2013 (5) TMI 209 - AT - Central Excise

Manufacture - whether activity of conversion of bitumen into Polymer Modified Bitumen and cleared under the sealoflex amounts to manufacture and could be classified as bitumen mixture under Tariff Sub-heading 2715 00 90. - Held that - No, following the decision of the Hon ble Supreme Court in the case of Osnar Chemical 2012 (1) TMI -27 , the impugned order is set aside and the appeal is allowed with consequential relief, if any.

Summary

Issues: Classification of Polymer Modified Bitumen (PMB) under Tariff Sub-heading 2715 00 90

Issue 1: Classification of PMB under Tariff Sub-heading 2715 00 90
The judgment revolves around determining whether the conversion of bitumen into Polymer Modified Bitumen (PMB) and cleared under the brand name sealoflex amounts to manufacture and could be classified as bitumen mixture under Tariff Sub-heading 2715 00 90. The appellant argued that the process undertaken does not amount to manufacture based on a decision of the Hon'ble Supreme Court in a similar case. The learned counsel emphasized that the process only improves the quality of bitumen without changing its identity. The technical report from IIT, Madras was presented to support this argument. The Hon'ble Supreme Court's decision in the case of Osnar Chemical was cited, where it was held that the process of mixing polymers and additives with bitumen does not amount to manufacture. The Court emphasized that the end use and characteristics of bitumen remained the same even after the process. The Tribunal's decision in another case related to improving the quality of bitumen was also referenced to support the classification of PMB under a different tariff heading, i.e., 2713 20 00. Consequently, the Tribunal dismissed the appeals and allowed the classification under 2713 20 00 based on the Supreme Court's decision in Osnar Chemical.

Issue 2: Implications of Supreme Court's Decision and Tribunal's Findings
The judgment extensively relies on the decision of the Hon'ble Supreme Court in the case of Osnar Chemical to establish that the process of converting bitumen into PMB does not amount to manufacture. The Court emphasized that there was no transformation of bitumen into a new product with different characteristics or identity. The judgment further highlighted that the process only improved the quality of bitumen without changing its essential nature. Additionally, the Tribunal's decision in another case was cited to support the classification of PMB under a specific tariff heading. The judgment concluded that PMB or CRMB cannot be treated as bituminous mixtures under a particular tariff heading and should be classified differently based on the Supreme Court's decision and the Tribunal's findings.

Issue 3: Dismissal of Appeals and Consequential Relief
In light of the opinion expressed based on the Supreme Court's decision and the Tribunal's findings, the appeals were dismissed as they lacked merit. The judgment highlighted that there was no ground for interference with the impugned orders passed by the Tribunal. Consequently, the appeals were dismissed with no order as to costs. The judgment also set aside the impugned order proposing classification under a specific tariff heading and allowed the appeal with consequential relief, if any. The stay application was disposed of accordingly, aligning with the decision on the classification of PMB under a different tariff heading as per the Supreme Court's precedent.

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