1997 (12) TMI 229 - AT - Central Excise

Summary

Issues:
Classification of Pitch-Creosote Mixture (P.C.M.) under Tariff Headings 27.06 and 27.08, Benefit of Notifications 121/62 and 75/84, Interpretation of blending under Tariff Heading 2708.11.

Analysis:
The judgment revolves around the classification of Pitch-Creosote Mixture (P.C.M.) under the Tariff Headings 27.06 and 27.08. The Assistant Commissioner found that P.C.M. is only a partially distilled tar and not 100% tar. The appellants failed to provide evidence that P.C.M. and tar are known as the same product in common parlance. Consequently, the Assistant Commissioner denied the benefit of Notifications 121/62 and 75/84, holding P.C.M. chargeable to basic duty plus a special excise duty.

Another issue addressed in the judgment pertains to the classification of P.C.M. under the new Tariff. The Assistant Commissioner, upheld by the Commissioner (Appeals), classified the product under sub-heading 2708.11 instead of 2706.00 as claimed by the appellants. This decision was consistent with the finding that P.C.M. is a partially distilled tar.

Furthermore, a group of appeals relating to subsequent periods and duty demands involved a similar classification dispute. The predecessor Assistant Commissioner determined the classification under sub-heading 2708.11, aligning with the classification in the previous appeal.

To understand the controversy, the judgment reproduced the Tariff Headings 27.06 and 27.08. It was noted that Heading 27.06 covers partially distilled tar, which corresponds to the nature of P.C.M. as established by the Assistant Commissioner. Therefore, the product falls under Tariff sub-heading 2706.00 based on a plain reading of the Tariff.

The Respondent argued that P.C.M. should be classified under Tariff sub-heading 2708.11 due to its composition predominantly being pitch blended with Creosote Oil. However, the Tribunal rejected this argument, emphasizing that the blending under Tariff Heading 2708.11 requires the existence of pitch and another product blended together, which was not the case with P.C.M. since it resulted from partial distillation of tar.

Ultimately, the Tribunal held that P.C.M. falls under Tariff Heading 2706.00, leading to a nil rate of duty. Consequently, the question of benefiting from the disputed Notifications did not arise. The appeals were allowed in favor of the appellants, granting them consequential reliefs.