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TMI Blog1991 (10) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... s appeal is the correct classification for the products picture varnish and Gloss-o-Gloss manufactured by the appellant s Tansi Polish Units at Madras. They filed a classification list No. 83/86 in respect of Gasket shellac and Anti-corrosive Black paints, picture varnish and gloss-o-gloss manufactured by them under Chapter Heading 32, 27 and 38 of CET Act, 1985. The department did not accept the classification sought by them in respect of picture varnishes and gloss-o-gloss under Heading 3208.90 attracting duty at the rate of 20% ad valorem. Therefore, the department issued a show cause notice dated 23-1-1987 asking them to explain as to why this two product should not be classified under Chapter No. 3210.90 of Central Excise Tariff Act, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 90 and not under Tariff Item 3210.90 of CET Act, 1985. 4. The Assistant Collector upheld the contention of the assessee and held that the two products to be classified under Tariff Item 3208.90 of Central Excise Tariff Act, 1985, on the following forms as (a) to (d) in the order-in-original : (a) It is seen from the chemical report that the composition of picture varnish is based on Maleic Resin, which is nothing but a chemically modified natural polymer dispersed or dissolved in a non-aqueous medium; (b) Varnishes are liquid preparations used for protecting or decorating surfaces. They form a dry, water insoluble, relatively hard, more or less transparent or translucent smooth, continuous film which may be glossy, matt or satiny. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istant Collector. In the personal hearing it was explained to the Collector (Appeals) that the goods cleared are in non-aqueous medium (ready to use). They had submitted that the claim is for classification under Heading 3208 and not under 3208.90 in view of the Chapter Note No. 3, and that the goods are not non-excisable not being covered by Chapter 32. The Collector (Appeals) observed that these contentions raised before him had not been urged before the Assistant Collector at any point of time. He has noted that 3208 has got sub-headings 3208.10, 3208.20, 3208.30, 3208.40 and 3208.90. The learned Collector has observed that the assessee was unable to say before him that in which sub-heading 10 to 40, the goods were classifiable. He obser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... solution other than collodions consisting of any products in 39.01 to 39.13 dissolved any volatile organising solutions; when the weight of the solvent exceeds 53% of the weight of the solution. They contend that if the goods manufactured by them do not conform to the above conditions then in that event headings other than the Heading 3208 is not applicable and thus the products are not dutiable. They contend that in their case interpretation of Rule 5 is more applicable which lays down that the classification of the goods in the sub-headings of a heading shall be determined according to the terms of those sub-headings and any related chapter notes and therefore, they contend that by applying Rule 5 of the interpretation rules, although th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 8. He further pointed out that Note 3 is not a note which excludes any goods. It is an explanatory note to 3208 and had explained that it excluded the solutions (collodions) within its ambit consisting of any of the products specified in Heading No. 39.01 to 39.13 in volatile organic solutions when the weight of the solvent exceeds 53% of the weight of the solution. He further pointed out that chapter sub-heading 32.08 read in the end solutions as defined in Note 3 to this Chapter . Therefore, it implied that solutions in volatile organic solvents, when the weight of the solvent exceeds 53% of the weight of the solution meant that he did not exclude those products which had less percentage than 53%. 9. We have carefully considered th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olvents when the weight of the solution exceeds 53% of the weight of the solution. It means products even if they have exceeded their percentage by 53% they are covered in the Chapter Note 3208. What is not covered in Chapter 3208 are solutions other than collodions consisting of any products specified in the Heading Nos. 39.01 to 39.13. It cannot be read to mean that solutions in volatile organic solvents when the weight of solvents is less than 53% of the weight of the solution are excluded from Heading 32.08 . The words other than collodions are in bracket. We are of the view that this confusion has arisen because the entire words other than collodions consisting of any of the products specified in Heading Nos. 39.01 to 39.11 should ..... X X X X Extracts X X X X X X X X Extracts X X X X
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