ORDER
Harish Chander, Member (J)
1. Collector of Central Excise, Jaipur has filed the above captioned 41 appeals being aggrieved from a common order passed by the Collector of Central Excise (Appeals), New Delhi. Since the issue involved is similar in the above captioned appeals, the same are disposed of by this common order.
2. The facts of all the appeals are similar. Only the facts in the case of M/s. Sanchoti Synthetics Pvt. Ltd. in Appeal No. E/1746/89-B are given below :-
3. The respondents had filed a classification list with effect from 1st August, 1983 indicating therein the description of the goods against Serial No. 1 as Iron & Steel product pieces of stainless steel roughly shaped by rolling and steel not elsewhere specified (commonly known as S.S. Patti) cold rolled / hot rolled)”. The rate of Central Excise duty leviable was shown at Rs. 330/- per MT and in column No. 9 of the classification list Notification No. 209/83-C.E. dated 1st August, 1983 was mentioned. The Assistant Collector issued a show cause notice to the respondent as to why the classification list should not be modified in exercise of the powers vested under sub-rule (2) of Rule 173B of the Central Excise Rules, 1944 to classify the said product under sub-item 12(1) of Tariff Item 25 of Central Excise Tariff. The Assistant Collector was of the view that the assessee did not give correct description of the product in the classification list. The product manufactured by the assessee did not come in the purview of the words “pieces of stainless steel roughly shaped by rolling of Iron & Steel not elsewhere specified falling under sub-item No. 8 of Tariff Item No. 25 of the first schedule to the Central Excises and Salt Act, 1944.” He was of the view that the product manufactured by the respondents was more appropriately classifiable as ‘Strips’ falling under sub-item 12(1) of the Tariff Item No. 25 as their product fulfils the requirement of the definition of strips as shown in the explanation appended to the Tariff Item No. 25 of the Central Excise Tariff, and as such the appropriate Central Excise duty rate leviable on the product strips under Notification No. 209/83-C.E. dated 1st August, 1983 should have been Rs. 650/-per MT in respect of cold rolled strips and Rs. 550/- per MT in respect of hot rolled. The Assistant Collector did not accept the contention of the assessee and held that the product manufactured was strips classifiable under Tariff Item 25 (12)(1) of the Central Excise Tariff. Accordingly, classification list effective from 1st August, 1983 filed by the respondent was approved under Tariff Item 25(12)(1) of the 1st schedule to the Central Excises & Salt Act, 1944. Being aggrieved from the aforesaid order the assessee has filed an appeal before the Collector of Central Excise (Appeals), New Delhi who vide his Order-in-Appeal No. 31 to 70-CE/JPR/87 dated 27th February, 1987 had ordered de novo adjudication to determine whether the goods were strips. The Assistant Collector in de novo adjudication confirmed the earlier view of the Assistant Collector and had held that the product manufactured by the respondent was strips falling under Tariff Item 25 (12)(1) of the first schedule to the Central Excises & Salt Act, 1944. Being aggrieved from the aforesaid order the respondent had filed an appeal before the Collector of Central Excise (Appeals). The Collector of Central Excise (Appeals) vide his order dated 25th May, 1989 held that the goods in question being of irregular shape and size and manufactured by the process of rolling were appropriately classifiable as pieces of roughly shaped by rolling of Iron and Steel not elsewhere specified. He had held that the goods in question not being in the form of coil or flattened coil could not be considered as strips in view of the specific definition given in the Central Excise Tariff and had further held that the goods in question being of irregular shape and size and manufactured by the process of rolling were appropriately classifiable as pieces of roughly shaped by rolling of iron and steel, not elsewhere specified and had held that the goods were classifiable under Tariff Item 25(8) of the Central Excise Tariff and had allowed the appeals. Being aggrieved from the aforesaid order the Revenue has come in appeal before the Tribunal.
4. Shri S.R. Narayanan, the learned Jt. CDR has appeared on behalf of the appellant. He has reiterated the facts and has pleaded that the period pertains to after 1st August, 1983 and the Tariff Item 25 was inserted with effect from 1st August, 1983. The respondents want assessment under Tariff Item 25(8) of the Central Excise Tariff as “pieces of roughly shaped by rolling of iron & steel, not elsewhere specified”. The Revenue wants assessment under Tariff Item 25(12)(1) as ‘strips’. Shri Narayanan, the learned Jt. CDR further states that the steel includes stainless steel. With effect from 17th November, 1986 the Notification No. 450/86-C.E. came into force and patta/patti are exempt after manufactured from duty paid ingots or fiats. Shri Narayanan has referred to page 29 of the paper book which deals with the process of manufacture. He has referred to the process of manufacture which has been discussed by the Assistant Collector in his order dated 4th September, 1984 which appears on page 29 of the paper book. He has pleaded that the product comes in rectangular shape. He has referred to the order in original. Shri Narayanan, the learned Jt. CDR in support of his argument has referred to the following judgments :-
1. 1988 (37) E.L.T. 67 (Tribunal) – Collector of Central Excise v. Narayani Udyog.
2. 1988 (37) E.L.T. 439 (Tribunal) – Collector of Central Excise, Ahmedabad v. Guru Rajinder Rolling Mills.
He has also referred to the earlier order of Collector (Appeals) passed by Shri R.K. Chakraborty. He has also referred to CCCN Vol. 3, Chapter – 3, Heading 73.12 and also referred to the following cases :-
1. 1989 (39) E.L.T. 175 (S.C.) Collector of Central Excise v. Calcutta Steel Industries and Ors.
2. 1989 (20) E.C.R. 303 (S.C.) Collector of Central Excise v. Calcutta Steel Industries and Ors.
Shri Narayanan, the learned JT. CDR has pleaded that’in case his plea as to the classification of the product as ‘strip’ is not accepted alternatively he pleads that it should be assessed under Tariff Item 25(13). Shri Narayanan has pleaded that patta/patti is a vernacular name. He has referred to 1984 E.C.R. 1672 (Cegat). Apar Pvt. Ltd. v. Collector of Central Excise, Baroda. He has also referred to the Order No. 490/84-B dated 1st June, 1984 [printed in 1984 (18) ELT 83], C.D. Industries v. Collector of Central Excise. Shri Narayanan has pleaded that the earlier judgments are prior to 1st August, 1983 and the period in dispute is under the new tariff and there is no direct decision after 1st August, 1983. He has pleaded for the acceptance of the appeals. Alternatively he has pleaded that the matter may be remanded.
5. Shri D.N. Mehta, the learned Advocate who has appeared on behalf of the respondents has pleaded that the definition built into tariff is binding. Shri Mehta, the learned Advocate has referred to the following judgments :-
1. 1988 (37) E.L.T. 67 (Tribunal )Collector of Central Excise v. Narayani Udyog Para-6
2. 1989 (39) E.L.T. 175 (S.C.) – Collector of Central Excise v. Calcutta Steel Industries and Ors. Para-8
Shri Mehta, the learned Advocate has pleaded that the goods cannot be treated as sheets. Sheets have to be rectangular and the respondents have not stated anywhere that the goods are sheets. Shri Mehta, the learned Advocate has also referred to Central Excise Tariff by Sh. R.K. Jain, 1983-84, Page 601, where the Tariff Advice No. 31/78 dated 15th June, 1978 is printed. He has referred to the following judgments :-
1. 1989 (43) E.L.T. 24 (Gujarat) – Genest Engineers Pvt. Ltd. v. Union of India
2. 1989 (14) E.T.R. 481 – Collector of Central Excise, Kanpur v. Yatindra Nath Shukla & Co., Kanpur.
He has further argued that the proceedings are ab initio void and bad in law. In support of his argument he has referred to the following judgments :-
1. 1989 (43) E.L.T. 471 (Tribunal) Collector of Central Excise v. Euphartna Laboratories.
2. 1980 E.L.T. 89 (Calcutta) Scientific Instruments Co. Ltd. v. Collector of Customs and Anr..
3. 1978 E.L.T. (J 556) Hyderabad Allwyn Metal Works Ltd. v. Collector of Central Excise, Hyderabad.
Doctrine of merger not applicable.
6. Shri Mehta, the learned Advocate has opposed the remand. In reply Shri Narayanan, the learned .Jt. CDR stated that (here is no direct decision of the Tribunal for the period 1st August, 1983 to 28th February, 1986 and there is also no direct decision on the definition of ‘strip’ after 1st August, 1983. Shri Narayanan, the learned Jt. CDR has pleaded for the acceptance of the appeal.
7. We have heard both the sides and have gone through the facts and circumstances of the case. We have considered the arguments of both the sides. The issue for determination in this appeal is whether the steel products manufactured by the respondents by rolling process are to be classified under Tariff Item 25(8) as pieces roughly shaped etc. or under Tariff Item 25(12)(1) as ‘strip’. The goods in the trade are known as patta/patti and not as ‘strip’. In view of the various judicial pronouncements for the period prior to 1st August, 1983 these goods were classified as ‘strip’ but under Item 26AA(ia). The respondents main argument is that the goods are roughly shaped pieces made by rolling process. The classification of the goods has to be decided within the tariff structure as it existed at the relevant time having regard to the equal specification of the goods. The definition is as under :-
“Hot or Cold-rolled products, rolled approximately in rectangular crosssection of thickness usually 10 millimeters and below, with mill, rolled, trimmed or sheared edges and supplied in coil or flattened coil (straight length) form but excludes hoop and skelp.”
The stainless steel pattis in question are of irregular shape and size as well as uneven thickness and the products are neither in coil Form nor in flattened coil. The description of Tariff Item 25(8) and 25(12) and 25(13) for the relevant period are reproduced below:-
__________________________________________________________________________________________
Tariff Item Description of goods Rate of duty
No.
__________________________________________________________________________________________
Item No. 25 Iron & Steel, & Products thereof;
__________________________________________________________________________________________
(8) Pieces roughly shaped by rolling or forging of Three hundred
iron or steel, not elsewhere specified. & fifty rupees
per M.T.
(12) Hoops, strips and skelp of iron or steel One thousand 3
whether galvanised or not hundred & 50/-
rupees per M.T.
(i) hoops and strips
(ii) skelp
(13) Coils for rerolling, sheets, plates, and universal
plates of iron or steel, hot or cold rolled, whether
galvanised or not; forms such as ridges, Channels
(other than slotted channels), rain-water pipes and
their fittings made from sheets, plates, or universal
plates : and tin plate and tinned, lacquered or
varnished sheets including tin taggers and cuttings of
such plates, sheets or taggers
(i) galvanised sheets, plates and forms - One thousand
300/- & 50/-
per MT
(ii) Tin plate and tinned sheets including tin - 1,750/- per
taggers and cuttings of such plates, sheets or taggers MT.
(iii) lacquered sheets, varnished sheets including - 1,250/- per
cuttings of lacquered sheets and varnished MT.
sheets
(iv) Others -1,350/- per MT
8. A simple reading of sub-item 8 of Tariff Item 25 will show that where the pieces are roughly shaped by rolling of iron and steel, not elsewhere specified. Definition of strip (XIV) and tariff Item 25 is as follows :-
“Strip” means hot or cold-rolled products, rolled approximately in rectangular cross-section of thickness usually 10 millimetres and below with mill, rolled, trimmed or sheared edges and supplied in coil or flattened coil (straight length) form but excludes hoop and skelp”.
By the above definition among other dimensions the strip should be supplied in coil or flattened coil (straight length) form, but in the case of appellant strip is not flattened coil nor is it supplied in coil form. Therefore the contention of the revenue that the “patta/patti” is a strip under Item 25(12) will not be correct and even if it is argued that strip need not be in coil or in flattened coil (straight length), yet the tariff description and definition has to be strictly applied. Therefore the classification under Item 25(12) is found to be appropriate. In the case of Saurashtra Chemicals, Porbandar v. Collector of Customs, Bombay reported in 1986 (23) E.L.T. 283 the Tribunal had taken the view that Section Notes and Chapter Notes in the Customs Tariff Act are a part of the statutory tariff and thus relevant in the matter of classification of goods under the Customs Tariff. The relevant headings in the tariff have to be interpreted and applied in the light of Section Notes and Chapter Notes which are statutory and binding like the headings themselves. These. Section Notes and Chapter Notes sometimes expand and sometimes restrict the scope of certain headings. In other words the scheme of the Customs Tariff Act is to determine the coverage of the respective headings in the light of the Section Notes and Chapter Notes. In this sense, the Section Notes and Chapter Notes have an overriding force on the respective headings. The goods in question do not specify the definition of ‘strip’. The judgments cited by the learned CDR do not help him. We uphold the findings of the Collector (Appeals). We do not find any merit in Revenue’s appeals. The same are dismissed.