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TMI Blog2006 (3) TMI 565X X X X Extracts X X X X X X X X Extracts X X X X ..... use notice proposed to recover the said duty and impose penalties. The appellant resisted the proposed classifications and duty demand; but failed. Under an adjudication order dated 28-7-05, the Commissioner, Central Excise, Noida confirmed the duty demands and imposed penalties on the appellant manufacturer and its director, Shri N.K. Gupta. The present appeals are directed against the duty demands and penalties made under that order. 3. The finding in the impugned order is that floor covering with plastic lamination on both sides will be excisable under tariff heading 3918.90 and floor covering with plastic lamination on single side would be classifiable under tariff heading 5903, during the relevant period. Thus, the finding is that the plastic lamination on both sides makes the material floor covering of plastics while with plastic lamination on one side, the material is laminated textile fabrics . The appellant contends that both varieties are not plastic items. It is being contended that these are rot proof jute products which were liable to central excise duty at nil rate and thus there was no duty liability. 4. Having noted the controversy, we may now state the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, made predominantly of jute, though sold exclusively as dunnage material for food sugar and fertilizer go-downs and though falling under IS for fabric etc., the revenue has classified the two sides laminated material under Chapter 39 which is for plastic. The main reason for such a classification is that Note 2(a)(3) under Chapter heading 59 has clarified the product as falling outside heading No. 59.03 and would fall under Chapter 39. We may read that Note: 2. Heading No. 59.03 applies to: (a) Textile fabrics impregnated, coated, covered or laminated with plastics, whatever the weight per square metre and whatever the nature of the plastic material (compact or cellular) other than: (1) .. (2) .. (3) Products in which the textile fabrics either completely embedded in plastics or entirely coated or covered on both sides with such material, provided that such coating or covering can be seen with the naked with no account being taken of any resulting change of colour (Chapter 39) In regard to flooring material which is laminated only on one side, revenue is in agreement that the heading would be 59.03, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Hon ble Supreme Court in the case of Atul Glass Industries Ltd. and others v. C.C.E. and others - 1986 (25) E.L.T. 473 (S.C.) held as under : 8. The test commonly applied to such cases is: How is the product identified by the class or section of people dealing with or using the pro duct? That is a test which is attracted whenever the statute does not contain any definition. Porritts and Spencer (Asia) Ltd. v. State of Haryana - 1983 E.L.T. 1607 (S.C.) = (1978) 42 S.T.C. 433. It is generally by its functional character that a product is so identified. In Commissioner of Sales Tax, U.P. v. Macneill Barry Ltd., Kanpur - 1986 (23) E.L.T. 5 (S.C.) = (1985) 2 SCALE 1093, this Court expressed the view that ammonia paper and ferro paper, used for obtaining prints and sketches of site plans could not be described as paper as that word was used in common parlance. On the same basis the Orissa High Court held in State of Orissa v. Gestetner Duplicators (P) Ltd. (1974) 33 S.T.C. 333 that stencil paper could not be classified as paper for the purposes of the Orissa Sales Tax Act. It is a matter of common experience that the identity of an article is asso ciated with its primary function ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an under the entry which related to glasswares in the U.P. Sales Tax Act. 12. The rival tariff headings in question do not specifically mention the product or define the product. Both headings are general in nature, of plastics and of textile fabrics . Therefore, between these two entries, the entry for textile fabric would appear to be more appropriate inasmuch as the main material in the article in question is hessian and the commercial identity is derived from properties of hessian. 13. Apart from the above, the HSN Note under 3918 also would appear to rule out classification under that heading. We may read the heading and the relevant note: 39.18 : Floor coverings of plastic, whether or not self-adhesive, in rolls or in the form of tiles; wall or ceiling coverings of plastics, as defined in Note 9 to this chapter. The first part of the heading covers plastics of the types normally used as floor coverings, in rolls or in the form of tiles. It should be noted that self-adhesive floor coverings are classified in this heading . The evidence showing that the floor coverings in question are normally used as floor covering is entirely lacking in the record. The r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... products, provided the appropriate duty of excise under the First Schedule has already been paid on the unprocessed jute manufactures used in the manufacture of such jute products. Nil - - Notification No. 6/2002-C.E., dated 1-3-2002 (Sl. No. 116) 116 53, 59 or 63 Rot proofed jute products, laminated jute products. Nil - 21 It is to be noted from the above notifications that rot-proof jute products, laminated or not, were being subjected to nil rate of duty. We have already observed that the product in question is a jute product going both by its composition and commercial identity and the notifications make it clear that even laminated jute products would fall under that category. It is hard to argue that a laminated item retains its identity only if it is laminated on one side and upon lamination on both sides, it assumes the identity of the lamination material, particularly, when trade and commerce recognise the item for the properties derived from the basic material (jute) in the area of moisture resistance, pressure resistance and heat resistance. 15. The appellant has also brought on record that oth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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