PETITIONER: COLLECTOR OF CENTRAL EXCISE, MADRAS Vs. RESPONDENT: M/S MRF LIMITED ETC. DATE OF JUDGMENT: 03/12/1997 BENCH: S.P. BHARUCHA, S.C. SEN ACT: HEADNOTE: JUDGMENT:
THE 3RD DAY OF DECEMBER, 1997
Present:
Hon’ble Mr.Justice S.P. Bharucha
Hon’ble Mr.Justice S.C. Sen
Joseph Vellapalli, Sr.Adv., Anoop G. Choudhary, Rajiv Nanda,
V.K. Verma, S.D.Sharma, S.Ganesh K.R. Nambiar, V.Sridharan,
T.Viswanathan, V.Balachandran, and Rajesh Kumar, Advs. with
him for the appearing parties.
J U D G M E N T
The following Judgment of the Court was delivered:
WITH
CIVIL APPEAL NOS. 2112 OF 1988 AND 8341-42 OF 1995
Bharucha, J.
We are concerned in these appeals with product “rubber
cement” or “black vulcanising cement” manufactured by the
assessees. The case before the Tribunal was that the said
product fell under Tariff Entry 40.17 according to the
assessees and under Tariff Entry 40.05 according to the
Revenue, the appellant before us. The Tribunal came to the
conclusion that the said product was correctly classifiable
under Tariff Item 35.012 prior to 10th February, 1987, and
under Tariff Item 35.06 thereafter. The assessees have
accepted the classification made by the Tribunal Only the
Revenue is in appeal
Tariff Entry 40.05 reads thus:
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Heading Sub-Heading Description of goods Rate of duty
No. No.
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40.05 4005.00 Compounded rubber, 40%
unvulcanised, in
primary forms or in
plates, sheets or
strip.
————————————————————
–
Tariff Entries 35.01 and 35.06 read thus:
————————————————————
Heading Sub-Heading Description of goods Rate of duty No. No.
————————————————————
“35.01 Albuminoidal substances;
modified straches; glues;
enzymes 3501.10 -Esterified starches 40% 3501.20 -Dextrins and other 15% modified starches 3501.90 -Other 15% 35.06 3506.00 Prepared glues and other 15% prepared adhesives, not elsewhere specified or included."
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The Tribunal noted the process by which the said
product was manufactured. If found that the raw material
that was used to manufacture the said product was classified
by the Revenue under Tariff Entry 40.08, which reads thus:“Plates, blocks, sheets, strip,
rods, and profile shapes, of
vulcanised rubber other than
hardened rubber.”
The Tribunal said that this would point to the position
that the raw material was vulcanised rubber and that,
therefore, the said product could not possibly fall within
Tariff Entry 40.05 which spoke of “Compounded rubber, un-
vulcanised, in primary forms…..”.
Learned counsel for the Revenue drew our attention to
Chapter Note 3 of Chapter 40 of the Central Excise Tariff
which reads thus:
“3 In heading Nos. 40.02, 40.03 and
40,05, the expression ‘primary
forms’ applied only to liquids and
pastes (including latex, whether or
not prevulcanised, and other
dispersions and solutions), and
blocks of irregular shape, lumps,
bales, powders, granules, crumbs
and similar bulk forms”.
It seems to us that no argument based on Chapter Note 3
or otherwise can be of any avail to the Revenue, having
regard to the undisputed position that what is used as a raw
material to produce the said product is classified by the
Revenue itself as vulcanised rubber. If the raw material is
vulcanised rubber, the said product made from it cannot
possibly be unvulcanised rubber the said product made from
it cannot possibly be unvulcanised compounded rubber.
The Revenue is, therefore, unable to satisfy us that
the said product falls under Tariff 40.05 as it claims. it
cannot argue that, in any event, the Tribunal was in error
in classifying the said product under Chapter 35.
The appeals are dismissed with no order as to costs.