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TMI Blog1995 (9) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... 2-1993, after hearing the respondents in the matter, holding that the first item in the Bill of Entry filed by the respondents, namely, insulating kraft paper is covered by the Notification 20/88, but the Assistant Commissioner denied the exemption to the 2nd item in the B/E, namely, epoxy dotted paper on the ground that the goods described against Sl. No. 6 in the table to the Notification 20/88 would cover only insulation kraft paper of the plain or creped variety. The Assistant Commissioner also held that the essentiality certificate from the Development Commissioner cannot be used as evidence for establishing that the item is covered by Sl. No. 6 to the Notification. An appeal was preferred against the Assistant Commissioner s order-in-assessment and the Collector (Appeals) impugned order has held that by epoxy coating goods, in question do not cease to be insulation kraft paper as shown in Sl. No. 6 of the Notification. He also relied upon the reference of technical information submitted by the respondents of M/s. Westinghouse Electric Corporation and M/s. Tomoegawa Paper Co. Ltd. in coming to his conclusion. 3. Shri A.K. Madan, Ld. D.R. appearing for the appellant Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exempts the goods specified in column (2) of the Table hereto annexed and for use in the industry specified in the corresponding entry of column (3) of the said Table when imported into India from (a) so much of that portion of the duty of customs which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as is in excess of the amount calculated at the rate of 25 per cent ad valorem; and (b) the whole of the additional duty of customs leviable thereon under section 3 of the said Customs Tariff Act; subject to the following conditions, namely :- (i) An officer not below the rank of Additional Industrial Adviser of the Directorate General of Technical Development or Industrial Adviser in the off- ice of the Development Commissioner, Small Scale Industries in the Ministry of Industry of the Government of India certifies in each case that the goods im- ported are for use in the industry which is specified against such goods in col- umn (3) of the said Table and also indicates the quantity required in each case. (ii) The importer furnishes an undertaking to the effect that the said imported goods shall be used for the purpose specified in the noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at has been subjected to creping. There is nothing on record to show nor has it been claimed that the epoxy dotted kraft paper is creped kraft paper. Therefore, the goods in dispute cannot be said to be covered by the description insulation kraft paper (plain or creped) occurring against Sl. No. 6 of the Table to Notification 20/88 because the exemption in respect of such paper is confined to the plain or creped insulation kraft paper only and the description against Sl. No. 6 does not speak of resin treated material of insulation kraft paper, but such a qualification occurs in respect of material other than insulation kraft paper. The logic of the Collector (Appeals), echoed by the respondents, that by epoxy coating the goods in question do not cease to be insulation kraft paper covered by Sl. No. 6 of Notification 20/88 is unsound for the above-said reason. As has been observed by the Supreme Court in a recent decision in the case of Rajasthan Spg. Wvg. Mills v. C.C.E. - 1995 (77) E.L.T. 474 (SC) = 1995 (58) ECR 569 since it is a case of exemption from duty there is no question of any liberal construction to extend the term and scope of the exemption notification. Such exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Collector (Appeals) held that by Epoxy coating, goods in question do not cease to be insulation kraft paper as shown in S. No. 6 of the Notification. The test report of the Chemical Examiner of the Customs House clearly shows that the goods are kraft paper. The technical opinion of a retired Chemical Examiner of the Customs House confirmed that the goods under reference are insulating kraft paper with coating of epoxy which is again an insulating material. He also opined that by having a coating of insulating material, viz., epoxy, in furtherance of their intended use as insulating paper, the goods in question clearly retain their identity as insulation kraft paper, even though epoxy dotted. The technical information of M/s. Westinghouse Electric Corporation and M/s. Tomoegawa Paper Co. Ltd. also confirms that the imported goods retain their identity as insulation kraft paper (plain/creped) in addition to certificate from Development Commissioner regarding the requirement of the goods imported in the manufacture of transformer coil by the party. By simply being epoxy coated or dotted, the goods do not cease to be insulated kraft paper and the epoxy coating does not at all change t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial is to form a barrier between energised parts of an electrical circuit. Various types of materials are used as insulation. Paper is one of them. In Encyclopaedia Britannica Vol. 12, it is mentioned that paper is used to insulate the small wires of telephone cables and the conductors of high voltage power cables; in the latter case the paper is impregnated with insulating oil to improve the quality of the insulation (refer Raja Radio Co. v. Collector of Customs, Bombay - 1995 (75) E.L.T. 251 (SC). 12. The respondent had themselves distinguished the insulation kraft paper from the epoxy dotted paper i.e., the goods under consideration. Both insulating kraft paper and the epoxy dotted paper are used for the manufacture of transformer coils, in the interlayer of turns of wire of coil. In the case of insulating kraft paper the coils in which the said paper had been used are required to be dipped in the varnish and then dried in oven for wounding strength mechanically/electrically. In the case of epoxy dotted paper, however, the necessity of dipping in varnish is eliminated. The epoxy resin in the epoxy dotted paper hardens completely when it is heated at 120oC for 6 to 8 hours ..... X X X X Extracts X X X X X X X X Extracts X X X X
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