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TMI Blog1989 (3) TMI 235X X X X Extracts X X X X X X X X Extracts X X X X ..... liquid gold is subject to the provisions of the Central Excises and Salt Act, 1944. 3. Appellants No. l M/s National Gold Industries, Agra filed their Classification List No. 180/86 w.e.f. 25-10-1986 classifying liquid gold under sub-heading 3207.90 claiming to be ceramic colour and additives (chemicals) under sub-heading 3801.90 of Central Excise Tariff Act, 1985 and claimed the exemption from payment of whole of Excise duty under Notification No. 35/85-C.E., dated 17-3-1985 as amended by Notification No. 78/86-C.E., dated 10-2-1986. However, the Assistant Collector ordered classification of the liquid gold under sub-heading 3207.90 and additives (chemicals) under sub-heading 3801.90 respectively and after holding so rejected the claim for exemption under the said Notification vide his Order-in-Original No. E/Val/87 dated 21-1-1987. 4. Likewise the other appellants M/s Indian Ceramic House also filed their Classification List No. 181/86 w.e.f. 15-10.1986 classifying liquid gold under sub-heading 3207.90 claiming to be ceramic colour and also claimed exemption from payment of whole of Excise duty under the aforesaid Notification No. 35/85-C.E, dated 17-3-1985 as amended by Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appropriate Tariff heading. Under Tariff Heading 32.07, the description reads as Prepared pigments, prepared opacifiers and prepared colours, vitrifiable enamels and glazes, engobes (slips), liquid lustres and similar preparations, of a kind used in the ceramic enamelling or glass industry. I observe that the Heading uses expressions Prepared Colours and liquid lustre and they cannot be taken to include the same goods. I also observe that under the Heading Note in the HSCN liquid lustre has been explained as solution or suspension of metallic compounds in spirits of turpentine or other organic solvents, used for decorating ceramics or glassware. The most widely used are gold, silver, aluminium or chromium lustres. I observe that even though the Heading Notes of the HSCN have not been made part of the Central Excise Tariff, yet going by the Tariff description of the Heading 32.07, which is same both in the Central Excise Tariff as also in the HSCN, useful assistance can no doubt be derived in understanding the scope of a Tariff Entry. The technical literature produced by the appellants and the various certificates are useful for the purpose of understanding that gold is o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... persuaded themselves to follow the Explanatory Notes under the HSCN. He highlighted that the Collecter (Appeals) after having observed that in the books referred to by the appellants gold has been described as colouring material and there is no dispute that gold/liquid gold is a ceramic colouring material erred in holding that this relates to the aspect of use and not of classification under the Central Excise Tariff Act and further misguided himself by first creating and then following the distinction between the two expressions, i.e. Prepared colours and Liquid lustres" completely overlooking that the term Liquid lustres is also followed by another expression similar preparations . He laid emphasis on the chemical properties of the two. According to him liquid gold and lustres are both metal solutions having similar end-usage i.e. decoration of ceramics. Therefore keeping in view these factors liquid gold can be considered to be preparation similar to liquid lustres particularly in the context of ceramicware. To put it differently according to the learned Counsel metal solutions having iridescent finish ware called lustres whereas other metallic solutions which do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lustres and similar preparations of a kind used in ceramic enamelling or glass industries. Therefore, the question before us boils down to whether liquid gold can be considered as ceramic colours. 11. The Assistant Collector rejected the appellants claim for the exemption because according to him the description given of liquid gold as well as use indicated that it was liquid lustres. The Appellate Collector observed that as Notification No. 35/85 as amended does not include liquid gold/liquid lustres as an entry, the concession cannot be given. He further noted that ceramic colours referred to in the Notification are not identical with liquid lustres. In effect the reason for rejection was that liquid gold was not specifically mentioned in the Notification (The Collector referred to the amending Notification only but it is clear that he meant Notification No. 35/85 as amended by Notification No. 78/86). 12. In our view the interpretation given by the lower authorities renders the notification inoperative. When the Notification exempted ceramic colours, the question that should have been examined was whether liquid gold, whatever be its clarification, can be considered as cer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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