Central Excise - Classification and dutiability of composite articles of plastics and polyurethane foam arising in the course of manufacture of composite articles of plastics - Regarding - Central Excise - 16/88-CX.3

Central Excise - Classification and dutiability of composite articles of plastics and polyurethane foam arising in the course of manufacture of composite articles of plastics - Regarding Circular No. 16/88-CX.3 Dated 10-8-1988 [From F. No. 93/23/87-CX.3] Government of India Ministry of Finance (Department of Revenue) New Delhi Subject: Central Excise - Classification and dutiability of composite articles of plastics and polyurethane foam arising in the course of manufacture of composite articles of plastics - Regarding. Certain doubts had been raised as to whether composite articles of plastics made out of a combination of plastic and non-plastic materials should be treated as 'articles of plastics' of Chapter 39 of the Schedule to the Central Excise Tariff Act, 1985, and whether such articles would be entitled to the exemption, as per Sr. No. 38 of notification No. 132/86-C.E., dated 1-3-1986, as amended, during the period prior to 1-3-1988 and Sr. No. 39 of notification No. 53/88-C.E., dated 1-3-1988 from 1-3-1988. Doubts had also been raised regarding classification of polyurethane foam arising during the course of manufacture of such composite articles of plastics by in situ process and its dutiability. 2. The above mentioned issues have been examined by the Board. As regards the classification of composite articles of plastics made out of combination of plastic and non-plastic materials, the Board is of the view that the classification of such goods as 'articles of plastics' of Chapter 39 of the Schedule to the Central Excise Tariff Act, 1985 would depend on the predominancy of weight and value of the component materials which have gone into the manufacture of such composite articles of plastics, keeping in view the Rules of Interpretations to the Schedule to the Central Excise Tariff Act, 1985. While deciding the classification of such products, due regard should given to the trade identity of the product, i.e. how the same is known in the commercial/trade parlance. It is viewed that once a product made out of a combination of plastic and non-plastic materials has been classified as an article of plastics under sub-heading No. 3922.90 from 1-3-1986 to 9-2-1987, under sub-heading No. 3922.00, 3923.90, 3924.90, 3925.90 or 3926.90 from 10-2-1987 to 29-2-1988 and under heading number 39.23, 39.24 or 39.26 (other than of polyurethane foam) from 1-3-1988 onwards on the basis of the above guidelines, the benefit of exemption as per Sr. No. 38 of notification No. 132/86-C.E., dated 1-3-1986, as amended, prior to 1-3-1988 and Sr. No. 39 of Notification No. 53/88-C.E., dated 1-3-1988 from 1-3-1988 would be available to such articles of plastics in view of the fact that the notification in question does not use the expressions 'exclusively' or 'only' or 'entirely'. 3. As regards the dutiability of polyurethane foam arising during the course of manufacture of such composite articles of plastics by in situ process, it is viewed that such polyurethane foam would be dutiable. It would be possible for the jurisdictional Collectorates to determine the classification of such polyurethane foam after taking all the relevant factors into consideration. 4. The trade interests may also be suitably advised. 5. All pending assessments may be finalised on the above basis.