2005 (2) TMI 199 - AT - Central Excise

Summary

Issues:
1. Classification of the product 'Bitufelt Type III Grade I' under Chapter Heading 68.07 or Chapter Heading 59.09.
2. Whether the process of making blown grade bitumen amounts to manufacture.

Analysis:
1. The first issue involves the classification of the product 'Bitufelt Type III Grade I' under Chapter Heading 68.07 or Chapter Heading 59.09. The dispute arose when the Commissioner of Central Excise, Mumbai confirmed a duty demand against the appellant company under Chapter Heading 68.07, rejecting their claim for classification under Chapter Heading 59.09. The Tribunal referred to a previous decision where it was held that Bituminised hessian-based felt is not covered under Chapter Heading 68.07 but under Chapter Heading 59.09. The product in question, a bituminous coated/covered hessian fabric, was found to be correctly classified under Chapter Heading 59.09. The benefit of Notifications was denied based on the incorrect classification, which was rectified by the Tribunal. Thus, the product falls under Chapter Heading 59.09, and the benefit of Notification No. 53/65-C.E., dated 20-3-1965 is applicable.

2. The second issue involves determining whether the process of making blown grade bitumen out of straight grade bitumen amounts to manufacture. This issue has been settled in favor of the assessees by previous Tribunal decisions. The Tribunal cited cases where it was established that the process of making blown grade bitumen does amount to manufacture. Therefore, the Tribunal upheld that the said process does constitute manufacturing activity.

In conclusion, the Tribunal set aside the impugned order and allowed the appeals based on the correct classification of the product and the established manufacturing process. The Tribunal did not address the argument regarding the limitation period for the demand since the appeals were allowed on their merits.