1981 (9) TMI 110 - HC - Central Excise

Summary

Issues:
Determining whether corrugated roofings manufactured by petitioners are considered a 'sheet' and thus not eligible for exemption under Notification No. 68 of 1971.

Analysis:
The petitioners, a partnership firm in Bombay, sought clarification from the Central Excise Department regarding the excisability of their intended product, corrugated roofings. The Superintendent initially deemed the product as not eligible for exemption under Notification No. 68 of 1971, citing that the fibre glass corrugated roofings are sheets and attract duty under Item 15A(2) of the Central Excise Tariff. The Assistant Collector, after a hearing, concluded that the product falls under Tariff item 15A(2) and is exempted under Notification No. 68/71. The Appellate Collector upheld this decision, emphasizing the direct molding process from resins. However, the Central Government, through a show cause notice, reviewed and set aside the Appellate Collector's order, asserting that the product is indeed a sheet and not exempt from duty.

Shri Korade, representing the petitioners, raised several arguments challenging the Central Government's decision. He contended that the term "sheet" in Item 15A(2) should not be limited to flat articles, as the legislative intent was to include all plastic articles of various shapes. Additionally, he argued that the exemption notification excludes only flat plastic articles like sheets, boards, and films, implying that non-flat sheets are not exempt. However, the Court rejected these arguments, emphasizing the broad interpretation of the term "sheet" to encompass various shapes, including corrugated roofings.

Shri Korade further argued that since the corrugated roofings were reinforced with fiberglass, they should not be considered purely plastic articles. The Court dismissed this argument, citing industry references and materials indicating that fiberglass-reinforced plastic remains a plastic article for excise purposes. The Court also noted that the petitioners failed to provide contrary evidence regarding the commercial understanding of corrugated roofings as plastic sheets, as required by law.

In conclusion, the Court upheld the Central Government's decision, finding it consistent with the Central Excise Tariff and exemption notification. The petition was dismissed, with costs awarded to the respondent. The Court clarified that the issue of the show cause notice's legality in terms of limitation could be raised by the petitioners before the relevant authorities.