1983 (12) TMI 182 - AT - Central Excise

Summary

Issues:
Whether the product "ALKYLATED PHENOL" (BUTYLATED HYDROXY TOLUENE - BHT) imported by the appellants was liable to be charged to additional duty of Customs under Item 65 of the Central Excise Tariff Schedule (CET) as a rubber processing chemical.

Analysis:
The appeal was initially filed as a Revision Application before the Central Government and was transferred to the Tribunal for disposal as an appeal. The main issue revolved around the classification of the product "ALKYLATED PHENOL" (BHT) imported by the appellants and whether it should be charged with additional duty under Item 65 of the CET as a rubber processing chemical.

The Customs authorities initially released the goods without levying countervailing duty. However, later on, countervailing duty was demanded from the appellants based on the excise duty under Item 65 CET. The appellants contended that the product was not used as an antioxidant for rubber but as an additive for lubricating oil, even though it could be used as an antioxidant in the rubber industry.

During the hearing, the appellants cited previous Tribunal orders related to the classification of the same product, Butylated Hydroxy Toluene (BHT), and argued that the onus to prove the product was predominantly used as a rubber processing chemical was on the Department, which they failed to do. The Department argued against the relevance of past decisions in tax matters and emphasized the end-use criterion and technical opinion by the Director-General of Technical Development (DGTD) supporting the product's classification as a rubber oxidant.

The Tribunal considered both sides' submissions and agreed with the appellants that the DGTD's opinion was not directly relevant to the specific product in question. They also noted that while there is no res judicata in tax matters, the previous Tribunal decision extensively discussed the classification of Butylated Hydroxy Toluene under Item 65 CET, and there was no reason to differ from that decision.

In conclusion, the Tribunal allowed the appeal, directing the Customs authorities to grant consequential relief to the appellants within three months from the date of the order's communication.