Customs, Excise and Gold Tribunal - Delhi
Meghdoot Laminart Pvt. Ltd. vs Collector Of Central Excise on 29 September, 1989
Equivalent citations: 1990(26)ECC62, 1990(49)ELT75(TRI-DEL)
ORDER D.M. Vasavada, Member (J)
1. In all these appeals, common issue is involved, the issue being, what will be the correct classification of paper-based decorative laminated sheets for the purpose of Central Excise, which is the product of all the manufacturers concerned in this group of appeals. So, we heard all these appeals together and dispose them of by this common order.
2. We may summarise, briefly, facts of these appeals as under.
In Appeal No. E/2962/88-C - Meghdoot Laminart Pvt. Ltd. (hereinafter referred to as "Meghdoot"), the product was, earlier, classified under T.I. 68. When Central Excise Tariff Act, 1985 came into force w.e.f. 28-2-1986, the appellant applied for classification under sub-heading 3920.31 of Chapter 39 which was approved on 18-8-1986. Subsequently, by filing another classification list, the appellant sought revision of the classification w.e.f. 1-3-1986 under another heading 48.18 sub-heading 4818.90 of Chapter 48. The appellant also filed a refund claim on 16-9-1986 for the excess amount of duty paid on clearances effective from 1-3-1986 onwards. A show-cause notice was issued to the appellant and on adjudication, the Assistant Collector held that the product was correctly classifiable under sub-heading 3920.31 and rejected the prayer for revision of classification and also rejected the claim for refund. The appellant went in appeal which was rejected by the Collector of appeals. This order has given rise to the present appeal. The Revenue has also preferred Appeal No. E/3522/88-C against the impugned order passed by the Collector (Appeals) seeking to restore the order-in-original by the Assistant Collector.
3. In Appeal No. E/3311/88-C - Label Laminates (Label in short) appellant had earlier sought classification under sub-heading 3920.31 but had filed a revised classification list seeking classification under sub-heading 4818.90. A show-cause notice was issued and on adjudication, the prayer for revision was rejected by the Assistant Collector. The appellant went in appeal and the Collector of Central Excise (Appeals) set aside the order of the Assistant Collector and ordered to classify the 'product' under sub-heading 4811.39 as against sub-heading 4818.90 claimed by the appellant. So, the appellant has preferred this appeal praying that the 'product' be classified under sub-heading 4818.90 upto 28-2-1988 and sub-heading 4823.90 from 1-3-1988.
4. M/s. Label Laminates (hereinafter referred to as Label) filed refund claim for Rs. 40,89,823.77 for the period from 5-3-1986 to 27-8-1986. The Assistant Collector rejected the refund claim. The appellant went in appeal and the Collector (Appeals), by his impuged order dated 9-12-1988 allowed the appeal, set aside the order of the Assistant Collector and remanded the matter back to the Assistant Collector for de novo consideration. Revenue has preferred this Appeal No. E/1240/89-C against this order.
5. In Appeal No. E/3257/88-C, the appellant Meghdev Enterprises ('Meghdev' in short), also manufacture the same 'product'. They also filed revised classification list on 22-8-1986 claiming its effect from 1-3-1986 thereby claiming classification of the 'product' under sub-heading 4818.90. The Assistant Collector, vide his order dated 5-5-1987, held that the 'product' was classifiable under sub-heading 3920.31. The appellant went in appeal and the Collector of Central Excise (Appeals), Bombay, vide his order dated 9-9-1988 held that the 'product' was classifiable under sub-heading 4811.39. The appellant has come in appeal against this order. The Revenue has also preferred an appeal No. E/3521/88-C against the said order seeking restoration of the order passed by the Assistant Collector.
6. In Appeal No. E/234/89-C, the appellant Shri Laminates (Shri in short) manufacture the same 'product' and filed a classification list dated 10-7-1986 claiming classification under sub-heading 3922.90 which was approved by the Assistant Collector. The Revenue preferred an appeal against the said approval and the Collector (Appeals) by his order dated 4-4-1988, allowed the appeal and ordered classification under sub-heading 3920.31. The appellant has preferred this appeal against the said order.
7. In Appeal No. E/267/89-C, the appellant Milton Laminates Pvt. Ltd. (Milton in short) also manufacture the same 'product' which was also classified under sub-heading 3920.31 and they had also filed a revised classification list under sub-heading 4818.90. Show cause notice was issued and on adjudication, their prayer for reclassification was rejected by the Assistant Collector. In the meantime, the Gujarat Laminate Manufacturers Association, Ahmedabad filed a writ petition in the High Court of Gujarat challenging the aforesaid order-in-original and also orders passed in other similar matters by the Assistant Collector of Central Excise, N.G. Division, Ahmedabad. High Court observed that the order-in-original was defective and a non-speaking one for the reasons that no clear findings were recorded by the authorities as to why the product cannot be called an article of paper and why it could be classified under Chapter 39 as articles of plastics. So the matter was remanded back to the Assistant Collector and after fresh adjudication, the Assistant Collector by his order No. 63/87 dated 15-12-1987, again classified the 'product' under sub-heading 3920.31. The appellant went in appeal and the Collector (Appeals) ordered classification under sub-heading 4811.39. So, the appellant has come in appeal.
8. The Revenue has also preferred Appeal No, E/410/89-C against the impugned order seeking restoration of Order-in-Original passed by the Assistant Collector.
9. In Appeal No. E/332/89-C, the appellant - M/s. Decent Laminates (P) Ltd. (Decent in short) had also applied for the classification of its product and by the same order No. 63/87, the same Assistant Collector rejected the prayer for reclassification and in appeal by the same order, the Collector (Appeals) classified it under sub-heading 4811.39 and the appellant has preferred this appeal.
10. In Appeal No. E/471/89-C, the Revenue has preferred appeal seeking restoration of the Order-in-Original.
11. In Appeal No. E/72/89-C - the Appellant - M/s. Viral Laminates (P) Ltd. (Viral in short) manufacturing the same 'product' had also applied for reclassification on 11-9-1986 and started paying duty under protest pending the approval. On adjudication, the Assistant Collector decided classification under sub-heading 3920.31 and in appeal, the Collector (Appeals) decided classification under sub-heading 4811.39. The appellant preferred this appeal against the impugned order and the Revenue preferred Appeal No. E/134/89-C against the impugned order seeking restoration of the Order-in-Original.
12. This appellant, simultaneously, with filing revised classification list, filed the claim for refund of duty for the period prior to September, 1986 in accordance with the provisions of Section 11B of the Act which was rejected by the Assistant Collector without issuing show cause notice on the basis of order-in-original dated 5-3-1987 whereby he had rejected the prayer for revision of classification and also based on order-in-appeal dated 7-8-1987 whereby the appeal against the said order was dismissed. The appellant went in appeal before the Collector (Appeals). While it was pending, the appellant had preferred an Appeal No. E/3021/87-C before CEGAT against the order of the Collector (Appeals) dated 7-8-1987 whereby he had rejected the appeal of the appellant in matter of revision of classification. In the meantime, the Gujarat Laminate Manufacturers Association, Ahmedabad had preferred S.C.A. No. 4405/1987 in the High Court of Gujarat wherein the impugned order dated 7-8-1987 was also challenged. The High Court was pleased to set aside the order-in-original dated 5-3-1987 and also the order-in-appeal dated 7-8-1987. So, the appellant withdrew the appeal pending before the CEGAT and vide order No. 189/88-C dated 7-3-1988, CEGAT dismissed the appeal as withdrawn. Thereafter, when the appeal of the appellant, against the order of the Assistant Collector, whereby he had dismissed the refund claim, came for hearing before the Collector (Appeals), the Collector (Appeals), by an order dated 12-10-1988, issued on 6-1-1989, dismissed the appeal stating that as the prayer for reclassification had not been accepted by the Assistant Collector and also by the Collector (Appeals) and as the appellants were preferring the appeal before the Appellate Tribunal, the said order of Collector (Appeals) (whereby the Collector (Appeals) had rejected the appeal against the order of the Assistant Collector regarding reclassification) had become final and so this appeal (regarding refund claim) had also become untenable. So, the appellant preferred this appeal No. E/437/89-C against the impugned order.
13. In Appeal No. E/1271/89-C, the appellant - Visnagar Taluka Audyogic Sahakari Mandi Ltd. (Visnagar in short) manufacturing similar 'product' had filed a revised classification list on 15-12-1986 and after the order passed by the High Court of Gujarat (referred to above), the Assistant Collector, on adjudication vide order dated 15-12-1987, ordered classification under sub-heading 3920.31 and in turn, Collector (Appeals) ordered classification under sub-heading 4811.39. So the appellant has preferred this appeal and the Revenue has preferred Appeal No. E/1920/89-C against the impugned order seeking restoration of the order-in-original.
14. In Appeal No. E/1270/89-C, the appellant - M/s. Sundek India (P) Ltd. (Sundek in short) manufacturing similar 'product' had also applied for revised classification and by the same order dated 15-12-1987, the Assistant Collector decided classification under sub-heading 3920.31 and in turn, the Collector (Appeals) decided classification under sub-heading 4811.39. So, the appellant has preferred this appeal. The Revenue has preferred Appeal No. E/1939/89-C seeking restoration of the order-in-original.
15. Similarly, in Appeal No. E/229/89-C, the appellant M/s. Jay Enterprises (P) Ltd. (Jay in short) manufacturing the similar 'product' had filed revised classification list and by the same order dated 15-12-1987, the Assistant Collector decided classification under sub-heading 3920.31 and Collector (Appeals) decided the classification under sub-heading 4811.39. So, the appellant has preferred this appeal and the Revenue has preferred Appeal No. E/472/89-C seeking restoration of the order-in-original.
16. In Appeal No. E/1070/89-C, the appellant - M/s. Sun Lame (P) Ltd. (Sun-lame in short) manufacturing the similar 'product' had also filed revised classification list on 11-11-1986 and had also submitted a letter stating that pending approval of the said revised classification list, the appellant would continue to pay duty under protest. Assistant Collector issued a show-cause notice as to why the protest should not be rejected. At the time of personal hearing, the appellant contended in writing that as their protest was based upon their demand for revising classification, the question of revised classification might also be taken up and that they waive right of show cause notice for the purpose. On adjudication, the Assistant Collector classified the 'product' under subheading 3920.31 and rejected the protest letter vide order No. 92/1988. The appellant went in appeal and the Collector (Appeals) rejected the appeal. So, the appellant has preferred this appeal seeking classification under sub-heading 4818.90 and other consequential reliefs.
17. All the manufacturers, concerned in this group of appeals, are manufacturing paper-based decorative laminated sheets. In all cases, the process of manufacture is such that it requires chemicals, namely, phenol and formaldehyde, melamine and methanol, and other important raw-material required is paper. First, the mixture of the above chemicals is prepared which is put into tray also known as tub and the paper is passed through it. This is the method of applying the mixture on the paper. The paper on which the mixture is so applied, is, thereafter, passed through a drying chamber and as a result thereof impregnated paper comes into existence. Thereafter, the paper is cut into sizes. Such sized pieces are taken into flat dyes in required bunches and is pressed in a hydraulic press so as to apply heavy pressure at a selected temperature for a fixed period. As a result thereof, on application of pressure and heat the bunch of impregnated paper pieces get bonded in a single sheet. This sheet is, thereafter, subjected to process of cutting and sanding to make it marketable in required length and widths. It is contended and admitted and not challenged by the Revenue that the impregnated paper which comes into existence at intermediate level is considered excisable but by Tariff Advice No. 2/84 dated 12-1-1984. CBEC has held it to be converted type of paper and exempt from payment of C.E.D.
18. Now, in all the orders-in-original, this process of 'product' is discussed in varying degree and manner but the process, narrated above, is accepted by all. In appeals, preferred by the Revenue also, this process is not in dispute. On 4-5-1989, L.A., Shri D.A. Dave, appearing for Meghdev & Label, led arguments for the appellants and made following submissions:
That until Central Excise Tariff Act, 1985 (Act No. 5 of 1986) came into effect from 28-2-1986, the 'product' of the manufacturers was classified under T.I. 68 of the old Tariff. The Revenue had claimed to classify it under T.I. 15A(2), but in Collector of Central Excise, Ahmedabad v. Melamine Fibre Board Ltd. and Ors. - 1988 (36) E.L.T. 139 (Tri.), it was held that such 'product' is assessable under T.I. 68 and not T.I. 15A(2) as claimed by the Revenue. Process of the 'product', in question, has been briefly described in para 2 of the said order and Shri Dave submitted that the process is identical with the process of the 'product', in question. He also pointed out that in that case reliance has been placed on judgment of Hon'ble Supreme Court in Jeep Flash Light Industries Ltd. v. Union of India and Ors. - 1985 (22) E.L.T. 3 wherein the Hon'ble Supreme Court has clearly laid down as under :
"Articles made of plastic meaning article made wholly of commodity commercially known as plastics and not articles made from plastic alongwith other materials".
He also submitted that the guidelines laid down by the Hon'ble Supreme Court were with reference to interpretation of T.I. 15A(2) vis-a-vis T.I. 68. Shri Dave also submitted that the Tribunal has also based its decision on the fact that the paper in the 'product' was more by weight than resin (vide para 10). He also cited Amit Polymers and Composites Ltd., Hyderabad v. C.C.E., Hyderabad - 1989 (20) ECR 454 (CEGAT) wherein similar issue had arisen and after detailed analysis, the Tribunal has held that the 'product' (decorative laminated sheets) is classifiable under sub-heading 4818.90. He pointed out that in that, case also, the 'product' was identical and process of manufacture was the same and reliance was placed upon Jeep Flashlight Industries Ltd. (supra). He pointed out that in that case also, the adjudicating authority had classified the 'product' under Heading 3920.31 and the Collector (Appeals) had ordered classification under Heading 4811.39 and that 'product' had 30 to 40% resin and the rest was paper as is the case in the present appeals. So, Shri Dave submitted that this being the issue decided against the Revenue, the present appeals should be allowed. He submitted that the product, in question, in the present appeals also should be classified under subheading 4818.90, till 28-2-1988 and after that date, consequent upon the amendment in the tariff entries, the 'product' should be classified under sub-heading 4823.90.
20. Shri Dave also referred to Orders No. 52-54/89-C in Appeal No. E/219/87-C and other appeals in C.C.E., Ahmedabad v. Metro Wood Engineering Works and Ors. (Trib.) and submitted that therein the 'product' in question, was industrial laminates (electrical insulators) and classification under T.I. 8546.00, decided by the Collector (Appeals), was upheld by the Tribunal and the classification under Tariff Heading 2930.31, decided by the Assistant Collector, was held to be incorrect. He also submitted that therein also, contention of the Revenue was that laminated products with other materials should have been classified under T.I. 3920.31, but that contention did not find favour with the Tribunal.
21. Learned Consultant, Shri Trivedi (for Meghdoot), adopted the above arguments and also reiterated all the contentions raised by the assessee in their letter dated 3-3-1988 addressed to the Collector of Central Excise (Appeals), a copy of which is produced at pages 46 & 47 of the Paper Book in Appeal No. E-2962/88-C. In brief, in the said letter, process of manufacture is described and is further stated that first impregnated paper comes into existence which has been considered excisable but not chargeable to duty by the CBEC and that such impregnated paper is used as input in the manufacture of 'product'. It is, further, contended that the 'product' was the article of paper and not of plastic.
22. L.A., Shri V.K. Bhatt arguing for L.A., Shri Nanavati for M/s. Viral & Others, submitted that in subsequent appeals, the Collector (Appeals) has followed the decision in the case of M/s. Amit Polymers (Supra) and so the Revenue has accepted this position and this appeal should be allowed.
23. L.A., Shri Sharma for 'Shree' and L.A. Shri Agarwal for "Milton & Decent' also adopted the above arguments advanced by Shri Dave.
24. Arguments were resumed on 26-5-1989 and Shri A.S. Sunder Rajan, Ld. D.R. made following submissions on behalf of the Revenue :
In Appeal No. E/2962/88-C (Meghdoot), in Order-in-Appeal (internal page 4), the Collector has, specifically, held that "thickness of plastic layer is more than 1/2 of the total thickness of the final product. Thus, classification of the impugned product under Chapter 48 is out of question". This is a finding of fact and is not challenged in the appeal. The appellant had sought to rely upon the Order-in-Appeal No. 254/87 dated 30-9-1987 passed by the Collector (Appeals), Madras in the matter of M/s. Amit Polymers (supra) in their appeal before the Collector (Appeals), but the Collector (Appeals) could not have placed any reliance upon it because in that order there is no discussion of facts and no reasoning is advanced for coming to the conclusion that the classification should be under heading 4811. It would suggest that there was non-application of mind and so, no arguments can be based upon that order.
25. In Appeal No. E/3311/88-C (Label), in Order-in-Appeal, the Collector has reproduced, at length, discussion in the Order-in-Original. In para 7.5 of the impugned order, the Collector has held "it will be observed that none of the processes, mentioned above, are involved in the manufacture of the subject goods." According to the D.R., this finding is totally erroneous because as far as the 'product' is concerned, all the three requirements of Chapter Note 1 of Chapter 39 of GET are satisfied because after polymerisation and under external influence, heat and pressure and by moulding the 'product' emerges into shape which is retained on removal of the external influence. So, according to him, the observation in the impugned order of the Collector that the processes, mentioned in note 1 of Chapter 39, have not 'admittedly' been carried out, is not correct because there was no admission on the part of the department to this effect. Reliance placed upon the findings of the Collector (Appeals), Madras, is also not proper because there are no findings in the order under reference (as stated above). Reference to Explanatory Notes to Financial Budget 1988 is also not correct and out of context. Contention at page 10 of the Appeal Memo, that the final 'product' that emerges is paper based laminates is not correct. By any scientific or technical method, the 'product' cannot come under Chapter 48 as the 'product' is not article of paper and so classification decided by the Collector (Appeals) is erroneous and classification made by the Assistant Collector is correct.
26. In Appeal No. E/3521/88-C (Meghdev), the impugned order is identical with the Order in Appeal No. E/3311/88-C, so, same arguments will apply. So, impugned orders in the appeals of 'Label' and 'Meghdev' are erroneous on findings of facts and cannot be sustained. So, the appeals of the Revenue should be allowed and appellant's appeals should be dismissed.
27. In Appeal No. E/1240/89-C, order of remand passed by the Collector (Appeals) is not proper and appeal should have been dismissed,
28. In Appeal No. E/267/89-C (Milton), according to Ld. D.R. in Order-in-original (at internal pages 8 & 9), process of 'product' is discussed and break-up of 9 raw-materials (which go into the production of the 'product' in question), is given and the total of first three comes to 1.862 kgs. while the total of remaining raw-materials comes to 2.01 kgs. and so the total of first three raw-materials, which are paper or allied 'products' is less than the total of chemicals like Melamine, Formaldehyde, etc. and so the paper used is less in weight and so the process is of polymeristation. The findings of the Assistant Collector are in detail and these findings of facts are not controverted in the impugned order passed by the Collector (Appeals). Specific finding of the Assistant Collector that paper is not dominating material by weight, is not controverted and the observation that "bulk of the raw-material comprises of paper" is not substantiated by any argument. Observation that none of the processes of polymerisation are put into use by the appellant, is not correct in view of the discussion in the Order-in-original. Reliance placed upon Orders-in-Appeal passed by the Collectors of Central Excise (Appeals), Madras and Bombay is not proper.
29. In Appeal No. E/234/89-C (Shree), the impugned order is correct one and it has been rightly held to be a 'product' of polymerisation.
30. In Appeal No. E/332/89-C & 471/89-C (Decent) - Same arguments as in the case of Appeal No. 276/89-C (Milton) are applicable.
31. Ld. D.R. also made following submissions with regard to all appeals : Decision in Amit Polymers' case [1989 (39) ELT 674] is not proper because it is based upon order-in-appeal which was perfunctory and non-speaking and it should have been set aside and Order-in-Original should have been restored. He submitted that in para 3 of the said Order, wherein, the process of manufacture of the appellant's goods has been described as under :
"They have further stated that in the finished 'product' 30-40 per cent is represented by resin and the rest is by paper, by weight and thickness" which is not correct.
He also contended that in para 9, finding that "admittedly, paper constitutes 60-70 per cent of the finished 'product' by weight as well as thickness and balance 30-40 per cent is resin" is not correct and he, further, submitted that even if this was so, then also that is not the criteria to decide whether the 'product', in question, will be classified under Chapter 39 as an article of plastic because in that case 80% of the products will go out of Chapter 39. He, further, contended that conclusion drawn by the Tribunal that plastics constituted 30-40 per cent only i.e. half of the finished product by thickness was not correct because by polymerisation, identity of the 'product' is lost and so it is never possible to find out proportion of paper and resin in thickness and in weight. As far as the 'product' of the appellant was concerned, it was a process of polymerisation and it should have been classified under Chapter 39 and other constituent materials could not decide classification. He contended that reliance placed upon interpretative Rule 1 by the Tribunal, as discussed in para 11 of Amit Polymers' case, is not proper and interpretative Rule 3B should have been applied because resin gives essential character to the 'product' in question. He also submitted that under heading 39.20 term 'laminate' is specifically used while under heading 48.11, this term is not utilised. He also contended that uses of the 'product' in question, would also suggest that the 'product' has characteristics of plastics and not of paper. Ld. D.R. tried to distinguish Melamine Fibre Board Ltd. case reported in 1988 (36) E.L.T. 139 (Trib.) contending that in para 8 of the judgment in that case, some facts of M/s. Backelite Hylam case [1986 (24) ELT 643), have been discussed and what plea had been advanced by the Revenue in that case has been discussed. But it was not proper because no chance was given to the Revenue to explain its position. In para 11 of the said judgment, the Tribunal has discussed and has recorded finding regarding character of the 'product' which was not proper and Tribunal of its own, without any assistance of the findings from the lower authorities, should not have recorded such finding of the fact. According to him, ratio of Jeet Flashlight case [1985 (22) E.L.T. 3 (S.C.)] was also not correctly applied therein because in the case of Jeep Flashlight (supra), the issue, in question, was of item 15A(2) and not 15A(1). So, according to him, decision of the Tribunal classifying the 'product' under T.I. 68 in Melamine Fibre Board Ltd. case (supra) was not proper and so no reliance can be placed upon that judgment. He cited Bakelite Hylam Ltd., Hyderabad v. C.C.E., Hyderabad in 1985 (22) E.L.T. 879 (Trib.) and contended that in the said judgment, the Tribunal has observed that Jeep Flashlight Case (supra) is not binding in cases similar to those in appeals because, therein, also and here also, facts are different; (on perusal of the said judgment, we note that argument advanced by D.R. is not correct because therein both the parties took different stand regarding application of the said decision and what the Tribunal held was as under :
"While the former has urged that the ratio of the Hon'ble Supreme Court does not apply to the present goods, the latter urges that it does. We, however, think the present dispute can be resolved without going into this debate, so submissions made by the D.R. are not factually correct."
32. Ld. D.R. then referred to Chetna Poly Coats Pvt. Ltd. v. C. C.E. reported in 1988 (37) E.L.T. 253 and submitted that in the said judgment, the Tribunal has held that the 'product' in question, in that appeal, namely, Electrical Insulation Tapes, was classifiable under heading 85.46 and sub-heading 8546.00 (under CET 1985) and not under heading 39.19 sub-heading 3919.00 and for this, the Tribunal has relied upon the decision in the case of M/s. Bakelite Hylam Ltd. (supra). Even though, as per the D.R., the 'product' in Bakelite Hylam Ltd. (supra) was different from that in the case of M/s. Chetna Poly Coats Pvt. Ltd. (supra) and so, in his opinion, the decision of the Tribunal in the case of Chetna Poly Coats Pvt. Ltd. is also not proper and ratio of that judgment will not help the appellant (we have perused the judgment in Chetna Poly Coats Pvt. Ltd. and we understand that the Bench has followed reasoning of the Tribunal in the Bakelite Hylam case while specifically noting in the order itself in para 11 that 'product' in both the cases was different. So, in our view, contention raised by the Ld. D.R. is not proper.
33. The Ld. D.R. then referred to M/s. Formica India Ltd. Order No. 467/87-C in Appeal No. ED/SB/1217/83-C wherein the Tribunal has held that the 'product' ("Industrial Laminates insulating grade) would fall under T.I. 68 and not under T.I. 15A(2) after the amendment of Tariff Item 15A (as both the items stood at relevant time) and contended that this order cannot be brought in for support by the appellants because in that case there is no discussion why the 'product', in question, could be covered by T.I. 68 and not T.I. 15A(2)? (We have perused that judgment also and we find that the Bench has discussed, at length, as to how the 'product', in question, as "Electric Insulator". Moreover, the reliance has been placed upon M/s. Bakelite Hylam (P) Ltd. (supra). So, it is obvious that while reliance is placed upon earlier order of the Tribunal, it is not necessary for the Bench to recite all the arguments advanced by both the sides and meet with them. It is also not necessary to discuss process of manufacture, character, end use, etc. unless some difference is pointed or if it is not clear as to how earlier order would apply to the case in hand. So, we are of the opinion that the contention raised by the Ld. D.R. regarding this judgment is also not proper.
34. The Ld. D.R. then referred to C. C.E., Ahmedabad v. Metro Wood Engineering Works and Ors. orders No. 52-54/89-C in Appeals No. E/219/87-C and others and submitted that in that order also reliance placed upon Bakelite Hylam (P) Ltd. (supra) was not proper and that the order is "per incurium". He further submitted that reliance placed upon order in this case in Amit Polymers' case (supra) was not proper and so decision in Amit Polymers' case (supra) was not proper and it does not help the appellants. Now, we have carefully perused this order in C.C.E. v. Metro Wood (supra) and we find that the Bench speaking through Sh. D.C. Mandal, Member (Technical) has elaborately discussed different tariff items, different decisions, scheme of the new Central Excise Tariff introduced in 1985 and interpretative rules. It is also discussed therein meaning of the word "insulator" and various technical books have been referred to. So, we are unable to accept the contention of the D.R. that the order would be improper as being devoid of discussion of any relevant issue. An order can be termed "per incurium" if any provision of law or binding judicial pronouncement has been overlooked or not followed. The Ld. D.R. has not been able to cite any such provision of law or judicial pronouncement, which has been not followed in the said order. So, we are unable to appreciate how the said order can be termed "per incurium". So, contention of the D.R. regarding this judgment is also, in our view, not proper.
35. D.R. cited following authorities in support of the appeals by the Revenue :
(i) C.C., Bombay v. Wash Udyog in 1987 (31) ELT 73 (Trib.). In this case, the respondent (assessee) had imported "class E & other high temperature insulating paper" which were classified for the purpose of C.V. Duty, under Item 17(2) of the CET (as it then existed) on the ground that the goods consisted of presspahn paper board laminated with polyester film. The asses-see applied for refund contending that the goods were classifiable under Chapter 48 CTA. The Assistant Collector rejected the claim and the assessee succeeded in appeal. So, the Revenue preferred the appeal and the Tribunal held as under :
"Presspahn paper or board is not capable of giving insulation of such high degree. Such high degree of insulation in E class material comes only from the plastic film portion of the goods. Without the plastic film portion, the goods do not become E class, even though impregnated presspahn paper or board, by itself, is also an insulating material. We have, therefore, no doubt in our mind that in the composite material, the essential characteristics of E class electric insulation come from the plastic portion rather than the paper backing. Since classification of the composite goods, in the absence of specific heading for such goods has to be determined on the basis of Rule 3(b) of the Rules for Interpretation of the Tariff which required that such goods shall be classified as if they consisted of the material or component which gives the goods their essential character insofar as this criterion is applicable, classification under Heading 39.01/06 would have to be preferred to classification under Chapter 48 CTA."
36. The Ld. D.R. submitted that in that case paper portion was 10 mils, and the plastic portion was only one mil. and the Tribunal has held in para 5 "thus, it is not the bulk, but the property of giving the essential character applicable to the case before us". This order is dated 24-6-1983.
37. (ii) Indian Telephone Industries, Madras v. Collector of Customs, Madras Order No. 128/83-C in Appeal No. CB/SB/T/134/79-C. In this case, the appellant imported "bakelite phenolic paper laminates" and the same were classified under T.I. ISA of GET (as it then existed), for the purpose of C.V. Duty. The importer applied for refund and subsequently, when the matter came up in Appeal and it was submitted by the appellant importer that the material was an insulating material formed by paper sheets, impregnated with synthetic resin, polymers under pressure and temperature to form insoluble and infusible mass and it was contended that the synthetic resin was used only to cement the super imposed paper sheet, the Tribunal has held as under"
"To us, it appears that seldom would an article be made only of plastic or synthetic resins, a minor part like Screw or bolt or some fittings may be made of material which is (not) synthetic resins or plastic. In the circumstances of the case, paper has a very minor role to play in the goods imported. The plastic is laminated over paper. The essential character of the imported goods is that of synthetic resins or plastics. Viewed thus, it would appear that a Tariff Item ISA of the Central Excise Tariff was rightly applied to the goods in question."
(iii) Bakelite Hylam Ltd., Hyderabad and Ors. v. C.C.E., Hyderabad and Ors. - 1986 (24) ELT 643 (Trib.) In this case the issue was of classification of Prepeg 'P', 'C & 'G'. In this case, three thermosetting stages of resin during the process of setting were considered as per the definition in the book "Dictionary of Plastics" by J.A. Wordinghan & P Reboul 1964 edition and as per that definition these are stages -"A = Stage" (Resol Stage), "B-Stage" (Resitol Stage) and "C-Stage" (Resite Stage) and it is stated therein that after A-Stage, such resin is used for impregnating paper and fabrics for laminating. It has been held by the Tribunal that the impregnated cotton fabrics, under reference, answered to the description of term 'cotton fabrics' as set out in Tariff Item 19 (as it then existed) of the C.E.T. In para 17, it has been observed that the impregnated fabrics, under reference, were flexible and they can be bent without tear. Impregnation of phenol formaldehyde, by itself, could not take fabrics out of the purview of Item 19 CET". Ld. D.R. relied upon the definition and emphasised the fact that even if the first stage of thermosetting is reached, the resin would result.
iv) C.C.E. v. Jay Enterprises and Ors. - 1987 (29) E.L.T. 288 (Trib.). - Ld. D.R. cited this judgment to show that stages of manufacture of phenol formaldehyde resin taken note of in the case of M/s. Bakelite Hylam (supra) has been reproduced and it is stated that A-Stage resins are used for impregnating papers and fabrics for laminating. He, further, contended that the manufacturer in that case was manufacturing laminated sheets and the question was whether production of Resole at an intermediate stage was excisable and in discussion, it has been stated as under :
"As we have observed in the case of Bakelite Hylam and it was admitted position in that case that for the laminated sheets to be manufactured the phenolic resin has necessarily to be taken in the process of manufacture from A to B and then to other stage of polymerisation."
v) Bakelite Hylam Ltd., Bombay and Ors. v. C. C., Bombay and Ors. - 1986 (25) E.L.T. 240 (Trib.) Here, the issue was of classification of press plates for producing plastic laminates and whether it should be classified as moulds under Heading 84.60 of the Customs Tariff Act, 1975 or as stainless steel under Heading 73.15 ibid. In para 42 of the said judgment, it has been stated as under :
"During the process, the sheets to be bonded are held between two press plates and under the pressure and the heat, the resin flows, causing the different individual impregnated kraft papers to bind together permanently into thick industrial sheets. The sheets are held in place by the press plates till they are fully cured and the resin is permanently set in an irreversible process. This process of laminating sheets together to form thicker sheets is used to produce both decorative plastic laminates as well as sheets for industrial and other utility purposes."
38. In para 43, some technical literature has been referred to and therein there is a paragraph as under :
"It seems that the book recognises that lamination process is a process of moulding. In PLASTIC MOULDING TECHNIQUE (by D.A. Dearie) there is this sentence at page 93.
"The process of molding laminated phenolic sheets, rods, and tubes is a study in itself, differing from compound molding both in technique and in the types of presses used. In our study of the phenolics we learned that the molding compound consisted chiefly of a binder and a filler, the binder being a phenolic resin and the filler consisting of wood flour or some other such product. The same is true of the laminates, except that the filler is either a paper or cloth, not a flour."
39. So, according to the D.R. as per above judgments, process of lamination is akin to process of plastic industries. What is done is process of polymerisation and mould is prepared consisting of resin and filler (in this case paper). So the final 'product is the plastic sheets.
40. He, then referred us to definition and characteristics of laminates in Encyclopaedia of Chemical Technology by Kirk and Othmer Vol. 17 at page 406. He also referred to Encyclopaedia of Polymers Science and Technology Vol. 8 to various pages therein and, especially, at pages 152 and 153 wherein it has been stated that laminates have more characteristics of plastic than paper. He, then, referred to pages 558 and 559 of Vol. 10 of the said Encyclopaedia wherein it has been stated that "In the industrial laminate resin content will differ from 29-70%". He submitted that if the percentage of thickness and weight of resin are to be considered for deciding classification, then the department would be busy doing that work only and it would entail enormous and unending drudgery. So, according to him, instead of this formula, characteristics of the 'product' and its end-use must be taken into consideration.
41. He, further, submitted that as, in his view, Amit Polymers' case (supra) is not properly decided as the different judgments referred to by him as above, have not been taken into consideration by the Tribunal and as earlier the Tribunal has taken different view (more particularly, in the case of Indian Telephone Industries, Wash Udyog, Jay Enterprises, etc.) and as, in his view, there is a conflict of decisions, the matter should be referred to the Larger Bench of the Tribunal.
42. In reply, L.A., Shri Dave submitted that once the Bench has pronounced considered opinion, then normally, it should be followed unless some serious lacuna is pointed out or on the face of it, the order is perverse, not based upon the facts on record or position of law as can be culled out from provisions of statutes or judicial pronouncements. This is a question of judicial discipline also. He cited Shri Prehlad Singh v. Union of India and Ors.' Judgments -1989 (2) (S.C.) 270, wherein it is observed as under:
"We think it desirable that in cases of such as this the Court should formulate a set of appropriate guidelines indicating when directions by the Court in one particular case can be regarded as operative in other cases."
He submitted that this is imperative in any judicial system and this Tribunal should also follow this principle otherwise efficacy of system will be jeopardised. He, further, submitted that in ITI case (supra), 'product' was different and process is not known and weight of paper was not considered. All facts are also not known and moreover it was customs' case; so, it can have no application to the present appeals.
43. Ld. Advocate referred to order in Appeal No. E/3311/88 (Label) and referred to page 8 wherein the Collector (Appeals) has discussed survey report issued by Therapatics Chemical Research Corporation in favour of M/s. Label Laminates and test certificate from L.D. Eng. College, in the case of M/s. Meghdev Enterprises wherein it is observed that thickness of paper in each layer and also in the finished 'product' is more than 50% of the total thickness and so, the Collector has, further held that the 'product' would be excluded from Chapter 39 and would fall under Chapter 48. The Revenue in Appeals Nos. E/3522/88 and E/3521/88 have not challenged this finding. According to him, in fact, the Revenue have not challenged this aspect at all in any appeal and Revenue's challenge to the classification is not based on this aspect. He, further submitted that contention raised by the Ld. D.R. for the Revenue was also raised by him in Melamine Fibre Board Ltd. case (supra) also and was not accepted by the Tribunal. So re-agitating the same arguments should not be permitted. As far as technical literatures are concerned, that was also referred to in Melamine Fibre Board Ltd. case (supra) and not relied upon. In Melamine Fibre Board case (supra), all the arguments raised by the Revenue were negatived and a detailed order was passed meeting with all the contentions raised by the D.R. In Amit Polymers' case (supra), reliance was placed upon Melamine Fibre Board Ltd. case (supra) and so all these appeals should be decided in the light of Amit Polymers' case (supra).
44. L.A., Shri Tripathi (for Meghdoot) submitted that conclusion "thickness of plastic layer is more than 1/2 of the total thickness of the final product" by the Collector (Appeals) in order-in-appeal (in the final para) is not correct and is not based upon facts on record. He referred us to para 9 (page 22 of the paper book) of the assessee's reply to the Assistant Collector wherein it is stated that "in the case of declared goods, the paper pre-dominates in weight in the final article of paper". Then he referred us to paras 9 and 1.0 of the order-in-original wherein process is discussed by the Assistant Collector, but that he has not disputed the contention raised by the appellant that the paper is more in weight. So, according to L.A., Shri Tripathi, the contention raised by the D.R. regarding paper being less in weight in the final 'product' is not correct as is not borne out from the facts on record. He also drew our attention to appeal memo preferred before the Collector (Appeals) by the appellant, copy of which is produced at pages 32-40 of the paper book and pointed out that at page 30, it is specifically stated as under :
"Appellant says that while replying to the notice, the appellant has stated that out of numerous materials used in the manufacture of paper-based decorative laminated sheets, the use of paper was in pre-dominance by weight".
"The impugned order does not dispute the fact that use of paper in the manufacture of paper-based DLS was in pre-dominance and therefore, the appellant request to take into account this undisputed fact while deciding the appeal petition".
45. L.A., Shri Agarwal (for Milton), submitted that Assistant Collector has listed different materials which are being used in the manufacture of the 'product' at page 9 of the order-in-original. But the last raw-material, namely, ordinary denatured spirit/methanol, ultimately evaporates and so in the final 'product', the paper is 70% while other raw-materials are 30%. He, further, contended that the Assistant Collector in his order-in-original has nowhere stated that the chemicals are more in weight than the paper. He also drew our attention to the order-in-appeal wherein it is stated (at internal page 2) that "it is indicated in the impugned order that the Assistant Collector, the Central Excise Division II, Ahmedabad had filed an affidavit before the Hon'ble High Court of Gujarat wherein he had given the details of the raw-materials for the manufacture of the goods". Thereafter, the arguments are listed and process is stated. Thereafter it is stated at page 3 of the said order as under:
"From the details of the raw-materials used and the process of manufacture, it can be observed that bulk of the raw-material comprises of paper".
So, according to Shri Agarwal, L.A., this is a definite finding and is not challenged by the Revenue in Appeals No. E/410/89 and E/471/89 (Milton and Decent). He also mentioned that the Assistant Collector himself has in affidavit filed before the Gujarat High Court, admitted the process and composition of the raw-materials and so there is no dispute about the both. He, further, submitted that during the process of mixing chemicals with the paper i.e. during the process of impregnation, there is no process of polymerisation taking place, but it is the process of curing and for this, relied upon observation at page 293 of 'Condensed Chemical Dictionary by G.G. Hawley (10th Edition). He also referred to definition of polymerisation at page 853 of Chambers Dictionary of Science and Technology.
46. Shri Sharma, Ld. Consultant (for Shree) referred to a letter of the Superintendent (C.E.), copy of which is produced at annexure 'E' (page 16 of the paper book) wherein report of the Chemical Analyser is reproduced and wherein it is stated as under:
"It has the characteristic of phenolic resin bonded sheet based on Cellulosic paper".
So, according to him, the basis is paper and so the classification, as claimed by the appellant, should be accepted.
47. In Appeal No. E/1240/89, L.A., Shri Dave submitted that the order of the Collector (Appeals) remanding the matter of refund claim back to the Assistant Collector based on order of classification of the 'product' under sub-heading 4811.39, is not correct and that the 'product' may be classified as per the submission of the appellant and in light of that, consequential relief be granted.
48. On 14-6-1989, L.A., Sh. S.I. Nanavati (for Viral, Jay Sundek and Vishnagar) adopted the arguments advanced by L.A., Shri Dave and submitted that in Appeal No. E/1271/89, Collector (Appeals) has, in his order-in-appeal (page 2), listed the raw-materials and also the process of the 'product'. He submitted that there is no challenge to this. He, further, submitted that this decision was given before the Tribunal decided Amit Polymers case (supra). Subsequently, he decided six appeals and decided classification as decided in Amit Polymer's case (supra). He submitted that the raw-matrials used and process, narrated in this order-in-appeal, are the same as in the Amit Polymers' case (supra).
49. Ld. D.R., in reply, admitted that there is no dispute regarding raw-materials and process, but he submitted that weight of paper in the end-product cannot be determined and that there is error of judgment committed by this Tribunal in Amit Polymers' case (supra). He reiterated all the arguments advanced by him earlier. He also submitted that product cannot be folded and so it has the character of plastic sheet and not of paper. He, further, submitted that as per Chapter note 2(f) of Chapter 48 of CET, except wall coverings, all other articles, wherever there is any use of plastics, are covered under Chapter 39 of CET. In this connection, he referred to Explanatory Notes to Chapter 39 of Harmonized Commodity Description and Coding System (HCN). He referred us to note "combinations of plastics and materials other than textiles" at page 554-555 wherein item (d) reads as under :
"This chapter also covers the following products whether they have been obtained by a single operation or by a number of successive operations provided that they retain the essential character of articles of plastics".
(d) products consisting of glass fibres or sheets of paper, impregnated with plastics and compressed together, provided they have a hard, rigid character", (if having more the character of paper or of articles of glass fibres, they are classified in Chapter 48 or 70, as the case may be).
Then he referred us to note below heading 39.26 at page 575 of the same Explanatory Notes wherein it is stated that this heading covers articles which include those mentioned at Sl. No. 1 to 10 thereunder.
50. In reply, L.A., Sh. Nanavati submitted that if the 'product' is delaminated layer of papers used therein can be used again and so the 'product' is character of paper and not of plastics. He also submitted that paper does not lose the identity even after lamination.
51. As discussed above, regarding some impugned orders, valid contention can be raised that either they are not speaking orders or that they are not properly reasoned one or that in some orders, Collector (Appeals) concerned, has relied upon order passed by some other Collector (Appeals) and that is how there is non-application of mind. But as we have stated at the outset, there is no dispute about the process of manufacture of the 'product' in all these appeals and so, ultimately, the issue is whether it should be classified as prayed by the appellants (manufacturers) or as prayed by the Revenue. So, L. As., appearing for the manufacturers, have submitted that the appeals or any of them may not be remanded on the ground that the impugned order is not speaking one or on any other ground but that it may be decided on merits as facts can be easily ascertained from the record and there is no dispute about the process or the resultant product.
52. In Melamine Fibre Board Ltd. (supra), this Tribunal has held that the product paper-based laminated sheet was classifiable under T.I. 68 (as it then stood). Therein also, the product was more or less the similar to 'product' with which we are concerned in these appeals. Therein also, as in these appeals, the process was almost identical and the paper content by weight was more than resin content. The Revenue had raised almost same arguments as raised in these appeals and they were negatived.
53. In Amit Polymers' case (supra) also, the product was the same as in these appeals and process was also the same as can be seen from para 3 of the said judgment. Therein also, the Revenue has sought to rely upon scientific literature which is also produced before us in these appeals. The Revenue had also contended in that appeal that the product has essential characteristic of plastic and so classification should be governed by interpretative Rule 3B. Reliance was also sought to be placed upon Chapter Note 1 of Chapter 39 of C.E.T. of 1985. But after discussing all these arguments, the Tribunal negatived all the arguments advanced by the Revenue and held that the 'product', in question, was classifiable under heading 4818.90. We see no reason to depart from this decision.
54. Still however, we, briefly, meet with the arguments advanced by the Ld. D.R. regarding each appeal and thereafter the general arguments.
55. In Appeal No. E/2962/88C (Meghdoot) in the impugned order, the Collector has held that "thickness of plastic layer is more than 1/2 of the total thickness of the final product". He has based his observation upon record of the adjudication proceedings. Now, on perusal of order-in-original, we do not find such finding recorded by the Assistant Collector. The appellant has also, nowhere, made such statement in reply to show cause notice. So, findings recorded by the Collector (Appeals) are, obviously, without any basis. The Ld. D.R. has not been able to produce any evidence to show us on which basis the Collector (Appeals) has come to this conclusion. The appellant has also, in ground 4 of the appeal memo, specifically contended that this observation made by the Collector (Appeals) is of his own without any supporting evidence available in the record of proceedings. So, in our view, the contention of Ld. D.R. that this finding of fact by the Collector (Appeals) has assured finality, is not correct.
57. Regarding Appeal No. E.3311/88C (Label), Ld. D.R. has contended that in the impugned order observation "none of the processes, mentioned above, are involved in the manufacture of subject goods", is not correct because, in his view, even at the end of first stage i.e. 'A' stage there is polymerisation and thereafter there is moulding under external influence, heat and pressure, and 'product' emerges into shape, which is retained on the removal of the external influence. In our view, this is a process whereby plastic product can emerge, but that does not necessarily mean that through this product, what would emerge, would necessarily be plastic product.
58. Regarding E/267/89C (Milton), the contention of the Ld. D.R. that total of chemicals used as raw-materials, is more than total of paper used in the final product, as raw-materials, is also not correct as explained by L.A. Shri Aggarwal. D.R's contention about specific finding of the Assistant Collector that paper is not dominating material by weight is also not correct because the Assistant Collector has, nowhere, said so, but on the contrary what he has stated that the predominance of any material, is not correct criteria for deciding classification.
59. Ld. D.R.'s contention that decision in Amit Polymers' case (supra) based upon order-in-appeal, which itself was perfunctory and non-speaking and that is why not proper, is not correct. He contended that the finding of the Tribunal, in Amit Polymers' case (supra), that paper content in the product was more than resin content, is not correct has also no basis. We do not know what was the impugned order in that case and on what basis the Tribunal has arrived at the observation which is challenged. The Ld. D.R. did not produce any evidence in support of his contention and we have to accept observations and findings of the Tribunal as recorded in the order. His arguments that in the Amit Polymers' case (supra), the Tribunal has erred in drawing conclusion about the constitution of the product in question by weight and by thickness as it was not possible because after polymerisation, identity of the product would be lost and it would not be possible to do it, is also not acceptable because the Assistant Collector himself has stated break-up of raw-materials and weight of constituent raw-materials can easily be ascertained from it. As far as the question of thickness is concerned, the Tribunal might have based finding upon authorised sample or on any other material. In the appeals also, the Ld. D.R. has not produced any material to show that in fact relative thickness of different raw-materials cannot be ascertained while in appeals of Label and Meghdev, there are certificates issued by proper authorities about thickness of paper being ascertained. So, this contention of Ld. D.R. has also no force. His contention regarding reliance placed upon interpretative Rule 1 by the Tribunal is also not correct and we do not find anything wrong in invoking Rule 1 and we fully endorse the arguments advanced in the said judgment.
60. It is Ld. D.R.'s. contention that in para 8 of the judgment in C.C.E., Ahmedabad v. Melamine Fibre Board Ltd. and Ors., (supra), discussion by the Bench about the plea taken by the Revenue in M/s. Bakelite Hylam case (supra) was not correct because, according to the Ld. D.R., this was done without giving the revenue a chance to explain that position. But, in our view, this contention is also not valid because Bakelite Hylam case is a reported case and reliance can always be placed upon what has been stated therein. He also contended that, in para 11, final conclusion drawn by the Bench regarding character of the product was not proper in as far as without assistance of the findings of the lower authority, it should not have been done. This argument also, we are unable to accept because we do not know what record was available to that Bench at the relevant time and what assistance the Bench could derive from the assessee during hearing? Moreover, it is open to Bench to reach to a conclusion based upon facts on record, technical literature available and also upon subjective observation of the members concerned. So, we do not agree with the Ld. D.R. that the said judgment can be distinguished as submitted by him.
61. Ld. D.R.'s contentions regarding Chetna Poly Coats' case (supra), M/s. Formica India Ltd. (supra) and M/s. Metro Wood Engineering Works & Others, we have already dealt with above.
62. In Wash Udyog case (supra), the Tribunal decided classification of the product, in question, under Chapter 39, because as per the excerpted paragraph from the said judgment above, the Tribunal concluded that insulation in 'E' class material comes from the plastic film portion of the goods. So, the decision of the Tribunal was in particular context. It is true that in Indian Telephone Industries case (supra), the Tribunal has taken a view that product "Bakelite phenolic paper laminates" were classifiable under T.I. 15A (as it then existed) because the goods which were imported had an essential character that of synthetic resin or plastic. The Tribunal has, subsequently, in Metro Wood case (supra), Melamine Fibre Board case (supra) and Amit Polymers' case (supra), has taken a different view and we decide to follow that and so this order in ITI case (supra) which was decided on 20-4-83 and judgment in the case of Wash Udyog, which is dated 24-6-1983, are earlier order as so they do not come in the way of the manufacturers who are in appeal before us.
62A. Ld. D.R. cited C. C.E. v. Jai Enterprises (supra) to show that even when the first stage is reached out of the three stages in thermosetting stages, resin results. Therein also, it has been held that for manufacture of laminated sheets, phenolic resin has necessarily been taken from 'A' to 'B' stage and then to other stage of polymerisation. He has also cited Bakelite Hylam Ltd., Hyderabad case (supra) to show that even if the first stage of thermosetting is reached, the resin would result and also to support his contention that after 'A' stage, resin is used for impregnating paper and fabrics for laminating. He relied upon Bakelite Hylam Ltd. case - 1986 (25) ELT 240, to contend that kraft papers are impregnated by the resin and bound together permanently into a thick industrial sheet and after curing resin is permanently set in irreversible process. Relying upon these, he contended that the final product is a moulded one with resin and it has all characteristics of plastic material. In Amit Polymers' case (supra), this argument was advanced by Shri Doiphode, Ld. JDR for the Revenue which can be seen from para six of the said order and it has been negatived in para 9 of the judgment. So, we need not to repeat these arguments here.
63. Technical literature, relied upon by the Ld. D.R., was also referred to in Amit Polymers' case (supra) by the Revenue and interpretation sought to be put by the Revenue is not accepted. Though, it has not been discussed in appeal, but this aspect was discussed in appeal in Melamine Fibre Board Ltd. case (supra) and the said judgment has been relied upon in Amit Polymer's case (supra).
64. The Ld. D.R. has also contended that in view of the conflict and decisions of this Tribunal, as discussed above, the matter should be referred to Larger Bench; but we are of the view that this Tribunal has taken consistent view in Metro Wood case (supra), Melamine Fibre Board case (supra) and Amit Polymers' case (supra) and reference to Larger Bench is not called for.
65. So, we hold that 'product' of the manufacturers, who are in appeal before us, should be, following decision in Amit Polymers' case (supra) - 1989(39) ELT 674, classified under sub-head 4818.00 till 28-2-1988. Admittedly, the relevant tariff entries were amended w.e.f. 1-3-1988 and heading 4823 has been incorporated as under:
"Other paper, paperboard, cellulose wadding and webs of cellulose fibres, cut to size or shape; other articles of paper pulp, paper, paperboard, cellulose wadding or webs of cellulose fibre."
66. Now, in this heading, there are several sub-headings and sub-heading 4823.90 provides for 'others' and we are of the view that after 1-3-1988, 'product' should rightly fall under this sub-heading 4823.90.
67. Now, we discuss facts of Appeal E/1070/89-C because facts are peculiar and that is why have to be discussed separately. The appellant 'Sunlame' is also manufacturing identical 'product'. Appellant filed classification list No. 2/86-87 dated 2-4-1986 classifying their product under sub-heading 3920.31, which was approved. Appellant was also availing exemption under Notification No. 175/86-C dated 1-3-1986. On 11-11-1986, the appellant filed a revised classification list 3/86-87 claiming classification under sub-heading 4818.90 and also claimed the exemption under Notification No. 175/86-C. In forwarding letter, the appellant also stated that pending approval of the revised classification list, the appellant would continue to pay duty under protest at the earlier rate applicable under sub-heading 3920.31. The Assistant Collector issued a show-cause notice dated 10-2-1987 to show as to why the protest letter should not be rejected. The appellant submitted its reply dated 11-3-1987. The matter was fixed for personal hearing on 12-1-1988 and at that time, the appellant submitted written submissions wherein it was prayed that the show cause notice had been issued only for deciding protest letter but as the issue involved was of revision of classification list, the Assistant Collector was requested to take up the matter of revision of classification also and that the appellant thereby waive the service of another show-cause notice in respect of revised classification list. The Assistant Collector passed a detailed order discussing all the contentions raised by the appellant and also the process of manufacture and raw-materials employed. He also discussed the chemical report. He also discussed scheme of tariff and chapter notes of Chapter 39. In para 5 of the order-in-original, he specifically, stated that the appellant had filed revised classification list No. 3/86-87 classifying their product under sub-heading 4818.90. Thereafter, in three paragraphs, he discussed the technical aspect of the product and thereafter, he referred to some technical books and discussed it in about five paragraphs. Thereafter, he discussed some citations produced by the appellant. He also stated, in para 16, that "there appears to be no cogent reasons, since there is no change in the process of the manufacture, with the party to have a recourse to reopen the classification of the product already done." Thereafter, he stated as under :
"Looking to the aforesaid position, as discussed, the product is correctly classifiable under Chapter 39.
I, therefore, pass the following order :
The 'product' is classifiable under SH : 3920.31 and that the parties' protest, under their letter dated 11-11-1986, is dislodged.
68. The appellant preferred the appeal and the Collector (Appeals) held that "they had subsequently filed another classification list 3/86-87. However, it is not clear as and when it was filed; it is also not clear whether the same has since been finalised by the Assistant Collector". So, the Collector treated the appeal only as pertaining to the protest letter and dismissed the appeal. It can be seen from the discussion in order-in-original, that the Assistant Collector did discuss the contents of the revised classification list and did decide that the 'product' was classifiable under sub-heading 3920.31. So, in fact, he did reject the prayer of the appellant for revising the classification list. So, the stand taken by the Collector that it was not clear whether the Assistant Collector has decided about the revised classification list, is not correct. So, the decision of the Collector (Appeals), by his impugned order, is not correct. He should have given his finding whether prayer for revising classification was proper or not. So, on this account, the appeal could have been remanded back. But, ultimately, the question relates to the correct classification of the 'product', in question, which is admittedly identical with the product which is in question in other appeals and it can also be ascertained from the order-in-original. So, we hold that in the case of this appellant also, the product should be classified as in the case of other appeals. Though, the Assistant Collector has not discussed this aspect, but to make the matter more clear and specific, we observe that the appellant had waived right of another show cause notice and it is perfectly legal and proper. Moreover, it is also noted that the protest letter was also a forwarding letter whereby the appellant had forwarded the revised classification list and this fact is not in dispute. So, the show cause notice should have been issued for both purposes. But even if it was not issued, it would not affect the order which was in effect classifying the product, in question and rejecting the prayer of the appellant for revising the classification.
69. Regarding Appeal No. E/437/89-C (Viral), it is a settled law that the party can challenge classification either by preferring appeal or by filing refund claim and thereby contesting the classification decided by the Central Excise officials. In the present case, the refund claim is being rejected on the basis that the adjudication authority has decided classification under sub-heading 3920.31 and the same has been approved by the Collector (Appeals). The appellant had, along with the refund claim, filed a revised classification list and that claim for revision was rejected by the Assistant Collector vide his order dated 5-3-1987. So, the appellant preferred an appeal which was rejected by the Collector (Appeals) on 7-8-1987. Against the said order, the appellant preferred appeal before CEGAT. Meantime, the Assistant Collector rejected refund claim by his order dated 15-9-1987 even without issuing any show cause notice and without giving any opportunity of personal hearing. So, the order is bad from that point of view also. The refund claim was rejected on the basis that the claim for revision of classification list was rejected by the Assistant Collector and also by the Collector (Appeals). The appellant preferred the appeal against the order of the Assistant Collector, (which dismissed the refund claim) which was registered at No. 2324/87. During the pendency of the said appeal, the special civil application No. 4405/87, filed in the Hon'ble High Court of Gujarat by the Gujarat Laminate Manufacturers' Association, Ah-medabad, wherein the order-in-appeal dated 7-8-1987, passed by the Collector of Appeals', confirming the order-in-original passed by the Assistant Collector on 5-3-1987, whereby he had rejected the application for revising classification list filed by the present appellant, was also in challenge, came up for hearing and the Hon'ble High Court of Gujarat, vide their order dated 16-11-1987, set aside the said order-in-original dated 5-3-1987 passed by the Assistant Collector and also the order-in-appeal dated 7-8-1987. So, the appellant withdrew his appeal pending before C.E.G.A.T. wherein he had challenged order dated 7-8-1987 passed by the Collector (Appeals) as the appeal became infructuous. When the appeal No. 2324/87 came up for hearing, the appellant submitted written submissions. Still, however, on 12-10-1988, the Collector (Appeals) passed an order rejecting the appeal stating that the application for refund of classification list filed has been rejected by the Assistant Collector and the appeal preferred by the appellant is also rejected and so the earlier classification has become final. Now, in light of the discussion, it is clear that both the orders, on the basis of which this appeal has been rejected, have been set aside by the Hon'ble Gujarat High Court by order dated 16-11-1987 passed in special civil application No. 4405/87. So, the impugned order is not proper and requires to be set aside.
70. So, we pass the following final order :
(i) 'Product' manufactured by all the appellants to be classified under subheading 4818.90 upto 28-2-1988 and under sub-heading 4823.90 on and from 1-3-1988.
(ii) In Appeal No. E/2962/88-C (Meghdoot), the impugned order is set aside and relief granted as prayed for.
(iii) In Appeal No. E/3311/88C (Label), the impugned order is modified in terms of above para (i).
(iv) In Appeal No. E/3522/88C (CCE v. Label), the appeal is dismissed.
(v) In Appeal No. E/1240/89-C (CCE v. Label), the appeal is dismissed. As per the direction in the impugned order, passed by the Collector (Appeals), the Assistant Collector shall decide the refund claim in light of classification directed in para (i) above.
(vi) In Appeal No. E/3257/88C (Meghdev), the appeal is allowed and the impugned order is modified as prayed for as per direction in para (i) above.
(vii) In Appeal No. E/3521/88C (CCE v. Meghdev), the appeal is dismissed.
(viii) In Appeal No. E/234/89C (Shree), the appeal is allowed, the impugned order is set aside and relief granted as prayed for as per direction in para (i) above.
(ix) In Appeal No. E/267/89C (Milton), the appeal is allowed and the impugned order is modified in terms of directions in para (i) above.
(x) In Appeal No. E/410/89C (CCE v. Milton), the appeal is dismissed.
(xi) In Appeal No. E/332/89C (Decent), the appeal is allowed and the impugned order is modified in terms, of directions in para (i) above.
(xii) In Appeal No. 471/89C (CCE v. Decent), the appeal is dismissed.
(xiii) In Appeal No. E/72/89C (Viral), the appeal is allowed and the impugned order is modified in terms of directions in para (i) above.
(xiv) In Appeal No. E/134/89C (CCE v. Viral), the appeal is dismissed.
(xv) In Appeal No. 437/89C (Viral), the appeal is allowed and the impugned order is set aside. The matter shall go back to the Assistant Collector for deciding the refund claim on merits and as per provision of law in light of our decision regarding classification in para (i) above and also in light of our decision in Appeal No. E/72/89C (Viral v. C.C.E., Ahmedabad).
(xvi) In Appeal No. 127/89C (Vishnagar), the appeal is allowed and the impugned order is modified in terms of our directions in para (i) above, (xvii) Appeal No. E/1920/89C (CCE v. Vishnagar). The appeal is dismissed.
(xviii) In Appeal No. 1270/89C (Sundek), the appeal is allowed and the impugned order is modified as per directions in para (i) above.
(xix) In Appeal No.E/1939/89-C (C. C. E. v. Sundek), the appeal is dismissed, (xx) In Appeal No. E/229/89-C (Jay), the appeal is allowed and the impugned order is modified as per directions in para (i) above, (xxi) In Appeal No. E/472/89-C (CCE v. Jay), the appeal is dismissed.
(xxii) In Appeal No. E/1070/89-C (Sunlame), the appeal is allowed and the impugned order is set aside. The matter shall go back to the Assistant Collector for deciding refund claim on merits as per provisions of law and in light of our directions regarding classification in para (i) above.
The appeals, which are allowed, are allowed with consequential relief to the appellants, permissible under Act & Rules, which should be granted within three months from the date of the receipt of the order by the concerned authority. The matters which will go back to the Assistant Collectors, shall be decided by him within three months from the date of receipt of this order by them after giving an opportunity of personal hearing to the appellant.