9911796707
TMI Blog1994 (11) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... e manufacturers of Glass Moulds assembly consisting of (1) Glass Moulds (2) Gaskets; that on 25th October, the appellant entered into collaboration with an Italian Firm for manufacture of Hard Resin Lenses. The foreign collaborators of the appellants were required to pass on to the appellant their guarded process for the making of Plastic Gaskets and Grinding of Glass Moulds which are necessary for imparting the necessary curve and negative power to such Moulds. For this purpose the appellants purchase Rough Opthalmic Glass which is accurately ground by the appellants. This Technology for accurately grinding and imparting of negative is a closely guarded secret. One Glass Mould ground by the appellants, is of a concave shape while the other is convex. These pieces of ground Opthalmic Glass are known as Glass Moulds in International Trade. A Plastic Gasket which holds the two Moulds is then manufactured out of Ethyl Vinyl Acetate. The said two Moulds are held together by this Gasket. 3. Intelligence was collected by the Central Excise Officers which revealed that the appellants were manufacturing Glass Moulds and Gasket and consuming these products captively for the manufactur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 as held by the Deptt. The ld. Counsel submitted that grinding of Rough Glass Blanks to get Glass Moulds does not amount to manufacture; that no new product comes into existence because Glass remains glass and no new product, with a distinct name, character and use comes into existence; that Glass Moulds cannot be considered as goods as they are not capable of being marketed; that the Tribunal in the case of Bakelite Hylam Ltd. v. Collector, Bombay reported in 1986 (25) E.L.T. 240 had held :- "I have respectfully gone through the order recorded by Vice President (J) and also the elaborate order recorded by my ld. brother Sh. H.R. Syiem. On a cumulative consideration of the material on the subject, as reproduced in the order of ld. brother Syiem, I am inclined to say that the issue of classification is not wholly free from doubt, and that much can be said in support of plea of the importers, for assessment of the subject goods under Tariff Heading 84.60. While, therefore, agreeing with the conclusion of the ld. Vice president (J), I wish to add following observations :- Order portion is in para 75 which reads, "In accordance with the decision of the majority the goods in question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - "This chapter does not cover Laboratory Glassware (Heading No. 70.12) Machinery, appliances or other articles for technical uses or parts thereof, of Glass (Heading No. 70.14 or Heading No. 70.15)". 7. Elaborating his submissions the ld. Counsel submitted that this chapter note clearly excludes the classification of the Glass Moulds under Heading No. 70.14 or 70.15 as the glass moulds manufactured by them were not appliances or other articles for technical uses or parts thereof, of glass. 8. Referring to Note 1(d) of Chapter 70 which reads as : "This Chapter does not cover Optical Fibres, Optically worked optical elements, hypodermic, syringes, artificial eyes, thermometers, barometers, hydrometers or other articles of Chapter 90." The ld. Counsel submitted that this note excludes optically worked, optical elements: that the Glass Moulds are optically worked and, therefore, Chapter Note 1(d) excludes the classification of the impugned goods under Chapter Heading 70. Therefore, the classification of Glass Moulds under Chapter heading is clearly ruled out even by Note 1(d) of Chapter 70; that the goods in question were Moulds for Plastic Lenses and were therefore, fully c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learly of the view that the clinical syringes which the assessee manufactures and sells cannot be considered as "glassware" falling within Entry 39 of the First Schedule of the Act." The ld. Counsel argued that in this decision the Hon'ble Supreme Court emphasised that in popular parlance, a general merchant dealing in glassware does not ordinarily deal in articles like clinical syringes etc. which though made of glass are normally available in medical stores or with the manufacturers thereof. In this view of the matter Glass Moulds were a specialised commodity and, therefore, cannot be classified under ordinary common parlance heading. 11. Referring to the decision of the Hon'ble Supreme Court in the case of Atul Glass Industries v. C.C.E. reported in 1986 (25) E.L.T. 473. The ld. Counsel submitted that the Hon'ble Supreme Court in that case had held :- "We are firmly of the view that the glass mirror cannot be classified as `other glass and glassware' set forth in Tariff No. 23A(4), and must therefore fall under the residuary Tariff Item No. 68." On the ratio of this decision of the Hon'ble Supreme Court, the ld. Counsel submitted that the Glass Moulds manufactured by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ptical working means and that these two questions have clearly been answered by the Tribunal in their order referred to above. 12. It was also argued by the ld. Counsel that cutting, grinding and polishing will not make the goods acceptable for classification under Chapter 70. In support of his contention, the ld. Counsel cited and relied upon the decision of the Tribunal in the case of Collector, Bombay v. Gopal Krishna Bros. reported in 1986 (26) E.L.T. 414 wherein the Tribunal had held : - "9. Sh. Venkatraman further relied upon the Madras Collectorate Trade Notice No. 97 of 1979, dated 27-4-1979. The same (as reproduced in the Cen-Cus Central Excise Tariff for 1985-86 at pages II/45-0-451) reads as follows :- "Optical Glass, Opthalmic blanks and Photographic lenses consequent on the changes made in the Tariff description of Glass & Glassware falling under Item 23A, the following clarifications are issued in the matter of classification of the articles mentioned herein :- (1) Optical Glass : This will fall under sub-item (4) of Tariff Item 23A. (2) Opthalmic Glass Blanks : Opthalmic Glass blocks or Glass blanks, which are used as raw material and are intermed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elements having undergone nearly one or more of the processes which have been polished after moulding. The heading does not apply to unpolished elements having undergone merely one or more processes which precede polishing, such elements fall in Chapter 70." 13. The ld. Counsel submitted that it is a fact that they had in the year 1985 imported two lots of Glass Moulds alongwith Plastic Gaskets and the goods were then assessed under Chapter Heading 70.20 of the Customs Tariff 1975 : that it is also a fact that Chapter Heading 70.20 of the Customs Tariff pari materia to Chapter heading 70.15 of Central Excise Tariff. The ld. Counsel submitted that there is a lot of case law whereunder it has been clearly laid down that this cannot work as an estoppel and, therefore it was argued that a stray instance cannot be taken as a precedent to decide classification. The ld. Counsel also submitted that Rules 3(a) and 3(b) fully supported their case inasmuch as the goods were covered by the specific description in the Central Excise Tariff. Summing up his argument the ld. Counsel submitted that in view of the overwhelming evidence in favour of the appellant, the impugned order may be set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulds meaning thereby that in trade parlance or common parlance the goods are known as glass moulds. The ld. SDR further submitted that on earlier occasion when the said goods were imported by the appellant they were described by them as glass moulds and were assessed to duty under Chapter Heading 70.20 of the Customs Tariff; that Customs Tariff Chapter Heading 70.20 is pari materia to Central Excise Tariff Chapter Heading 70.15. Thus, from whichever angle or test, the goods are looked at they were glass moulds and not Moulds for making plastic articles. In this view of the matter, the ld. SDR submitted that Chapter sub-heading 70.20 and the Notes in the Explanatory Notes of HSN under Chapter 70 clearly show that glass moulds will be covered by Chapter Heading 70; that Chapter Heading 70.20 of the Customs Tariff Act is pari materia to Central Excise Tariff Heading 70.15. 17. On the question whether glass moulds are a different commodity from Opthalmic Lense, the ld. SDR submitted that Glass Moulds are a different commodity from Opthalmic Lense as made out in his earlier arguments that the trade parlance and common parlance test clearly establish the same. 18. On the rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roducts were imported by the appellant himself, they were described as `Glass Moulds'. Thus, we find that the product in common parlance and trade parlance was known as glass moulds. A lot of emphasis was placed by the appellant on the ground that the product is not marketable and does not come to the market for being bought and sold on the ground that the technology for manufacture of the product was a highly guarded secret and, therefore it was not available to the Trade in general. As against this contention, we find that the product was imported by the appellant himself and therefore it is not necessary that the product should essentially come to the market for being bought and sold. The Test is whether the product is capable of being bought and sold in the market. The Hon'ble Supreme Court in the case of U.P. State Electricity Board v. Collector reported in 1994 (70) E.L.T. 3 while dealing with the issue whether the pre-stressed cement concrete manufactured by the Board are goods within the meaning of Section 3 of the Act had observed :- "The fact that the goods are not in fact marketed is of no relevance. So long as the goods were marketable, they are goods for the purpose o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a process of manufacture as also that the product is known to the trade as glass moulds and also that it is capable of being marketed. We shall now proceed to deal with the classification of the product. The two compacting entries for glass moulds are Central Excise Tariff Chapter sub-heading 84.80 as claimed by the appellants and 70.15 as held by the lower authorities. A lot of emphasis was laid on Chapter Note 1(c) of Chapter 84 by the appellants whereas the department was of the view that the goods namely glass moulds are articles for technical use and the Plastic Gaskets were parts thereof and, therefore, were not classifiable under Chapter 84 and were appropriately classifiable under Chapter Heading 70.15. The appellants submitted that glass moulds are not articles of technical use and were therefore not covered by Chapter Note 1(c) inasmuch as glass moulds cannot be termed as appliances for technical use; that the term technical use is understood generally and as glass moulds were not appliances so they were not excluded from the purview of classification under Central Excise Tariff Heading 84.80. The appellants also argued that the goods in question were known as moulds for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion under Chapter Sub-Heading 84.80 that Customs Tariff Chapter Heading 70.20 was pari materia to Central Excise Tariff Chapter sub-heading 70.15 and, therefore, Glass Moulds were appropriately liable for classification under Central Excise Tariff Heading 70.15. 27. On careful consideration of the arguments adduced by both sides, we find that there is force in the arguments adduced by the ld. SDR inasmuch as we have already held that the Mould in dispute were Glass Moulds as known internationally and nationally in Trade/Commercial parlance. They were not moulds for making plastic articles and, therefore, in terms of the Explanatory Notes of HSN the goods were appropriately classifiable under Customs Tariff Heading 70.20 and Central Excise Tariff Heading 70.25. 28. A reference was made also to interpretative Rules and it was contended by the ld. SDR that Rule 3(a) was not applicable, Rule 3(b) was not strictly applicable and that Rule 4 is relevant inasmuch as the goods were most akin to Glass moulds, and that the word `most akin' used therein is relevant inasmuch as the goods were most akin to glass items. 29. On the question of the case law relied upon and cited ..... X X X X Extracts X X X X X X X X Extracts X X X X
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