Technical Terms second edition : "Sheet rubber (Matter) Latex that has been rolled into sheets either smooth or ribbed". The long rolls of sheet are also covered by this definition. The appellants plea therefore has no force. In regard to the issue regarding Notification 337/86 which was ....
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....rubber is cut and the skid is removed. The approximate length of the continuous sheet will be 150 m.   (b) Final Batching : The master batch produced as explained in (a), is weighed as required, for final batching again in the Intermix. Here, required rubber chemicals are added in the right proportion, to the master batch and mixed for 2.5 to 3.5 minutes. The final batch also is mixed, dumped on the Mixing mill and taken out in continuous sheet form similar to the process as explained in (a). The mixed final batch, which is now available in wig-wag form, is removed for the next process namely 'Extrusion'.   II. EXTRUSION :   (1) Extrusion with Cold Feed Extruder (Palakkad) The final batch from the skids [as explained in (b)] is fed into the extruder continuously. The rubber comes out of the extruder continuously in the required width and thickness. This hot material is cooled on a conveyor. After cooling the extrudate is cut at the required length of approx 3.0m, per specification. These profiles after cutting, called Preps, are stored for moulding.   (2) Extrusion with Hot Feed Extruder (Hindupur and Pon....