2010 (9) TMI 500 - AT - Central Excise

Classification - The samples of the product in question were sent for chemical examination twice and as per the second test report of the Chemical Examiner, the product in question consisted of silicone polymer in primary form - in the present case the test report which is in respect of the product in question, specifically mentioned that the product contained silicone polymer in primary form - Tribunal in the earlier decisions relied upon by the Revenue held that the mould release compound preparation is classifiable under Chapter 39 of Tariff - The product is classifiable under Chapter 39 of the Central Excise Tariff. Regarding penalty - the issue is in respect of classification of goods and the samples were sent twice to the Chemical Examiner for testing, it is not a case for imposition of penalty - Accordingly decided in the favour of the revenue

Summary

Issues: Classification of products 'paper release compound high release' and 'mould release preparation heavy duty' under Chapter 39 of the Central Excise Tariff instead of Chapter 34 as requested by the appellant.

Analysis:
1. Classification Dispute: The appellant appealed against the order reclassifying the products under Chapter 39 instead of Chapter 34 as desired. The products were found to contain silicone polymer in primary form, leading to the Revenue's argument based on Chapter Note 6 to Chapter 39 that covers various forms including liquids, pastes, powders, and granules. Previous Tribunal decisions supported this classification, emphasizing the primary form of the products.

2. Chemical Examination: The product in question was tested twice, with the second test report confirming the presence of silicone polymer in primary form. The appellant contended that the product's composition, including silicon oil, water, emulsifier, and toluene, did not align with silicone in primary form. However, the Chemical Examiner's report and past Tribunal decisions supported the classification under Chapter 39 due to the presence of silicone polymer in primary form.

3. Judgment and Penalty: The Tribunal upheld the impugned order, citing the Chemical Examiner's opinion and past decisions, concluding that the products are classifiable under Chapter 39 of the Central Excise Tariff. Regarding the penalty, since the issue revolved around classification and multiple tests were conducted, the Tribunal deemed it inappropriate to impose a penalty. Consequently, the classification under Chapter 39 was affirmed, and the penalty on the appellant was set aside, leading to the disposal of the appeal accordingly.

This detailed analysis highlights the key arguments, evidence, legal interpretations, and the final decision made by the Appellate Tribunal CESTAT, Mumbai regarding the classification dispute and penalty imposition in the mentioned case.