ORDER
R.V. Raveendran, J.
1. These petitions coming up for orders today, by consent of parties, finally disposed of.
In all these petitions, the petitioners are manufacturers of HDPE/PP tapes or strips, HDPE/PP Fabrics – laminated and unlaminated, HDPE/PP Woven Sacks (hereinafter together referred to as the said goods). The ‘said goods’ are exigible to Central Excise Duty under the Central Excise Tariff Act, 1985. The levy, assessment and collection of said duty is regulated by the provisions of the Central Excises and Salt Act, 1944.
2. Earlier the said goods were covered under the Tariff Item 15A(1) and 15A(2) of the Schedule to the Central Excises and Salt Act (hereinafter referred to as ‘the Act’). 15A(1) related to plastic materials in primary form and 15A(2) related to articles of plastic. Subsequently Tariff Item 15A(2) was amended and thereafter HDPE Woven sacks which was not one of the specified items in Item 15A(2) was relegated to Tariff Item 68.
3. After the Central Excise Tariff Act, 1985 came into force with effect from 1-3-1986, HDPE/PP tapes or strips were classified under Sub-heading 5406.90 HDPE/PP Fabric (unlaminated) was classified under the sub-heading 5408.00 HDPE/PP Fabrics (laminated) was classified under the sub-heading 5903.21. HDPE/PP Woven Sacks was classified under the sub-heading 6301.00.
4. The petitioners sought re-classification and filed fresh classification lists before their respective Assessing Authorities classifying the goods as follows:
———————————————-
DESCRIPTION OF GOODS SUB-HEADING ---------------------------------------------- 1. HDPE/PP Tapes/Strips 3920.32 2. HDPE/PP Fabrics (Laminated and 3923.90 unlaminated) 3. HDPE/PP Woven Sacks 3923.90 ----------------------------------------------
The said classification was not approved. In the meanwhile a Circular dated 18-11-1988 was issued by the Central Board of Excise & Customs under Section 37B of the Act confirming the classification in regard to HDPE/PP Woven fabrics under Heading 54.08. In view of the said Circular which was binding on the Authorities under the Act, there was no point in filing appeals against the rejection of the Classification lists. Hence the petitioners filed these writ petitions for quashing the said Circular dated 18-11-1988 and for a direction to the respondents to permit the petitioners to clear the goods in accordance with the classification list filed by them and for refund of excess duty collected on the basis of the wrong classification.
5. This Court by interim orders, permitted clearance of the goods as per the Revised Classification list filed by petitioner, subject to certain conditions and subject to final decision in the petition.
6. The Central Board of Excise and Customs has issued a Circular dated 24-9-1992 under Section 37B of the Act to ensure uniformity in the Classification, and ordered that HDPE strips and tapes (of a width not exceeding 5 mm) shall henceforth be classified under sub-heading 3920.32 and sacks made therefrom under sub-heading 3923.90 of the Tariff. The said Circular refers to the decision of the Madhya Pradesh High Court in Raj Pack Well Ltd. Indore v. Union of India in Miscellaneous Petition No. 1205 of 1988, decided on 7-11-1989 [1990 (50) E.L.T. 201 (M.P.)] holding that HDPE tapes/strips are classifiable under sub-heading 3920.32 and HDPE Sacks under 3923.90 of the Tariff. The Circular further states that the said Classification will hold till the decision of the Supreme Court in the appeal filed by the Department against the judgment of the Madhya Pradesh High Court in Raj Pack Well’s case. Having regard to the said Circular issued under Section 37B of the Act, which is binding on all the authorities under the Act, the petitioners are entitled for approval of their respective classification lists filed. In the above circumstances, these petitions can also be disposed of in terms of the Circular dated 24-5-1992 and the decision of the Madhya Pradesh High Court referred to in the said Circular. It was however contended in W.P.1834/1991 that the Circular should be given effect only prospectively. The question is not whether the Circular should be given effect prospectively or retrospectively. This writ petition has been filed challenging the classification in the year 1991 much prior to the Circular dated 24-5-1992. The contention of the petitioner in the writ petition is being accepted on the principle laid down in Raj Pack Well’s case and which is accepted in the Circular dated 24-5-1992. Hence it cannot be contended that the classification under Chapter 39 should be with effect from 24-5-1992 only.
7. Hence these writ petitions are allowed on the following terms :
(a) The Assessing Authorities shall consider and grant approval to the classification list in regard to the said goods, filed by the petitioner seeking classification under Chapter 39, in terms of the C.B.E. & C. Circular dated 24-9-1992.
(b) In the event of the Supreme Court reversing the decision of the Madhya Pradesh High Court in Raj Pack Well’s case, or making any other order which will have the effect of changing the classification in regard to the said goods, the respondents will be entitled to change the classifications and make assessments to bring them in consonance with the decision of the Supreme Court.
(c) The excess amounts, if any found to have been received from the petitioners towards excise duty on account of the acceptance of the classification under Chapter 39, shall be ascertained and held in a separate account by the Assessing Authorities. If the Supreme Court upholds the classification as per the classification sought by the petitioners, then the respondents shall consider the claims for refund made by the petitioners in accordance with law; otherwise they shall be appropriated towards the difference in duty payable by the petitioners.
(d) The Bank Guarantee, wherever submitted, in pursuance of the interim order of the Court, shall be discharged and returned to the respective petitioners.
With these observations and directions, the petitions are disposed of.