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TMI Blog1987 (7) TMI 321X X X X Extracts X X X X X X X X Extracts X X X X ..... as amended. Samples of the product were tested at the Customs House Laboratory, Calcutta and the Chemical Examiner in his report stated that the product is Polyester resin. The respondents disputed the correctness of the Chemical Examiner s report communicated to them by the Superintendent of Central Excise under his letter, dated 25-11-1981 and requested for retest of the sample as per their request, dated 4-12-1981. No action seems to have been taken on this letter of the respondents. The Assistant Collector of Central Excise, Asansol Division by his order, dated 12-8-1982 rejected the claim for classification as Maleic resin and exemption under the notification. The respondents then filed appeal before the Collector, (Appeals) Central Excise, Calcutta. The Collector (Appeals) Central Excise, Calcutta by his order dated 3-4-1983 held that the appellants request for retest of samples as per Rule 56(4) of the Central Excise Rules, 1944 should have been granted and then decision for approval of the classification list taken. He held that the Assistant Collector should not have returned the classification list to the respondents. The Collector (Appeals) set aside the order of the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This letter was followed by another letter, dated 21-6-1983 addressed to the Superintendent of Central Excise and Customs, Purulia Range, West Bengal intimating that the Testing Centre, Eastern Region, Calcutta was advised by Head of Department of Chemical Engineering, Jadavpur University that the testing fee would be Rs. 3,000/- at the rate of Rs. 500/- for each sample and the same may be sent by crossed cheque drawn in favour of the Registrar of the University. Copies of these letters were forwarded to the Assistant Collector of Central Excise and Customs, Asansol, Prof. R.N. Mukherjee, Head of Department of Chemical Engineering, Jadavpur University and the manufacturers M/s. Eastern Chemofarb Ltd. (Appendix H of the respondents paper book). There is another letter, dated 13-10-1983 from the Assistant Collector of Central Excise and Customs, Asansol Division addressed to the respondents M/s. Eastern Chemofarb Ltd. intimating of the tests conducted by the Regional Testing Centre, Eastern Region, Calcutta and the Chief Chemist, New Delhi and calling upon the manufacturers to re-submit the classification list for approval (Appendix I of paper book). There is another letter, date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rved that respondents had themselves relied on the report of the Chief Chemist, Central Revenues Control Laboratory and he could not but also rely on the same report and that it was for him to give credence to the report of the Chief Chemist in terms of the order of the Appellate Authority. Relying on the report of the Chief Chemist, he held that these samples were unsaturated polyester resins and therefore, they could not be termed as maleic resin. He rejected the claim for exemption under the notification. 5. Aggrieved with this order, the respondents filed appeal to the Collector (Appeals) Central Excise, Calcutta. The Collector (Appeals) Central Excise, Calcutta by order, dated 13-9-1984 held that there are two conflicting opinions of the product of the manufacturer. One technical opinion says the products are maleic resin whereas another technical opinion feels that the product do not conform to the definition of maleic resin given below exemption Notification No. 157/81. He observed that there are two technical opinions - one available to the assessee i.e. Head of Department of Chemical Engineering, Jadavpur University through the Chief Chemist, Regional Testing Centre, Min ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to raid on 5-5-1986 on the respondents factory. This prayer was opposed by Shri M. Chandra Shekharan for the respondents. The Bench intimated the parties that the request would be kept in mind when the appeal is disposed of finally by the Bench. 8. We do not think that based on subsequent events, we should remand the present matter to the lower authorities for decision alongwith the proceedings consequent to the seizures made sometime in 1986 if the appeal can otherwise be disposed of on the available material. We reject this prayer of Shri Sunder Rajan for remanding the matter to the lower authorities on the ground of subsequent seizures. 9. The manufacturing process of the appellants product which is not in dispute, is as follows - Our products are produced by the polycondensation reaction of Maleic Anhydride with polyhydric alcohols like Propylene Glycol and Diethylene Glycol and chemically modified with polybasic acid/ anhydride like phthalic Anhydride or Isophthalic Acid, etc. Finally it is dissolved in unsaturated hydrocarbons like Styrene Monomer (reactive diluent) to get optimum properties of the above resins. No physical blending of any artificial or synthetic resi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, observe that we are in fact surprised when we find that the Head of Department of Chemical Engineering, Jadavpur University, volunteered information in the last para of their opinion - It may also be concluded that the products conform to the definition of maleic resin as laid down in GOI Notification No. 157/81-C.E., dated 29-8-1981. The Test Memos as also Regional Testing Centre letter, dated 25-5-1983 show that the tests were to be on the following points - (1) Whether the sample is maleic resin? (2) What are the ingredients used in the manufacture of the said product?" We do not find any reference to the notification either in the Test Memos or the letter. It is not clear under what circumstances it become necessary for the Head of the Department of Chemical Engineering, Jadavpur University to express this opinion. As to whether they could do so, is a different question which we would deal with when we deal with the opinion of the Chief Chemist. However this portion is separable and if the rest of the test report be acceptable and trustworthy, the same should not be excluded from consideration. 12. Notification No. 157/81, has an explanation setting out the me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certain and beyond his jurisdiction and submitted that the opinion expressed by Head of the Department of Chemical Engineering, Jadavpur University was preferable to the opinion expressed by the Chief Chemist. 16. At this stage, it would be necessary to reproduce the relevant portions of the opinion of Chief Chemist, Central Revenues Control Laboratory, New Delhi and that of Head of the Department of Chemical Engineering, Jadavpur University. After reciting the explanation in Notification No. 157/81, dated 29-8-1981 as to meaning of expression maleic resins, the Chief Chemist, Central Revenues Control Laboratory, states as under - Contrary to this definition the book outlines of Paint Technology by Morgans at page 232 describes maleic resins as those produced by the reaction between maleic anhydride and resin utilizing the dil Alder Reaction. A number of conjugated unsaturated systems can be used including resin (abietic acid). The product can than be estrified with glycerol or Pentoerythritol. 17. The unqualified definition for Maleic Resins without mentioning its end use as contained in Notification No. 157/81-C.E., dated 29-8-1981 is very wide to cover reaction produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ALPOL 72-231 330 C - 355 C Isophthalic acid CALPOL 72-250 - do - - do - CALPOL 10-214 - do - - do - CALPOL 42-00 About 200 C Phthalic acid CALPOL 44-00 - do - - do - CALPOL 40-00 No Residue was obtained and presence of acid could not be confirmed. Saponification filtrate was neutralised, dried over quick lime and fractionally distilled. High boiler was identified as propylene glycol/ diethylone glycol also from their distinctive smell. Presence of glycols was also confirmed by periodate method. It is concluded that all the sample consist of fumeric acid reacted with polyhydric alcohol namely propylene glycol/diethylene glycol chemically modified with a polybasic acid namely isophthalic acid/phthalic acid dissolved in styrene. The sample CALOL 40-00 appears not to contain any isophthalic/phthalic acid. However maleic anhydride may have been used in place of fumeric acid and this fact will not be discernible in any test, since maleic anhydride rearranges itself into fumeric acid during the chemical reaction of the type mentioned above. It may also be state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en challenged as being factually incorrect by Shri Sunder Rajan and there would appear no reason to exclude the same from consideration. 21. The first opinion, dated 4-8-1983 of the Chief Chemist, Central Revenues (reproduced at page 3 of this order) is extremely brief. His main opinion is to be found in his letter, dated 5-8-1983 (material portions of the same reproduced at page 13 of this order). Apart from the legal infirmities in these opinions which have already been pointed out above, even this information does not definitely lead to the conclusion that the appellants products would not come within the definition set out in the notification. The very first sentence of the opinion reproduced at page 13 shows that the learned Chief Chemist seeks to contradict the definition set out by placing reliance on a book named Outlines of Paint Technology by Morgans. The next para of the opinion also shows that according to the learned Chief Chemist, the definition of maleic resin set out in the notification is very wide. It is probably suggested that the definition would include the appellants product. The definition however, appears misleading to the learned Chief Chemist and he ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... portion therefore, of the definition is not material and relevant for the purpose of this appeal. The only thing surviving for consideration is the role of unsaturated hydrocarbons, in this case, styrene monomer which according to the appellants process of manufacture, is a reactive diluent and according to the information of the Chief Chemist, at one stage of his information, reproduced at page 13 is a diluent added after polycondensation of other ingredients is completed. According to this information this styrene is a reactive diluent and a well known ingredient in certain category of resins known as unsaturated polyesters but not in maleic resins or solutions thereof. According to the Chief Chemist, styrene has not been used to react with maleic acid anhydride or fumeric acid in the manufacture of product. Presumably, at that stage of the information, the Chief Chemist wants to say that it is a simple diluent. But in the last portion of his information, he says that the presence of styrene has a reactive diluent. 24. Now the notification reproduced at page 11 is clear that on the base material, maleic acid, fumeric resins and hydrocarbons, fumeric acid with one or more compon ..... X X X X Extracts X X X X X X X X Extracts X X X X
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