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TMI Blog1995 (3) TMI 199X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. (ii) Confirmed the classification of Dough Metal Compound under sub-heading 3907.91 and held that this product can be considered for concessional rate of duty at 40% ad valorem under Notification No. 53/88, dated 1-3-1988 vide S. No. 42. 3. The appellants are aggrieved with the order of the ld. Collector. They contend that both the products DMC and SMC are moulding compounds made from polyester and polystyrene resins with an admixture of lubricants, fillers etc. Those which emerge in a dough form are called DMC and those which are pressed flat are called SMC. It is stated by them that they filed a revised classification list on 26-10-1988 seeking reclassification of their products under sub-heading 3907.09 claiming an effective rate of duty of 20% ad valorem, after taking the benefit of the Notification No. 133/88 as amended. The said classification list was approved provisionally. The department drew samples and sent the same to Dy. Chief Chemist for chemical analysis. On examining his report dated 23-1-1989, the ld. Asstt. Collector confirmed the classification under sub-heading 3907.91 and denied the benefit of the said notification. On appeal, the Collector (Appeals) rem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hapter Note 6(b), it is considered as a primary form, as it is made out of polyesterene/ polyester resins. They contend that conversion from one primary form to another primary will amount to manufacture. They submit that SMC has to be classified as DMC, as there is no difference between them and they are covered under S. No. 11 of the table of the Notification No. 53/88, dated 1-3-1988. Thus, they pray that SMC/DMC are classifiable under sub-heading No. 3907.91 of CETA qualifying for the concessional rate of duty at 15% ad valorem and that the benefit of the Notification No. 133/86-C.E., dated 1-3-1986 should be restored. 4. We have heard Shri B.N. Rangwani, ld. Consultant for the appellant and Shri Somesh Arora for the respondent revenue. Shri Rangwani submitted that there was no dispute regarding the classification of DMC under sub-heading 3907.91, but the department had wrongly classified SMC under sub-heading 3920.39, while it should have been also classified under sub-heading 3907.91. Referring to the Explanation in the notification, ld. Consultant submitted that the expression `resin has been defined to mean that `resin shall be taken to include moulding powder of such r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opinion on this point. There is no such finding given in this case. Therefore, in the context of the facts and circumstances of the case, it is but proper that the matter is referred back to the lower authorities for de novo consideration giving liberty to the assessee to produce sufficient evidence both technical as well as trade understanding to prove their case that DMC and SMC are moulding powder of polyester resin and they are not two different products. It is also open to the lower authorities to reconsider the case of the appellants by seeking fresh samples of the goods and getting report from the Chief Chemical Examiner. If the department relies on any expert opinion or any technical literature then a copy of which should be furnished to the assessee to enable them to meet such contentions. The case should be decided after the compliance of principle of natural justice. In the result, the impugned order is set aside and remanded to the lower authorities for de novo consideration. Dated : 25-10-1994 Sd/- (S.L.Peeran) Member (J) 8. [Contra per : S.K. Bhatnagar, Vice President] - With due respects to Hon ble Member (J), my views and orders in the matter are as follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecified in the note ......... would not be covered by the meaning of the expression primary forms given in the statutory note . It has also made it clear that it is still applying 3913.30 in the facts and circumstances of that case and the language of the entry 39.13. Hence, this case also does not help the cause of the appellant. 16. The extract from Modern Plastic Encyclopedia which describes the process of manufacture also does not indicate that it is or could be treated as a bulk form. It of course mentions that SMC is gathered into rolls or layered into containers and the shelf life of the matured compound is about 30 days but that by itself is not sufficient to indicate that it could be considered as similar to one of the bulk forms indicated in the Chapter Note 6(a)(ii) . 17. On the contrary Tariff Heading 39.20 explicitly covers other plates, sheets, film, foil and strip, of plastics, non-cellular, whether lacquered or metallised or laminated, supported or similarly combined with other materials or not and thus specifically applies to plastic sheets. Hence, the Ld. Collector s finding on classification is correct. 18. As regards Notification No. 133/86 it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition by J.H. Briston and Dr. L.L. Katan (George Godwin in association with the Plastics and Rubber Institute), he said that the plastic sheets mentioned in Part II of Chapter 39 of CET are manufactured by seven methods i.e. (i) extrusion of film (ii) calendering (iii) solvent casting (iv) casting of regenerated cellulose film (v) orientation of film (vi) expanded films (vii) plastic net from film and the manufacturing process of these seven methods is given in detail at pages 67 to 86. These plastic sheets can never be manufactured by moulding process and accordingly the sheets which can be moulded are not sheets but only bulk form though it is in the form of sheets. He also referred to Modern Plastic - Encyclopedia 1992 Mid-October Issue and Sheet Moulding Compounds Science and Technology, Edited by Hamid G. Kia (Hanser/Gardner Publications, Inc., Cincinnati) particularly Chapters 1, 5 and 12 therein in support of his contention. He contended that as per Chapter Note 6(a)(ii) of Chapter 39 of CET, the expression primary forms applies to Blocks of irregular shape, lumps, powders (including moulding powders), granules, flakes and similar bulk forms. He said that the item in questi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he note. Sheets, though one of the primary forms in which vulcanised fibre is produced, are possessed of a definite form and shape and does not fit into the forms specified in the note. Since `sheets happen to be one of the primary forms, one can take it that it is a bulk form of vulcanised fibre which has to be fabricated for specific end-uses. But it is not similar to the forms specified in the note. It would, therefore, appear that though sheets constitute a primary form of vulcanised fibre, they would not be covered by the meaning of the expression `primary forms as given in the statutory note. 23. He submitted that the important issue to be considered in this case is whether the item continues to be moulding powder of polyester resin or sheets to avail exemption in terms of Notification 133/86 as amended. He said that on the available material the issue can be decided without remanding the matter to the lower authorities. But without giving a finding on this important issue the Hon ble Member (J) has chosen to remand the matter to decide the issue that too with reference to trade notice and Board s Circular. It is settled position that trade notice and Circular are not bi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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