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TMI Blog2000 (8) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... was trying to classify the impugned product under Tariff Item 15A whereas they were classifying the product under Tariff Item 68 of the Old Central Excise Tariff and the same was accepted by the Assistant Collector vide Adjudication Order dated 25-1-1983; that they have been manufacturing PEGs for more than a decade; that the molecular weight of each PEG is mentioned as suffix, for example, PEG 200, PEG 300, etc., that such nomenclature is being used by all the manufacturers of PEGs; that all PEGs predominantely exhibit chemical behaviour acyclic alchol; that PEGs are condensation products of Ethylene Glycol and Ethylene Oxide; that Ethylene Glycol is indisputably an alcohol; that Polyethylene Glycols are Polymeric derivative of Ethylene Glycol and have general formula HOCH2 (CH2 OCH2) CH2OH. He referred to technical book namely, "ALCOHOLS, THEIR CHEMISTRY PROPERTY AND MANUFACTURE, by Monick J.K." and the affidavit of Prof. D.D. Kale of Deptt. of Chemical Technology, University of Bombay. In his opinion, Prof. Kale has mentioned that all grades of PEG can be regarded as acyclic alcohols. The learned Sr. Advocate also referred to the "Encyclopaedia of Chemical Technology," by Kirk ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Chapter 39 or Alcohol having more than 5 monomers. The learned Sr. Counsel, relying upon the decision of the Supreme Court in the case of Hindustan Ferrodo v. C.C., Bombay, 1997 (89) E.L.T. 16 (S.C.), submitted that onus of establishing that goods are classifiable under a particular tariff entry lies upon the department; that the department must have some independent evidence to show that the impugned PEGs are Polyethers; that the department could not merely rely on Note 3(c) to Chapter 39; that on the other hand the appellants have shown by independent evidence such as technical literature and an expert opinion by Prof. Kale that PEGs are classifiable as alcohol falling under Chapter 29. In this connection he relied upon the decision in the case of CCE, v. Calcutta Steel Industries, 1989 (39) E.L.T. 175 (S.C.), wherein it was held that if the department wants to tax a particular goods known as such then the onus is on the Revenue. 3.Finally, the learned Sr. Counsel submitted that the demand is totally time-barred as the show cause notice was issued on 4-5-1992 for demanding the duty for the period from April, 1987 to July, 1991; that classification list have been finalised a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ings of the Collector (Appeals) in the impugned order dated 30-3-93 to the effect that if the products conform to the descriptions of the goods covered by a heading it must be construde that these products are not hit by a Chapter Note is completely against Rule 1 of Interpretative Rules which provides that for legal purposes, classification shall be determined according to the terms of the headings and any relevant Section or Chapter Note; that accordingly Note to any Chapter cannot be disregarded. 5.Shri L.P. Asthana, learned Advocate, further, mentioned that in the case of S.M. Dyechem Ltd. the Collector (Appeals) under the impugned order dated 6-5-94 has taken into consideration Chapter Note as he has given his clear findings that the Asstt. Collector had only discussed about Note 3(c) to Chapter 39 and had not recorded any findings about Note 2(b) to Chapter 39 and Note 1(a) to Chapter 29; that Collector (Appeals) has also given his findings that all the products from PEG 300 to PEG 6000 are separate chemically defined organic compounds as they have got definite molecular structure and definite molecular weight which are represented by numbers 300 to 6000. Learned Advocate a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t does not have definite molecular weight, that the department has classified PEG 1400 under Chapter 34; that in Chemistry averaging is done while writing a formula. Shri Setalvad mentioned that use of term 'n' does not take away the impugned product from being a separate chemically defined organic compound of known structure. Shri H.K. Jain, learned SDR, replied that Polymers having high molecular weight has wax and that is why PEG 1400 was classified under Chapter 34. 8.We have considered all the submissions putforth before us. We observe that for classifying the impugned product the department has mainly and heavily relied upon Note 3(c) to Chapter 39 which reads as under :- "Heading Nos. 39.01 to 39.11 apply only to goods of a kind produced by chemical synthesis, falling in the following categories :- (a) ........... (b) ........... (c) Other Synthetic Polymers with an average of atleast 5 monomer units." 9.The Collector, Central Excise, Bombay-III, in his impugned order has given his finding that Note 1 to Chapter 39 is definitive Note on Plastic and not a note on classification, and therefore, he rejected the contention of the appellants M/s. National Organic Chem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pecific heading is on the department as held by the Supreme Court in the case of Calcutta Steel Industries and Hindustan Ferrodo, supra. Further, in the case of Collector of Customs, Cochin v. Premier Tyre Ltd., 1985 (20) E.L.T. 124, it was held by the Tribunal that PEG 300 does not fall under Chapter 39 of the Customs Tariff. In view of the fact that the department had not substantiated the classification of the impugned product under heading 39.07 we hold that the product is not classifiable under the said heading. Accordingly, appeal No. 1812/94-C 795/99-C filed by the Revenue are rejected and cross objection filed by M/s. S.M. Dyechem are also disposed of. 10.Shri Setalwad, learned Sr. Advocate appearing on behalf of M/s. National Organic Chemical Industries Ltd., has submitted that demand is hit by the time limit specified in Section 11A of the Central Excise Act. He has contended that they had described their product in the usual manner as PEG200-PEG300, etc. and the description was same whether the classification list was filed under old Central Excise Tariff or new Central Excise Tariff, and their classification lists were approved. The samples of their product were als ..... X X X X Extracts X X X X X X X X Extracts X X X X
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