1987 (2) TMI 218 - AT - Customs

Summary

Issues Involved:
1. Eligibility for concessional rate of duty under Notification No. 173-Cus/77 and Notification No. 67-Cus/79.
2. Classification of imported aluminium foil products.
3. Interpretation of the percentage of aluminium content in composite products.

Detailed Analysis:

1. Eligibility for Concessional Rate of Duty under Notification No. 173-Cus/77 and Notification No. 67-Cus/79:

The appellants imported two varieties of aluminium foil and claimed a refund of part of the duty paid, seeking the benefit of Notification No. 173-Cus/77 and Notification No. 67-Cus/79. The Assistant Collector rejected the claim, stating that the notifications apply only to plain aluminium foil, whereas the imported goods were coated and laminated. The Appellate Collector upheld this decision, noting that the imported goods contained only 60-65% aluminium, which is less than the stipulated 97% required by the notification.

The Tribunal examined the arguments and the notifications in question. Notification No. 173/77 exempts aluminium manufactures containing more than 97% aluminium from excess duty. Notification No. 67/79 applies to plain aluminium foil of a specific thickness, containing more than 97% aluminium. The Tribunal concluded that both notifications refer to the aluminium content of the entire product, not just the aluminium part of the composite product. Since the imported goods were composite products with less than 97% aluminium content, they did not qualify for the concessional rate of duty under either notification.

2. Classification of Imported Aluminium Foil Products:

The appellants argued that the imported goods were classified as "foils of unalloyed aluminium" under H. 76.03/04(2) and should be considered as such for the purpose of the notifications. The Tribunal, however, found that the imported goods were composite products, as the aluminium foil was laminated to paper and heat-seal coated, making them inseparable without damaging the product. Therefore, the classification of the goods for the purpose of the notifications should consider the entire composite product, not just the aluminium content.

3. Interpretation of the Percentage of Aluminium Content in Composite Products:

The appellants contended that the 97% aluminium content referred to the aluminium part of the foil, not the entire product. They argued that the essential character of the goods was given by the aluminium foil, and thus the percentage should be calculated based on the aluminium part alone. The Tribunal rejected this argument, stating that the notifications clearly refer to the aluminium content of the entire product. The Tribunal also noted that the imported goods were composite products, and the percentage of aluminium was less than 97% when considering the total weight of the product.

Conclusion:

The Tribunal dismissed the appeal, concluding that the imported aluminium foil products did not qualify for the concessional rate of duty under Notification No. 173-Cus/77 and Notification No. 67-Cus/79. The goods were correctly classified as composite products, and the aluminium content was less than the required 97% for the notifications. The appeal was thus rejected, and the original assessment was upheld.