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TMI Blog1992 (3) TMI 227X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tariff. On 20-9-1982 they were served with a notice requiring them to show-cause as to why the friction tapes produced by them should not be classified as 'Processed Cotton Fabrics' under Tariff Item 19(I)(b). Though the show cause notice referred only to 'rubberised cotton tapes'; the Assistant Collector in his order dated 2-1-2985 held that both the rubberised cloth and tape manufactured by the respondents were classifiable under Tariff Item 19(I)(b). Being aggrieved by the order passed by the Assistant Collector, the respondents filed an appeal before the Collector of Central Excise (Appeals), who held that rubberised or friction tapes were not covered Tariff Item 19 and even if it was assumed that they were classifiable under Tariff I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not vulcanised. In this regard he placed reliance on the unreported decision of the Bombay High Court in Misc. petition No. 401 of 1963 in the case of Cosmos India Rubber Works (P) Ltd. v. Collector of Central Excise and Others reported in..... He added that after the decision of the Bombay High Court, the Ministry of Finance had also clarified in the letter F. No. 18/56-164 (M) C. Ex. 11, dated 15-2-1966 that duty was not recoverable on unvulcanised rubber coated fabrics since they were not marketable. He contended that once the cotton fabric is coated with rubber, it loses its identity and a new intermediate product emerges which on being cut results in an item known as friction tape which not being specifically covered by Item 19(I)(b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to duty under Item 19 of the Central Excise Tariff, on the ground that it was not marketable. Paragraphs 7, 8 and 9 of the said judgment are reproduced below: '7. Mr. Hidayatullah appearing for the petitioners pointed out that there are more than one judgments of this Court as also of other High Courts that as the item is not marketable or saleable, it cannot be considered as goods for the purpose of charging any excise duty. There is one unreported case being Misc. Petition No. 401 of 1963 (Cosmos India Rubber Works Pvt. Ltd. and Another v. G. Koruthu, Collector of Central Excise and Two Others) decided by Mr. Justice Tarkunde, as he then was. The judgment is dated March, 1966. The relevant portion of the judgment is as follows : "S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esses such as trimming, threading and redrawing. After the cans are trimmed, threaded and redrawn they are reeded, beaded and anodised or painted. It is at that point only that they become a distinct and complete component, capable of being used as a flashlight case for housing battery cells and having a bulb fitted to the case. We find it difficult to believe that the elementary and unfinished form in which they exist immediately after the extrusion suffices to attract a market. The appellant has averred in affidavit that aluminium cans in that form are unknown in the market. No satisfactory material to the contrary has been placed by the respondents before us. Reference has been made by the respondents to the instance when aluminium cans ..... X X X X Extracts X X X X X X X X Extracts X X X X
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