2008 (8) TMI 632 - AT - Central Excise

Summary

Issues:
Classification of Polyvinyl Acetate Emulsion under Heading 39.05 or 35.06.

Analysis:
The dispute in this case revolves around the classification of Polyvinyl Acetate Emulsion. The appellants assert that it should be classified under Heading 39.05, while the Revenue argues that it belongs under Heading 35.06. Both parties rely on Board's Circular No. 47/90 dated 31-8-1990, which addresses the classification issue of Polyvinyl Acetate. The Circular clarifies that the presence of additives in the emulsion, such as protective colloid, initiator, surfactant, and buffers, can lead to confusion as to whether it should be classified as prepared glues and adhesives falling under chapter 35. However, the Circular distinguishes between polymers with adhesive properties and those specially formulated for use as glues or adhesives, emphasizing the exclusion clause under the General Explanatory Notes of Chapter 39. The Chief Chemist's opinion also states that Polyvinyl Acetate Emulsion with additives and inherent adhesive properties should be classified under Heading 39.05 unless its usage and mode of presentation for sale meet the criteria for classification under Heading 35.06.

The Tribunal notes that both parties agree on the legal position based on the Circular, indicating that if retail packs are not more than 1 kg, they should be classified under Heading 35. However, if the retail packs exceed 1 kg, they should fall under Heading 39. The Tribunal observes that the information provided in the impugned orders is insufficient to determine whether the retail pack weight exceeds 1 kg or if multiple 1 kg packs are combined in a single carton. Therefore, to clarify the facts, the Tribunal sets aside the impugned order and remands the matter to the original Adjudicating Authority for a fresh decision in line with the Circular, after verifying the actual weight of the retail packs.

Additionally, the Tribunal grants the request of the respondents' advocate to keep all other issues open for the original Adjudicating Authority to decide. Consequently, the Revenue's appeals are allowed by way of remand, and the case is pronounced in court for further proceedings.