1996 (4) TMI 321 - AT - Central Excise

Summary

Issues:
Interpretation of duty chargeable on Viscose Tow based on weight and moisture content; Request for concession in duty payment based on commercial weight calculation; Authority's power to grant concessions under the Central Excise Tariff Act, 1985.

Detailed Analysis:

The case involves a dispute regarding the duty chargeable on Viscose Tow manufactured by the appellants, falling under Chapter heading 5502.00 of the Central Excise Tariff. The appellants argue that the duty should be calculated on the commercial weight, which includes the weight at the ovendry stage plus a conventional allowance of 13 percent for moisture content. They claim that this method is in line with international standards set by BISFA and is followed in India. Additionally, they highlight the special industrial use of Viscose Tow in making Flocked Fabrics, where a higher moisture content is necessary to prevent filament entanglement. The appellants seek permission to pay duty based on the commercial weight, which would have a moisture content of 45 to 60 percent.

The jurisdictional Assistant Collector and the Collector (Appeal) rejected the appellants' request, stating that duty is chargeable based on the weight at the time of removal from the factory, without allowing deductions for excess moisture content. The appellants' consultant referred to international standards and examples where customs duty was not charged on moisture content exceeding 130 percent, arguing for a similar concession in this case. However, the Departmental Representative contended that the Tariff Act mandates duty calculation based on the actual weight of the item without separate criteria for moisture content.

The central issue revolves around the authority's power to grant concessions in duty payment. The tribunal notes that the Central Excise Tariff Act, 1985, and related acts do not provide for such concessions as sought by the appellants. While acknowledging the strength of the appellants' case, the tribunal concludes that only the Government of India, and not the Excise Authorities, can grant the type of concession requested. The tribunal emphasizes that the Tariff Heading 5502.00 specifies duty calculation based on the actual weight of the item manufactured, without provisions for alternative weight calculations.

Moreover, the tribunal dismisses the applicability of the Board's letter on denierage to Viscose Tow, as it falls under a different chapter and pertains to yarn fineness, not excisable weight. The tribunal highlights that the criteria of commercial weight, if intended to be incorporated, would require specific directions from the government, similar to those issued for denierage. The tribunal also rejects the appellants' reliance on alleged acceptance of commercial weight criteria by Customs Authorities, emphasizing the lack of conclusive proof for applying the same criteria to Excise Duty calculations.

In conclusion, the tribunal finds no grounds for interference with the authorities' decision and rejects the appeal, emphasizing that the duty on Viscose Tow must be calculated based on the actual weight as per the Tariff Heading 5502.00, without concessions for moisture content or commercial weight calculations.