1988 (1) TMI 54 - AT - Customs

Summary

Issues: Classification of Silicone Oil for Customs Duty Assessment

Issue 1: Classification under Chapter 39 vs. Chapter 34
The case involved two orders-in-appeal passed by the Collector of Customs (Appeals), Bombay, regarding the assessment of Silicone Oil imported by M/s. CEAT Tyres. The dispute centered around whether the Silicone Oil should be classified under Chapter 39 (synthetic polymers) or Chapter 34 (lubricating preparations).

Analysis:
The counsel for M/s. CEAT Tyres argued that the Silicone Oil, used as a mould release agent in tyre manufacturing, should not be assessed under Chapter 39 as it lacks resinous or plastic nature. They contended that the oil should be classified under Chapter 34, specifically as a lubricating preparation. However, the department's counsel maintained that silicone oil should be assessed where listed by name, which is under Chapter 39, alongside products with similar characteristics.

Issue 2: Interpretation of Customs Tariff Headings
The crux of the matter was the interpretation of various customs tariff headings, specifically whether Silicone Oil falls under the definition of synthetic polymers in Chapter 39 or as a lubricating preparation in Chapter 34.

Analysis:
The Tribunal examined the scientific and technological aspects of Silicone Oil, emphasizing that it is a polymerisation product produced by chemical synthesis, meeting the criteria of Chapter 39. The classification under Chapter 39 was supported by references to the CCCN and the Harmonised System headings, which clearly distinguish primary silicone products from lubricating preparations containing silicone.

Issue 3: Expert Opinions and Authorities
The Tribunal considered expert opinions and authoritative sources, such as the CCCN, Harmonised Code, and Encyclopaedia of Polymer Science and Technology, to determine the classification of Silicone Oil. These sources affirmed that Silicone Oil, despite its use as a lubricant, should be classified under Chapter 39 as a silicone in its primary form.

Analysis:
The Tribunal highlighted that the CCCN and Harmonised System headings classified oils and greases as primary forms of silicones, supporting the classification of Silicone Oil under Chapter 39. The Encyclopaedia of Polymer Science and Technology further clarified that Silicone Oil is distinct from silicone resins, reinforcing its classification as a silicone product.

Conclusion:
The Tribunal unanimously ruled that the Silicone Oil imported by M/s. CEAT Tyres should be classified under Chapter 39 as silicones. The decision was based on the scientific nature of Silicone Oil as a polymerisation product and its listing under Chapter 39 tariff headings. The judgment emphasized the importance of accurate classification in customs assessment and the need to adhere to established definitions and criteria.