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TMI Blog1987 (12) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... for conservation of Thermal Energy. The process of manufacture is that the slag, which is a refuse separated from the metal (steel) in the process of melting, is mixed with fluxing agents like lime-stone etc. The mixed metal is melted in a cupila with hard coke. After the slag is melted, the material comes out at the bottom of the cupila and below the belt, there is a centrifugal disc, which throws the metal into atmosphere. Due to velocity of wind and the centrifugal force, the said metal takes the shape of wooly substance and is generally in loose parlance called "slagwool". These fibres cannot be spun into yarn like synthetic fibres of organic nature. 3. Prior to 1973, the appellants did not take any Central Excise Licence. They did not pay any duty either. During May, 1973, they were informed that Central Excise duty had been imposed on the products w.e.f. 30-4-1973. The appellants were directed to declare stocks and follow the Central Excise formalities. The appellants say that they complied with the instructions under the erroneous belief that they were legally to pay the duty. Later, the appellants took advice from the Technical Experts. They were informed that the produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... technical and scientific term as defined in BTN, CCCN, Central Excise Tariff Act, Customs Tariff Act, Moncrieffi's Books and other standard reference books. In particular, in trade parlance also, in term is associated with the textiles production. The Government of India in their Tariff Circular No. 90/65 and Notification 175/65 have supported this view; (iii) In 1965 and thereafter the term 'slagwool' was mis-understood with the term 'glasswool' which is a synthetic fibre and could be spun into yarn for weaving fabrics. The mis-interpretation has led to the grouping of 'slagwool' in the notifications issued for goods under T.I. 18; (iv) If 'Man-Made Fibre' is to be interpreted to mean all fibres made in a factory, then metallic yarn could not have been shown as a separate entry in the Tariff. During 1976, Tariff Entry 22F was introduced to cover all mineral fibres implying thereby that they could not have been covered by Tariff Entry No. 18 earlier; and (v) The Tariff grouping under TI-18A to E refer to products of the textile industry or products pertaining to the family of textiles only. 7. In the prior decision of M/s. Punj Sons (P) Ltd., the Tribunal has come to a cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich formed the raw material and also the finished product "slagwool" were produced before us. The fibres could be seen though they could not be used for spinning. Both the appellants and the Revenue do not dispute that the product is a fibre. 11.The main question to be decided is whether this 'slagwool' would come within the purview of the words "Man-Made Fibres". The Tariff Entry 18 at the relevant time referred to Rayon and Synthetic Fibres and Yarn. It is nobody's case that the product is a Rayon Fibre. It is a "Synthetic Fibre" since it consists of slag and fluxing agents and is artificially produced. The explanation to TI-18 has widened the scope of the entry. By virtue of a deeming provision, "Man-Made Fibres" have been included within the ambit of the entry. Sl. C.L. Beri, emphasised that the mineral fibre could, by no stretch of imagination, qualify to be a "member" of the textile family and hence the duty liability under TI-18 would not arise. The department, on the other hand, venture to establish that the entry is not restricted to products of the textile industry but cover also other items. There is considerable force in the contention of the department for, we find t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... But this definition will not decide the issue because the standards has been preferred in respect of fibres and zippers in Textile Industry. 14. Chapter 51 of BTN refers to 'Man-Made Fibre' (continuous). The term 'Man-Made Fibre' means fibres or filaments of organic polymers produced by manufacturing process, polymerisation or condensation of organic matters. The second is chemical transformation of organic polymers such as cellulose acetate and algenates. But the chapter heading refers to 'Man-Made Fibre' (continuous). Having regard to the chapter notes, the definition in the BTN cannot be taken to provide the basis for the purpose of classification of the product in question. 15. Chapter 68.07 of CCCN, refers to 'slagwool, 'rockwool' and similar 'mineral wools'. It must be noted that in the harmonised code 'slagwool', 'rockwool' and similar 'mineral wools' have been classified under Heading 68.03 "Articles of stone, plaster, cement, asbestos of other similar materials". In our view the classification in the present dispute cannot be determined on the basis of the subsequent classifications of 'slagwool'. TI 22F has been carved-out in 1976 dealing with Mineral Fibres and Ya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... varied in the past, the correct technical usage makes a distinction based on the origin of the raw material. Accordingly, rayon is a human made fibre but not a synthetic fibre that also falls into the broader classification of human made fibres. In addition to names based on their chemical composition, human-made fibres are customarily known by the manufacturer's name or trade mark, or by terms referring to characteristics properties for example, thermoplastic fibres, or manufacturing process, for example, wet spun fibres and viscose rayon. In the McGraw Hill Dictionary of "Scientific and Technical Terms" Mineral Wool has been defined as follows :- "Mineral Wool - a natural fibre of mineral origin resembling wool or glass fibre and formed by blowing air or steam through molten rock of slag; examples are asbestos and synthetics in the form of whiskers made from inorganic compounds; used for insulation and fire-proofing, and as a filter medium." The New Encyclopaedia Britannica (Vol. 7), 15th Edition, we find the following definitions :- "Man Made Fibres : consists of two broad groups, based upon the origin of the fibre-forming substance. The first group, of which rayon and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the parties submitted two samples of slagwool for clarification whether the material is 'Man Made Fibre' falling under any of the characteristics given in the letter. The opinion what that the samples were not 'Man Made Continuous filament yarn'. This opinion also does not furnish useful data to come to a definite conclusion. We also notice that the opinion was based more on terms and definitions pertaining to the textile industry. 20. The Learned counsel for the appellants drew our attention to the book "Materials Hand Book" by George S. Brady. It was argued that the slagwool has been mentioned under the Heading 'Mineral Wool'. The argument was advanced that slagwool could not, therefore, be a 'Man Made Fibre'. But this argument assumes that slagwool would be outside the purview of man made fibre. It is, no doubt, true that the slag wool is made from slag. But on that account, it cannot be said that it was outside the scope of "Man-Made Fibre". 21.Much emphasis was made relying on the Text Book "Man-Made Fibre" by Moncriess. The learned counsel contended that this Text Book which is an authority on commercial "Man-Made Fibre" contained a list of the numerous fibres man-made a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thetic fibres are grouped as 'Man-Made Fibres'. At Page 270, we find the following :- "Fibres play an increasingly important role in engineering, where they are used as constituents of composite materials. Embedded in a matrix which may be plastic, metal or ceramic, fibres contribute their unique properties to the composite to function in a manner similar to the steel rods embedded in reinforced concrete. Composite materials containing fibres are used in applications in which high strength and low weight are needed, as in aeronautics and astronautics. Fibres retaining high strength at elevated temperatures are valuable in high temperature applications. Since World War II, many types of fibres have been used in composite materials, and the demand for new materials to meet the demands of modern engineering applications has stimulated development of new types. Composites are heterogeneous structures consisting of a continuous matrix in which the fibrous material is dispersed and embedded. Efficient performance of the composite requires a strong bond between the fibre and the matrix. Techniques used in producing composites from fibres and matrices depends upon the nature of the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification. Item 2 thereis is as follows :- "Any other mineral fibre or yarn whether continuous or otherwise, such as slagwool and rockwool and the like." 26. Our attention was also drawn to Notification 115/73, dated 11-12-1973. The Central Government exempted inter alia items falling under TI-18 in respect of Central Excise duty in excess of the duty specified in the Notification. Item 2 is as follows :- "Any other mineral fibres or yarn whether continuous or otherwise such as slagwool and rockwool and the like". 27. The S.D.R. urged that these would indicate that slagwool would fall within the TI-18. She based her arguments on the principle of contemporaneous ex positio. Sh. C.L. Beri resisted this plea on the basis that as early as 15-2-1965, the Government issued a Notification 175/65 exempting glass fibres and glass yarns falling under TI-18 from the whole of the duty leviable and in the notification, they have by some misunderstanding or mis-interpretation added the words, "whether known as glass wool, slagwool, rock wool or by any other name". According to him, this mistake had persisted in the subsequent notifications as well. He laid stress on this point and he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bill in 1976, we find the following in the notes on clauses. "Clause 35 read with the Fourth Schedule, seeks - (b) To exclude mineral fibres and yarn from the category of synthetic fibres and yarn falling under Item 18; (1) To exclude new items in the Central Excise Tariff for - (i) ................ (ii) ................. (iii) Mineral Fibres and Yarn and manufactures therefrom. 31. In the Memorandum explaining the provisions in Finance Bill of 1976, we find the following in respect of Item 22F :- (1) The insertion of this item is consequential to the amendment of Tariff Description of Items 18 22. (2) The existing exemption to (i) Rock Wool; (ii) Yarn Spun wholly out of glass fibre; and (iii) Glass Fabrics will continue. 32.A perusal of the above materials support the view that the category of synthetic fibres under Item 18 included mineral fibres till a separate item was carved out and mineral fibres were excluded. Thus, we have to take a broad view of the matter having regard to the above aspects in resolving the controversy. 33.In the prior judgment in M/s. Punj Sons (P) Ltd., the Tribunal has adverted to the inclusive definition in the tariff entry. There ..... X X X X Extracts X X X X X X X X Extracts X X X X
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