ORDER
V.P. Gulati, Member (T)
1. This is an appeal filed by the Collector of Customs, Bombay against the order of Collector of Customs (Appeals), Bombay
2. Brief facts of the case are that the respondents imported printed PVC sheets and claimed benefit of Notification No. 342/76 and claimed refund of duty paid in excess of the exempted rate of duty in terms of the said Notification. The Assistant Collator rejected the refund claim on the following two grounds:
“(1) The proper certificate of country of origin was not produced;
(2) PVC sheets are manufactured articles from the raw material obtained after polymerisation and co-polymerisation.”
3. The Collector (Appeals) on appeal filed by the respondents accepted the respondent’s plea and held that the necessary certificate for the purpose of claiming benefit of concession the goods being of Korean origin, was correctly filed. He also held that in terms of Serial No. 6(1)(c) of the Table to the said notification PVC sheets imported were covered by the description of the goods which were eligible for the benefit of the notification. The Appellant Collr. has urged the following grounds in his appeal:
“The learned Collector (Appeals) has erred in holding the view that PVC sheets are covered by Entry No. 6(1)(c) of the Table annexed to Notification 342/76-Cus. The relevant entry reads as follows:
6. Polymerisation and co-polymerisation products (for example, polyethlene, polytetrahaloethlenes, polyisobutylene, polystyrene, polyvinyl chloride, polyvinyl acetate, polyvinyl chloroacetate and other polyvinyl derivatives, polyacrylic and polymethene-acrylic derivatives, curranie-Indene resins)
(i) Polyvinyl Chloride
(a) Liquid
(b) Powder and Granules
(c) Other forms
(ii) Polyvinyl acetate
(iii) Polystyrene
(a) Liquid
(b) Powder and Granules
(c) Other forms
The entry pertinent to this case is Entry No. 6(1)(c) i.e. polyvinyl chloride in other forms and the point to be considered is whether this entry covers polyvinyl chloride resins, plasticizers, stabilizers, dyestuff. The process of manufacture of printed PVC sheets is by adding plasticisers and stabilizers to PVC resin which thereafter is calendered into sheets on which design is printed. It is clear that the entry in the notification viz. 6(1)(c) covers only polyvinyl chloride in all forms and not articles like printed PVC sheets manufactured out of polyvinyl chloride by adding plasticizers and stabilizers and dyestuff to such polyvinyl chloride. The entry especially covers polyvinyl chloride in primary forms only. In the Condensed Chemical Dictionary (10th Edition) Revised by Gessner G. Howley, polyvinyl chloride is described as “A synthetic thermoplastic polymer”. It is also mentioned there that polyvinyl chloride is readily compounded into flexible and rigid forms by use of plasticizers, stabilizers, fillers and other modifiers and easily coloured and processed by blow moulding, extrusion calendering etc. and made available as film, sheet, fabric and foam. It is clear from this that polyvinyl chloride does not include articles such as sheets, films, made by compounding polyvinyl chloride with plasticizers, stabilizers and other modifiers.
Sheets with designs on one side are finished goods and are not raw material like granules powder etc. Articles manufactured out of PVC or compounded PVC, therefore fall outside the scope of Entry 6(1)(c) of Notification No. 342/76-
Cus. and hence preferential assessment is not available to printed PVC sheets involved in this case. Production of c/o does not alter this position.”
4. The learned JDR for the Department, Shri L.C. Chakarborty, stated that the Notifn. No. 342/76 covered only primary products and did not cover the imported sheets imported by the respondents. He reiterated the grounds in the Memorandum of Appeal.
5. Shri N.R. Kantawala, Advocate for the respondents stated goods had been assessed under 39.01/06 and PVC is one of the items covered under the description of this Tariff Heading. He drew our attention to Note 3 of Chapter 39. The same is reproduced below for convenience of reference:
“Heading No. 39.01/06 is to be taken to apply to materials in the following forms only:
(a) Liquid or pasty (including emulsions, dispersions and solutions);
(b) blocks, lumps, powders (including moulding powders), granules, flasks and similar bulk forms;
(c) monofil of which any cross-sectional dimension exceeds one millimetre; seamless tubes, rods, sticks and profile shapes, whether or not surface-worked but not otherwise worked;
(d) plates, sheets, films, foil and strip (other than that classified in Heading No. 51.01/03 by the application of Note 4 to Chapter 51), whether or not printed or otherwise surface-worked, uncut or cut into rectangles but not further worked (even, if, when so cut, they become articles ready for use); and
(e) waste and scrap.”
He pointed out that in terms of 3(d) above, the type of sheets imported by the respondents were also covered under 39.01/06. He stated that under Item 6(1)(c) of the Notification No. 342/76 apart from liquid power and granule states of PVC, its other forms were also covered under the notification. He stated that sheets imported were covered by the description ‘Other forms’. He cited the case of Aggarwal Tyres v. Commissioner of Sales Tax : 1979 (43) STC 425 (MP) in support of his plea that the word ‘Other form’ covered even rolls. He stated that inasmuch as the goods had been assessed under T.I. 39.01/06 CTA under which polyvinyl chloride was covered and under the notification also PVC falling under T.I. 39.01/06 was covered, the notification should be interpreted taking into account the scope of the Tariff Entry. He pleaded that inasmuch as the Heading 39.01/06 covered PVC sheets of the type imported, these should be taken to have been covered under Item 6(1)(c) of the notification. For proper appreciation of the facts and convenience of reference relevant portions of the notification are reproduced below:
“The goods specified in column (2) of the Table annexed hereto and falling under the corresponding entry in column (3) of the said Table, when imported into India from Brazil or Spain or Turkey or Yugoslavia or the Republic of Korea or Tunisia or the Arab Republic of Egypt or Chile or Mexico or Uruguay or Peru or Paraguay or Bangladesh or Romania, are exempt from so much of that portion of the standard rate of duty of Customs specified in the said First Schedule with respect to the aforesaid goods read with any other notification (for the time being in force) issued with respect of such goods under Sub-section (1) of Section 25, of the Customs Act, 1962 but not including the notifications of the Government of India in the Department of Revenue and Banking or in the Department of Revenue and Banking (Revenue Wing) or in the Ministry of Finance, Department of Revenue, as the case may be Nos. 341-Customs, dated the 2nd August, 1976, 431-Cus., dated 1st November, 1976,63-Customs, dated 1st April, 1978, No. 21-Cus., dated the 27th January, 1979 and Notfn. No. 191-Cus., dated 14-8-1981 as is specified in col. (4) of the said Table:
Provided that the importer proves (in accordance with the Rules of Origin referred to in Paragraph 10 of the protocol relating to Trade Negotiations among Developing Countries, signed on the 8th day of December, 1971) to the satisfaction of the proper officer of the Customs that the goods in respect of which the benefit of this exemption is claimed ace of the origin of Brazil or Spain or Turkey or Yugoslavia or the Republic of Korea or Tunisia or the Arab Republic of Egypt or Chile or Mexico or Uruguay, or Peru or Paraguay or Bangladesh or Romania as the case may be.
THE TABLE
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Sl. Description of goods Heading No. in the Extent of tariff con-
No. First Schedule to cession
the Customs Tariff
Act, 1975
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(1) (2) (3) (4)
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6. Polymerisation and co-
polymerisation products
(for example, polyethylene,
polytetrahaleothylenes,
polyisobutylene, polystyrene,
polyvinyl chloride, polyvinyl
acetate, polyvinyl chloroacetate
and other polyvinyl derivatives,
polyacrylic and polymethacrylic
derivatives, cumarone-indene
resins):
(i) Polyvinyl chloride: 39.01/06 50 per cent of the
(a) Liquid standard rate of duty
(b) Powder and grains
(c) Other forms"
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6. We observe that the exemption has been given in respect of the specified items falling under ‘specified tariff heading’ in the First Schedule to the Customs Tariff. It is therefore relevant that for the purpose of determining the scope of the items covered under the said notification the scope of corresponding tariff entry under which the goods fall be examined. In the present case, description under which the goods are sought to be covered are ‘Polyvinyl Chloride’. The Revenue have assessed the same under T.I. 39.01/06. The goods have therefore been held to be answering to the description Polyvinyl Chloride as set out under Tariff Item 39.01/06. It is seen that so far as the scope of polyvinyl chloride falling under 39.01/06 is concerned, the same in terms of the Chapter Notes covers apart from the material being in liquid, pasty, and granule form also the material in sheet form. These sheets imported were tested by the Departmental authorities and found to be sheets and described as PVC (flexible). The material has not been found to be anything other than PVC. In view of the fact that the goods answer to the description of PVC and the fact that the sheets are covered under T.I. 39.01/06, the same have to be held to be falling under the category of PVC “Other forms” under 6(1)(c) of the Notfn. We find no force in the plea of the Revenue that the PVC covered under this item has only to be in raw material form as pleaded in the Grounds of Appeal. We, therefore, find no infirmity in the lower authority’s order and reject the appeal.