Central Excise - Duty liability on 'phenolic formaldehyde moulding powder' - Clarification regarding - Central Excise - 93/35/87-CX.3

Central Excise - Duty liability on 'phenolic formaldehyde moulding powder' - Clarification regarding F. No. 93/35/87-CX.3 Dated 31-8-1987 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Central Excise - Duty liability on 'phenolic formaldehyde moulding powder' - Clarification regarding. A doubt has been raised as to whether 'phenolic formaldehyde moulding powders' should be entitled to the concessional duty rate of 25% ad valorem prescribed for 'phenolic formaldehyde resins' as per Serial No. 15 of notification No. 133/86-C.E., dated 1-3-1986, as amended, or such 'phenolic formaldehyde moulding powders' should be assess to duty at the higher concessional rate of 40% ad valorem as per Serial No. 39 of notification No. 32/86-C.E., dated 1-3-1986, as amended. 2. The matter has been examined in this Ministry in consultation with the Chief chemist, CRCL. The Chief Chemist is of the view that 'phenolic formaldehyde resins' and 'phenolic formaldehyde moulding powders', being two different primary forms of resins, have to be treated as distinctively different goods because, as per Chapter note 6 of Chapter 39 of the new Central Excise Tariff, conversion of one primary from of resins into another will amount to manufacture. He is of the view that the expressions 'phenolic formaldehyde resins' appearing in Serial No. 15 of notification No. 133/86-CE dated 1.3.86, as amended, will cover only the 'resol' type and 'novolak' type of phenolic formaldehyde resin and its scope cannot be extended to cover 'phenolic formaldehyde moulding powders.' 3. Accordingly, it is clarified that the concessional rate of duty of 25% ad valorem prescribed for 'phenolic formaldehyde resins' as per Serial No. 15 of Notification No. 133/86-CE, dated 1.3.86, as amended, is not applicable to 'phenolic formaldehyde moulding powders'. As a result, 'phenolic formaldehyde moulding powders' will be chargeable to duty at the higher concessional rate of 40% as per Serial No. 39 of Notification No. 132/86-C.E., dated 1-3-1986, as amended. 4. The above guidelines may be brought to the notice of lower field formations and trade interests also may be suitably informed. 5. All pending assessments should be finalised on the above basis.