1982 (2) TMI 313 - Board - Central Excise

Summary

Issues:
- Appeal against Central Excise duty order
- Classification of varnished cloth under Central Excise Tariff
- Distinction between varnished cloth and plastic materials

Analysis:
The appeal was filed by a Plastic Processing Company against an order passed by the Collector of Central Excise Calcutta, directing the payment of Central Excise duty amounting to a specific sum under rule 9(2) of the Central Excise Rules, 1944. A personal hearing was granted to the appellants by the Board, during which the Advocate representing the company submitted various documents and samples to support their case. The Advocate argued that the varnished cloth manufactured by the company is distinct from plastic materials covered under the Central Excise Tariff. The Board carefully considered the submissions and observed that the varnish used by the company, although containing synthetic resin, differs from plastic materials as described in the tariff.

The Board noted that the varnish used by the company, falling under a specific item in the Central Excise Tariff, cannot be classified as a preparation of cellulose derivatives or other artificial plastic materials. Additionally, the Board agreed with the appellant's contention that varnished cloth is different from cotton fabric impregnated, coated, or laminated with cellulose derivatives or plastic materials. The Board recognized varnished cloth as a separate class of fabric with distinct use and appearance compared to normal coated cotton fabrics. Referring to a specific standard, the Board highlighted the description of "yellow varnished cloth" as manufactured with a clean insulating varnish consisting of a drying oil and resin.

It was clarified that the classification of materials received by the appellant from others was not the subject of consideration in this case. The Board also acknowledged that a type of varnish is formed before being used to coat cotton fabric, emphasizing that the question of its dutiability was not under consideration. Consequently, the Board allowed the appeal and overturned the Collector's order, ruling in favor of the Plastic Processing Company.