2005 (2) TMI 128 - SC - Central Excise

Tarpaulin cloth/wax - whether the article manufactured by the respondent-assessee is classifiable under Tariff Heading 59.06 which is the contention of the appellant or Tariff Heading 52.06 which is the contention of the respondent-assessee - Held that - The Tribunal took note of the fact that the Collector had the article chemically analysed. The Chemical analyst s report showed that the material was impregnated by waterproofing material. Subsequently a retest was done by the Chief Chemist of the Central Revenues Control Laboratory, Government of India which showed that the three samples were not wholly impregnated and on the other hand the warp and weft of the cloth could be seen by the naked eye. The Tribunal, therefore, came to the conclusion that this situation was covered by Chapter Note 5(a) and therefore, taken out of the purview of Tariff Heading 59.06. The finding being one of fact, we do not see any reason to interfere with the conclusion of the Tribunal - Decided against Revenue.

Summary

Issues:
1. Classification of the article manufactured by the respondent-assessee under Tariff Heading 59.06 or 52.06.

Analysis:
The dispute in the case revolved around the classification of the article manufactured by the respondent-assessee under either Tariff Heading 59.06, as contended by the appellant, or Tariff Heading 52.06, as contended by the respondent-assessee. The Tribunal examined the manufacturing process, which involved dipping cotton cloth in a mixture of wax, china clay, and yellow chlorine, passing it through rollers, squeezing it to the required thickness, drying it, and cutting it to the required sizes. The Tribunal found that the fabric could not be considered impregnated based on the definition of "impregnated" in the Handbook on Glossary of Textile Terms. Additionally, a Circular issued by the Central Board of Excise and Customs stated that for the purposes of Tariff Heading 59.06, the manufacturing process and waterproofing must result in a visible layer on the fabric's surface.

The Tribunal considered a chemical analysis of the material, which initially indicated impregnation by waterproofing material. However, a retest conducted by the Chief Chemist of the Central Revenues Control Laboratory revealed that the samples were not wholly impregnated, and the warp and weft of the cloth were visible to the naked eye. Consequently, the Tribunal applied Chapter Note 5(a), concluding that the fabric was taken out of the purview of Tariff Heading 59.06. As the Tribunal's finding was based on factual analysis, the Supreme Court saw no reason to interfere with the conclusion and dismissed the appeals without any order as to costs.

In a separate set of civil appeals (C.A. Nos. 280-292/2002), the Supreme Court, after considering the facts of the case, decided not to interfere with the Tribunal's decision. Therefore, the civil appeals were also dismissed without any order as to costs.