2001 (9) TMI 127 - AT - Central Excise

Summary

Issues Involved:
1. Classification of articles of Glass Fibre Reinforced Plastics (GFRP) under Central Excise Tariff Act (CETA).
2. Applicability of Heading 70.14 versus various sub-headings of Chapter 39 of CETA.
3. Relevance of Harmonized System of Nomenclature (HSN) Explanatory Notes in classification.
4. Interpretation of the term "impregnated" in the context of Heading 70.14.
5. Essential character of the product and its impact on classification.
6. Binding nature of Board's Circulars on departmental officers.

Detailed Analysis:

1. Classification of Articles of Glass Fibre Reinforced Plastics (GFRP):
The primary issue is whether the products manufactured by the appellants, such as Roofing sheets, Panels, Doors, and Domes, made from Glass Fibre Reinforced Plastics (GFRP), should be classified under Heading 70.14 or various sub-headings of Chapter 39 of the Central Excise Tariff Act (CETA).

2. Applicability of Heading 70.14 versus Chapter 39 of CETA:
The appellants argued that their products should be classified under Heading 70.14, which covers "Glass fibres (including glass wool and glass filaments) and articles thereof whether or not impregnated, coated, covered or laminated with plastics or varnish." They contended that their products are articles of glass fibre impregnated with plastic. However, the Revenue classified them under various sub-headings of Chapter 39, arguing that the products are primarily plastic materials reinforced with glass fibre.

3. Relevance of HSN Explanatory Notes:
The appellants argued that HSN Explanatory Notes should not be applied as Heading 70.14 in the Central Excise Tariff differs from Heading 70.19 in the HSN. They emphasized that the Central Excise Tariff explicitly includes articles impregnated with plastics, unlike the HSN. The Tribunal, however, found that the impugned products are not articles of glass fibre impregnated with plastics but are instead composite materials where glass fibre is used as reinforcement in plastic matrices.

4. Interpretation of "Impregnated":
The appellants claimed that their manufacturing process involves impregnating glass fibre with plastic, fitting the description under Heading 70.14. The Tribunal noted that the manufacturing process described by the appellants involves using glass fibre mat as a raw material, which is then combined with resin and other materials to form the final product. This process does not align with the notion of impregnating a pre-existing glass article with plastic.

5. Essential Character of the Product:
The Tribunal considered the essential character of the products, noting that they are known as Fibre Glass Reinforced Plastics (FRP) in the market. Technical literature supported that these products are primarily plastic materials reinforced with glass fibre, which enhances their physical properties. The Tribunal concluded that the products acquire the character of plastics and should be classified under Chapter 39, aligning with the Explanatory Notes of HSN.

6. Binding Nature of Board's Circulars:
The appellants referenced various Board's Circulars and Trade Notices that classified similar products under Heading 70.14. They argued that these circulars are binding on departmental officers. However, the Tribunal emphasized that the classification must be based on the product's nature and manufacturing process, which in this case, aligns more closely with Chapter 39.

Conclusion:
The Tribunal held that the impugned products are classifiable under Chapter 39 of the Central Excise Tariff. It was concluded that the products are not merely articles of glass fibre impregnated with plastics but are composite materials where glass fibre acts as reinforcement in a plastic matrix. Consequently, the appeal was rejected, affirming the classification under Chapter 39.