1990 (7) TMI 213 - AT - Central Excise

Summary

Issues: Classification of the product "Rustodine" and eligibility for duty exemption under Notification 101/66 dated 17-6-1966.

In this judgment by the Appellate Tribunal CEGAT, New Delhi, the primary issues revolved around the classification of the product "Rustodine" and its eligibility for exemption from duty under Notification 101/66. The respondents manufactured Rustodine, a pre-treatment chemical, and the Department sought to classify it under T.I. 68 as predominantly inorganic, while the respondents claimed classification under T.I. 15AA and eligibility for exemption. The Collector of Central Excise upheld the respondents' classification, leading to the appeal.

The Department contended that Rustodine was predominantly inorganic based on reports and technical literature, arguing it was not a surface active agent but a chemical reacting product. They also raised the issue of misdeclaration by the assessee. However, the test report revealed Rustodine's composition of phosphoric acid, organic compounds, water, and solvents, with surface active properties, making it eligible for duty exemption under Notification 208/69. The Tribunal found the product fell under T.I. 15AA, covering organic surface active agents, and was entitled to benefits under Notification 101/66 for containing less than 5% of the principal active ingredients.

The Tribunal, having ruled in favor of the respondents on the classification and exemption eligibility, did not delve into the limitation aspect raised by the Department. Ultimately, the Tribunal classified Rustodine under T.I. 15AA and deemed it eligible for benefits under Notification Nos. 101/66 and 208/69, upholding the adjudicating authority's decision and dismissing the appeal.