1998 (8) TMI 200 - AT - Central Excise

Summary

Issues: Classification of Winall Glue, Sensitizer Winall, Sensitizer (G & W), and Stensil Remover under the Central Excise Tariff Act.

Classification of Winall Glue:
The appeal addressed the classification of Winall Glue under Heading 35.06 or sub-heading 3905.20 of the Central Excise Tariff Act. The Commissioner (Appeals) classified it under Heading 35.06, considering it a prepared glue, while the Revenue argued for classification under sub-heading 3905.20 as a polymer of vinyl. The Tribunal noted that Winall Glue falls under the category of prepared glues, as per Heading 35.06, and ruled that the most specific description should be preferred over a more general one, as per Rule 3(a) for interpretation of the Schedule. The Tribunal found Winall Glue to be specifically formulated for use as an adhesive, hence classifying it under Heading 35.06.

Classification of Sensitizer Winall and Sensitizer (G & W):
The issue revolved around the dutiability of Sensitizer Winall and Sensitizer (G & W) obtained by diluting Ammonium Bichromate. The Commissioner (Appeals) held these products as non-dutiable, emphasizing that no new chemical properties emerged from the dilution process. The Revenue argued that the addition of water led to the creation of distinct products with different names, indicating a chemical reaction. However, the Tribunal concurred with the Commissioner's findings, stating that no new product emerged from the dilution process, as clarified by the Supreme Court's definition of "manufacture" as bringing into existence a new substance with distinctive characteristics.

Classification of Stensil Remover:
Regarding the product Stensil Remover, the dispute centered on its classification under the Central Excise Tariff Act. The Commissioner (Appeals) deemed it non-dutiable, stating that mere dilution with water did not constitute manufacturing. The Revenue contended that the addition of water to phosphoric acid resulted in a new product with a distinct classification under Heading 38.23. The Tribunal agreed with the Revenue, acknowledging that a new commodity with unique characteristics emerged from the addition of water, thus meeting the definition of manufacture under Section 2(f) of the Central Excise Act.

In conclusion, the Tribunal upheld the classification of Winall Glue under Heading 35.06, affirmed the non-dutiable status of Sensitizer Winall and Sensitizer (G & W) due to the lack of new products resulting from dilution, and classified Stensil Remover under Heading 38.23, recognizing the emergence of a new product after the addition of water to phosphoric acid.