1988 (2) TMI 216 - AT - Central Excise

Summary

Issues:
- Appeal against Order-in-Appeal allowing appeal on merits and limitation
- Classification of masticated rubber under Central Excise Act
- Comparison with previous Tribunal and High Court decisions
- Interpretation of mastication process as manufacturing under Central Excise Act
- Rejection of Collector's contentions

Analysis:
The judgment involves an appeal filed by the Collector of Central Excise, Cochin, challenging Order-in-Appeal No. 102/83(c) allowing an appeal by M/s. Ceakay Rubber Industries on the classification of masticated rubber under the Central Excises and Salt Act, 1944. The Collector disputed the findings on both the limitation issue and the merits of the dispute regarding the excisability of masticated rubber. The Collector contended that masticated rubber was a different product from natural rubber and should be excisable under the Act.

The Tribunal considered two previous decisions on the excisability of masticated rubber, one by the Tribunal itself and the other by the Kerala High Court. The Tribunal noted that the High Court held that masticated rubber did not change its character from natural rubber through the mastication process and, therefore, was not excisable under the Act. The Tribunal also reviewed the definition of mastication from the ISI Glossary, emphasizing that mastication only lowered the plasticity of rubber without creating a new product. The Tribunal rejected the Collector's argument that mastication amounted to a manufacturing process based on the Kerala High Court's judgment.

The Tribunal further analyzed the S.D.R.'s reliance on a book regarding mastication, concluding that the process did not result in a new product with different characteristics or uses. Ultimately, the Tribunal held that masticated rubber, produced by the respondents through mastication of natural rubber without adding chemicals, did not constitute manufacturing under the Central Excises and Salt Act. Therefore, the masticated rubber was not excisable under the Central Excise Tariff Schedule, aligning with the Kerala High Court's judgment and rejecting the Collector's contentions.

In light of the conclusion that masticated rubber was not excisable under the Act, the Tribunal found it unnecessary to address the aspect of limitation raised in the appeal. Consequently, the Tribunal dismissed the appeal filed by the Collector of Central Excise, Cochin, upholding the Order-in-Appeal allowing the appeal by M/s. Ceakay Rubber Industries on the classification of masticated rubber.