ORDER
H.R. Syiem, Member (T)
1. These seven appeals are filed by the assessees and the department and concern the assessment of steel products which the department held should be assessed as strips under Item 25(12) CET and the assessees say should be assessed under Item 25(8)CET as pieces roughly shaped by rolling or forging of Iron or steel.
2. During the arguments, the learned counsel for the department disputed the claim that since the goods were not manufactured in strip mills, they should not be assessed as strips. He maintained that since the products have the contours and the cross-sections of strips as defined In the tariff, they should be assessed as strips, because that is the closest description that these goods relate to. On the opposite side, the learned counsel for the assessees maintained that the goods were not produced in strip mills and in accordance with the decision in the past of the Tribunal, they would not be assessable as strips. They do not have the contours of strips, because they do not have rectangular cross-sections. The learned counsel submitted that these goods are known as pattis and pattas and that this is recognised by the government itself in a Notification No. 450/86-C.E., dated 17-11 -1986 which grants exemption to goods only as pattis or pattas of stainless steel and falling under Chapter 72 of the Central Excise Tariff, 1985. The goods, said the counsel, are not used as strips are known to be used, but are used for the manufacture of utensils, and this fact has been known to the department for a long time. They are short length straight products; they have an uneven thickness and uneven sides. Unlike strips, they are not always straight in form but are often curved and uneven. Sometimes the widths at the two ends are different giving them a somewhat tapering shape. He also produced some photographs before the bench.
3. It is not necessary to go into all the arguments and submissions of the two learned counsels for reasons that will be apparent in the following paragraphs.
4. All the adjudicating authorities whether Assistant Collector or Additional Collector or Collector (Appeals) who decided that the products are strips depended for their decision on the definition given in the Central Excise Tariff. The Tariff explains strips as meaning hot or cold rolled products, rolled approximately In rectangular cross-section of thickness usually 10 mm and below with mill, rolled, trimmed or sheared edges and supplied in coll or flattened coll (straight length) form but excludes hopes and skelps.
5. The fact that the products of the assessees are short straight lengths are dealt with by the argument that the strips can be in coil as well as in straight length, either rolled in that form or straightened/flattened form. The patta or patti from the fact that It is in straight length would faff under the category of strip If Its dimensional measurement conformed to strips as indicated In the definition.
6. In my opinion, this is the Important factor in this dispute and I think that this is where all the adjudicating authorities who assessed the products as strips under 25(12) fell into their error. They understood the words flattened coil (straight length) form as a signal that even if the product Is produced In straight length, if It otherwise conforms to the other measurements, it would still be a strip. This is a mistaken assessment and is not supported by anything either in the law or in iron and steel industry. It must be noted very clearly that the definition has the words straight length in brackets following the words flattened coll. In the explanation they appear thus:
Coil or flattened coil (straight length) form.
The words straight length should be read as a complement or a qualification or an illustration of the words flattened coil form. That is to say, trie straight length should be of a flattened coil form. The error of the adjudicating authorities was to read the words straight length as an independent description of what a strip can be. It is not; It Is only an accompanying enlargement of the description flattened coil form. Once we keep this before ourselves, we can see clearly the meaning of the law. Whatever dimensions and measurements the strip may have, it must be, in fact, in coll form or in flattened coil form and even If It is In straight length; it must be a straight length of a flattened coil.
7. I can find no dispute from the department, and in fact, It seems to be accepted, that the products were of straight length and that they had never been subjected to coiling. Coiling was not necessary because their length was too short to allow coiling. Nor is It a dispute that the lengths were not brought about by cutting longer lengths. The products pattis were produced in the form in which they were assessed – straight length pieces about 7 feet long. Technologically and in terms of the law, a strip must be in coil form even If ft to in straight lengths. That means that the products must have been manufactured in cod form, and later flattened, cut, or otherwise uncoiled. We know that this is not the case; the goods came out only in straight lengths. In fact, It is the absence of coiling that led the adjudicating authorities to decide that they were assessable as strips and to say that even a straight length product can still be a coil because of the words straight length in the definition of strips. As I have discussed above, this is a mistaken interpretation not supported by either the law or by technological works. Indeed, an odd argument was advanced in order-in-appeal No. 599 to 601-CE/CHG/85 that coiling is necessary only If the product is of a very big length and since the SS pattis are of small size of about 6′ to 7. it was not necessary to coll them. If it was not necessary to coil them, then obviously they could not have been strip.
8. There were submissions during the adjudications that there were other mills which produced the same kind of products, but which were not assessed as strips. The adjudicating authorities ignored these submissions and had nothing to say about them.
9. On the authority of the Government of India’s notification giving exemptions to them, pattis are dearly recognised products and well-known. And the authorities who assessed them all accepted the products to be pattis.
10. However, we have the same problem here as we discussed in our order No. 118 to 131/88-B1, dated 11-3-1988. The widths of the products have not been recorded anywhere to enable us to judge the proportional surface measurements. It Is useful, and In these cases, necessary, to have all these measurements and dimensions as the shape of a product can determine Its nomenclature. For example, a flat rolled product with the thickness and cross-section of a strip may be more like a sheet than like a strip if its width. and length are equal or nearly equal.
11. We must, therefore, remand these cases to the Assistant Collector, the original authority, to provide all the requisite details, before assessing the products. Needless to say, he will record all necessary details while adjudicating.
12. For this purpose, we set aside all the orders of the lower authorities.