ORDER
V.K. Agrawal, Member (T)
1. This is an application by M/s. Sheela Foam Pvt. Ltd. for waiver of pre-deposit of Central Excise duty amounting to Rs. 73,78,750/-.
2. Shri Praveen Sharma, learned Advocate, submitted that the Applicants manufacture PU Foam sheets, Composite sheets, Taped PU Foam sheets and Cushions which have been classified by them under sub-heading 3921.1 (sic) of the Schedule to the Central Excise Tariff Act; that the Commissioner (Appeals) have confirmed the demand of duty by classifying the products under Heading 94.04 of the Tariff holding that the products are mattresses. The learned Advocate, further, submitted that PU Foam blocks are obtained by chemical reaction from the inputs Polyol and Isocynates; that PU Foam Blocks are in irregular and they are cut into blocks of regular geometrical shape by removing side skins, top skins and bottom skins; that these blocks are further cut into specific dimensions to result in PU Foam sheets which are cleared as such from the factory; that the Central Board of Excise & Customs has circulated, vide letter dated 17-12-2001, a copy of letter dated 25-7-91 received from Nomenclature & Classification Directorate of Customs Cooperation Council Brussels, regarding classification of flexible Polyurethane foam slabs or sheets for use as Mattresses; that according to said advice, expanded Polyurethane sheets, merely cut into rectangles would be classified under Heading 39.01 despite the fact that they were intended for use as mattresses and the Committee also decided that mattresses of expanded foam or sponge rubber, made by moulding fell to be classified in Heading 94.04; that Meerut Collectorate has also issued a Trade Notice No. 4/1993 dated 18-1-93 to this effect. The learned Advocate also relied upon Note 10 to Chapter 39 of the Tariff, according to which in Heading No. 39.21 plates, sheets, etc. applies only to plates, sheets, etc. and to blocks of regular geometric shape, whether or not printed or otherwise surface-worked uncut or cut into rectangles (including squares) but not further worked (even if when so cut they become articles ready for use) and emphasized that the impugned goods have not been further worked by them and as such are classified under sub-heading 3921.1 (sic) of the Tariff.
3. Opposing the prayer Shri Jagadish Singh reiterated the findings as contained in the impugned Order.
4. After considering the submissions of both the sides we are of the view that the Appellants have made out a strong prima facie case in their favour in view of Note 10 to Chapter 39 and the classification advice from Nomenclature and Classification Directorate of Customs Cooperation Council. We, therefore, stay the recovery of entire amount of duty during the pendency of appeal which will come up for regular hearing on 19-8-2003.