ORDER
Gowri Shankar, Member (T)
1. The assessee manufactures goods known as reeds or reed wire. The product is manufactured by subjecting circular wire of continuous length to a process of drawing on its own steam through roller, as a result of which the product becomes rectangular and thereafter subjecting the goods to processes such as polishing. The department was of the view that the product would be a strip classifiable under Item 25(12) of the Central Excise and issued a notice demanding duty accordingly. The assessee resisted the notice. However the Assistant Collector did not agree to the contentions raised by it and held that the manufacture was a strip and assessed to duty accordingly. In appeal, Collector (Appeals) held in favour of the assessees. He was of the view that, despite the processes which it undertakes, it did not lose its character as wire. He found that the resultant product also confirms to the definition of wire given in the tariff. He therefore allowed the appeal. Hence the appeal by the department.
2. In coming to his conclusion Collector (Appeals) was greatly influenced by the view of the Government of India communicated in its letter No. 139/68/85-CEX XIV, dated 9-12-1985. This circular expressed the opinion of the Board that the wire, the shape of which is changed from round to flat by passing it through rerollers continued to be classifiable as wires and the process of conversion did not result in a change to an extent which would make it fall within this statutory definition “strip.” Hence this appeal.
3. The ground in the appeal is that Collector was in error in relying upon Board’s circular, and that circular referred to flattened wire which is different from the product under consideration namely reed wire. The departmental representative emphasized that in the case of the products construed by the Board in its circular, the only process which was undertaken was flattening the round wire whereas in the present case the wire undergoes processes such as cutting, polishing etc. He contends that the product, after it is subjected to these processes, conforms to the definitions of strips contained in Tariff 35.
4. Advocate for the respondent seeks to answer this point by stating that the processes such as polishing are not such as would render the product a different one; that the finding of the Collector (Appeals) that the product is known and treated in the market as strip and not wire has not been questioned in the appeal. He raises a new contention that the department has not established that the product is marketable.
5. In the case of flattened wire the change in shape takes place in cold form by passing the wire through rerollers which changes the shape of the wire from round to flat. Such flattened wires are not known to have milled, rolled, trimmed or sheared edges. Moreover in the definition “strips” appearing in Item 25 it is specified that such strips are supplied in coils or flattened coil, straight length form. While it could be argued that the process of flattening of a wire is not a cold drawning process (the cold drawn process takes place at the earlier stage of manufacture of round wire) the fact remains that the process of conversion of a round wire into flattened wire does not result in a change to an extent which would make it fall within the statutory definition of “strips”.
6. It is not correct to say as the departmental representative contends, that the Board’s circular only referred to those goods in which the products were formed by changing the shape of round wires into rectangular. No doubt the definition of “strips” in the Tariff contemplates that the product must have been rolled. However the contention made that the goods are not supplied in coils or flattened coil form for the reason that they are captively consumed and not supplied has not been answered. Further there is no dispute that the product at the starting point of the product is a wire. It is not dispute that it was a cold drawn product forming to the dimensions and specification in the explanation to the list. The logic behind the circular of the Board that merely by changing its shape from circular to rectangular the product does not cease to be a wire. The finding of the Collector (Appeals) that the subject goods are known in the trade as wire and not a strip is not challenged in the appeal. We are therefore of the view that there is insufficient material in the department’s appeal to warrant interference with the Collector (Appeals) order. We therefore dismiss the appeal.