1988 (10) TMI 149 - AT - Central Excise

Summary

Issues: Classification of Methyl Cellulose under the Customs Tariff Act, 1975

1. Classification under Chapter 39:
The appellants argued that Methyl Cellulose should be classified under Chapter 29, contending that Chapter 39 covers only products with plasticity characteristics, which Methyl Cellulose lacks. They also highlighted the varying grades of Methyl Cellulose and its use as a pharmaceutical chemical. However, the respondent asserted that Methyl Cellulose, being a chemical derivative of cellulose, falls under Chapter 39, citing a relevant tribunal order.

2. Interpretation of Chapter Notes:
The discussion revolved around Chapter Note 1(a) of Chapter 29, which applies to separate chemically defined organic compounds. The appellants contended that Methyl Cellulose should be classified under Chapter 29 due to its varying molecular weights. Conversely, the tribunal noted that Methyl Cellulose, as a cellulose ether, falls under Heading 39.01/06, despite the arguments based on Chapter Note 2 of Chapter 39.

3. Application of Chapter Notes and Technical Literature:
The tribunal referred to technical literature stating that Methyl Cellulose is a chemical derivative of cellulose with varying molecular weights. It emphasized that Methyl Cellulose's use in the pharmaceutical industry does not alter its classification under Chapter 39 due to Chapter Note 1(a). Additionally, the tribunal clarified that Chapter Note 2 of Chapter 39 does not exclude cellulose ethers and chemical cellulose derivatives from the chapter.

4. Rejection of Classification under Chapter 29:
The appellants' reliance on Chapter 29 for classifying Methyl Cellulose was deemed misconceived, as the dictionary definition of "isomer" did not apply to Methyl Cellulose with varying molecular weights. The tribunal concluded that the lower authorities correctly classified Methyl Cellulose under Heading No. 39.01/06, leading to the dismissal of the appeal.

In conclusion, the judgment upheld the classification of Methyl Cellulose under Chapter 39 of the Customs Tariff Act, 1975, rejecting the appellants' arguments based on plasticity characteristics and varying molecular weights. The tribunal's analysis of relevant chapter notes and technical literature supported the classification of Methyl Cellulose as a chemical derivative of cellulose falling under Heading 39.01/06, emphasizing the specific inclusion of cellulose ethers within this category.