1990 (9) TMI 288 - AT - Central Excise

Summary

Issues:
1. Excisability of synthetic resins used in the manufacture of plastic laminated sheets under T.I. 15A(i) of the Central Excise Tariff.
2. Classification of synthetic resins as excisable goods based on marketability and shelf-life.

Detailed Analysis:

Issue 1: Excisability of Synthetic Resins
The dispute in this appeal revolves around the excisability of synthetic resins, an intermediate product used in the manufacturing process of plastic laminated sheets under T.I. 15A(i) of the Central Excise Tariff. The Assistant Collector classified the solutions as synthetic resins falling under T.I. 15A(i), emphasizing that the solutions were in a resin state despite being under the reaction of polymerization at the time of sample drawal. The samples were found to be in a solid state, indicating full polymerization during transit due to the continuous reaction in the absence of stabilizers. The solutions were considered resins in a resole state, falling within the scope of Tariff Item 15A, which includes liquid resin whether or not polymerized. The lower appellate authority, however, reversed the classification, stating that synthetic resins consumed in the manufacture of plastic laminated sheets, being wastable and non-marketable, are not excisable under T.I. 15A(1).

Issue 2: Classification Based on Marketability and Shelf-Life
The appellant argued that the synthetic resins are marketable with a shelf-life of 15 days as authorized by the Collector, making them excisable goods. Conversely, the respondent contended that the products have a short shelf-life and are not marketable, citing the Asstt. Collector's observation. The respondent emphasized that marketability is a crucial factor for excisability, as established in previous court decisions. The Asstt. Collector had found the goods to have a short shelf-life, and the Department failed to provide evidence to challenge this finding regarding the unstable nature of the synthetic resins. Referring to the Supreme Court's decision in Bhor Industries case and a Tribunal case involving phenol formaldehyde resin, the judgment upheld that unstable, non-marketable products are not liable to excise duty under Item 15(A) CET.

In conclusion, the Tribunal upheld the findings of the Collector, dismissing the appeal as the Revenue did not demonstrate that the synthetic resins in question were stable and marketable. The decision aligned with previous rulings emphasizing the importance of marketability and stability for the excisability of goods, ultimately determining that the synthetic resins did not meet the criteria for excisability under T.I. 15A(i) of the Central Excise Tariff.