ORDER
V.K. Agrawal, Member (T)
1. The issue involved in this appeal filed by M/s. Cooline Manufacturers Pvt. Ltd. is whether Pipe Sections and Thermo Ceil manufactured by them are classifiable under Sub-heading 39.16 and 39.18 of the Schedule to the Central Excise Tariff Act respectively as confirmed by the Department, or under Sub-heading 3926.90 and 3925.99 as claimed by them.
2. Shri R.S. Dinkar, learned Advocate, submitted that the Appellants manufacture articles of plastic popularly known as Thermocol out of expandable polystyrene beads which are expanded in a pre-foaming machine and then moulded into shapes; that these take the shape of Pipe Sections and Tiles; that tiles are marketed in the name of Thermoceil which are used in ceilings for insulation purposes. He further mentioned that the Asst. Commissioner under Order-in-Original No. 81/89 dated June 1989 has held that Pipe Sections have been manufactured by moulding process and the duty demand was dropped; that there has been no change in the Heading and as such this Order of the Asst. Commissioner should continue to hold the ground. He further submitted that Heading 39.16 of the Central Excise Tariff applies, inter alia, to profile shapes; that Pipe Sections manufactured by them are not covered by the expression ‘Profile Shape’; that according to the Concise Oxford Dictionary Profile means “drawing, silhouette, or other representation, of side view”; that Pipe Section manufactured by them is not profile shape of anything as when two such Sections are put together they make a pipe itself; that in commercial parlance also the pipe sections are known as articles of plastic, and therefore, are classifiable under Heading 3926.90. He relied upon the decision in the case of CCE, Ludhiana v. Madras Rubber 2004 (174) ELT 81 (Tri) wherein it has been held by the Tribunal that “outline of an object is normally called a profile. A picture of representative of the side view of the article may also be said to be a profile.” He contended that the impugned product ‘pipe section’ is not a picture of representative of side view of an article and as such it is not profile section.
3.1 Regarding Thermo Ceil which is used for false ceiling the learned Advocate submitted that Heading 39.18 reads as under:
“Floor coverings of plastic, whether or not self-adhesive, in rolls or in the form of tiles; wall or ceiling coverings of plastics, as defined in Note 9 to this Chapter.”
3.2 He mentioned that as per Note 9 to Chapter 39 of the Central Excise Tariff, for the purpose of Heading 39.18, the expression ‘wall or ceiling’ coverings of plastic, applies to products in rolls, of width not less than 45 cms suitable for wall or ceiling decoration, consisting of plastic fixed permanently on a backing on any material other than paper, the plastic layer (on the face side) being grained, embossed, coloured, design – printed or otherwise decorated; that according to Note 9 for classification as wall or ceiling covering, the product must essentially satisfy two conditions, (i) it must be in rolls; (ii) it must be fixed permanently on a backing on any material; that both these conditions are not satisfied in the case of Thermo Ceil inasmuch as it is not in rolls nor is it fixed permanently on a backing of any material; that Thermo Ceil is a product manufactured in the form of tiles by process of moulding of extended polystyrene beads.
4. Finally he submitted that if the benefit of Exemption Notification is denied to them by classifying the product as claimed by the Revenue the Appellants would be eligible for the Modvat Credit of the duty paid on inputs; that further the price has to be treated as cum-duty price in terms of the decision of the Supreme Court in the case of CCE v. Maruti Udyog Ltd., 2002 (180) ECC 249 (SC) : 2002 (141) ELT 3 (SC).
5. Countering the arguments Shri Randhir Singh, learned DR, submitted that Pipe Sections are specifically covered by Heading 39.16 as they are in profile shape; that Note 9 only describes the specification of rolls for being falling under Heading 39.18 as wall or ceiling coverings of plastic; that Note 9 does not excludes tiles from the purview of Heading 39.18.
6. We have considered the submissions of both the sides. Heading 39.16 of the Central Excise Tariff applies to monofilament of which cross sectional dimension exceeds 1 mm, rods, sticks and profile shape whether or not surface worked not otherwise worked of plastic. As per H.S.N. Explanatory Notes the products falling under Heading 39.16 are obtained in the length in a single operation (generally extrusion), and they have a constant or repeated cross section from one end to the other. The impugned product as shown by the lea mod Advocate is nothing but a profile shape appropriately classifiable under Heading 39.16 of the Tariff. The mere fact that the Asst. Commissioner once has decided the classification in their favour does not mean that the said classification will continue for all the time to come. The decision in the case of Madras Rubber relied upon by the learned Advocate, is not applicable to the facts of the present matter as the product involved in that matter was in the form of Square sheet and the Tribunal, therefore, held that square sheet cannot be held to be a profile. Thus, the appeal filed by the Appellants regarding classification of Pipe Section is rejected. However, we find force in the submissions of the learned Advocate that the price charged by them is to be treated as cum-duty price from which the assessable value has to be determined by allowing the statutory deduction in terms of the judgment of the Supreme Court in Maruti Udyog Ltd. Further, the Appellants would be eligible for the Modvat Credit of duty paid on inputs used in or in relation to the manufacture of pipe sections subject to the condition that the Appellants will produce duty paying documents within two months of receipt of this Order to the proper officer for verification. The Jurisdictional Officer will determine the duty liability of the Appellants accordingly,
7. As far as classification of Thermo Ceil is concerned, we observe that only those wall or ceiling covering of plastic are covered under Heading 39.18 which are defined in Note 9 to Chapter 39. A perusal of Note 9 to Chapter 39 clearly reveals that wall or ceil covering of plastic falling under Heading 39.18 has to be in rolls of a width not less than 45 cm suitable for wall or ceiling decoration consisting of plastic fixed permanently on a backing of any material other than paper. It has not been disputed by the Revenue that the Thermo Ceil manufactured by them is in tile form and not in rolls. Once the product is not in rolls it cannot be classified under Heading 39.18. There is no substance in the submissions of the learned DR that Note 9 does not exclude tiles which are used as wall or ceiling coverings as Note 9 is very specific for the purpose of Heading 39.18, the expression wall or ceiling covers of plastic applies to products in rolls. It nowhere mentions that it applies also to tiles. Accordingly Thermo Ceil as manufactured by the Appellants is not classifiable under Heading 39.18. The appeal filed by them on this count is allowed.