ORDER
Gowri Shankar, Member (T)
1. Appeals taken up for disposal, after waiving deposits.
2. The common question for consideration in these appeals is the excisability of pieces comprising mosaic tiles and if necessary the classification in the tariff. In the order impugned in the appeal, the Commissioner has held this to be marketable excisable goods and ordered their confiscation under heading 69.05 of the Tariff.
3. The representative of the appellant explained to us the process of manufacture of mosaic tiles. A mixture of silica, stone powder, mineral substances is round and China clay added and a slurry made by addition of. The slurry is processed so as to remove metallic and other impurities and filter pressed so as to remove water. The resultant cake is dried, granulated and pressed to form small pieces of different sizes and shapes. It was stated that these pieces are not larger than 5 centimetres in any dimension. They are then fired. After discarding the rejects, the remaining pieces are sorted out their different shapes and the required pieces placed in a mould which has on it the shape of the final mosaic. Once the required shape is obtained a sheet of paper is pasted on it, as backing the tile removed, packed and despatched. We are concerned with the liability to duty of the individual pieces which, after being baked or fired are used to form the final mosaic cake.
4. Notices were issued holding these to be excisable. It was the assessee’s contention before the Commissioner that these were not marketable and are not sold by any body else, nor purchased as such. The same contention was repeated before us.
5. The Commissioner agrees with the appellant that it does not sell these goods. He also does not say that any body else sells or purchases them. He says that what emerges from the furnace are tiles recognisable as such. The different types and shapes of such tiles are arranged in a particular manner and pasted on the packing only for convenience for obtaining a required design. These arguments were emphasised before us by the departmental representative who added that it was possible for any individual customer to buy each of the shapes and size in question and thereafter to assemble them into a design of his choice.
6. The classification of the finished product manufactured by the appellant, tiles with the backing on them has been decided under heading 68.07 of the Tariff by the Tribunal in its decision in C.C.E., Vadodara v. Shon Ceramics Ltd. (Appeal E/1875/87-D) 1996 (84) E.L.T. 502 (Tribunal). There is no dispute that what is sold are tiles assembled from shapes and sizes of tiles in a composite pattern, held to be together by backing. This is what the appellant says a mosaic tile.
7. However, if it is to be held that each of the pieces forming part of a tile is itself marketable, it has to be shown that each such pieces is actually capable of being bought and sold. We agree with the departmental representative that the mere fact that the appellant does not sell the goods does not mean that the goods are not marketable. However, it has to be shown that these or similar goods manufactured by any other manufacturer are in fact taken to the market for being brought and sold. There must be at least one buyer and one seller. The Commissioner’s order is entirely on the assumption that these goods could be so sold and that their subsequent arrangement in the mould and affixing backing is only for the sake of convenience. He has not rebutted the argument implicit in the appellant’s contention before him that the commodity that was marketed was the tiles comprising the pattern known as “mosaic”. It may be true that the backing is obtained on the pattern formed for the sake of convenience. It is perfectly possible in theory for the aggregation of the tiles in question to be sold packed in boxes, for example, to be put into required design at the premises of the user and thereafter laid. The cost and inconvenience involved in such a process could however be well imagined.
8. It is necessary at this point to consider the meaning of the term “mosaic tile”. The expression is not used in the tariff. However, Notification 5/99 which at serial No. 175 of the table to if classifiable under Chapter 68.07 defines it as tiles known commercially as mosaic tiles. If the final product sold by the appellant is commercially known as mosaic tiles, and known so only because the tile is sold and the combination in which it will be laid on a floor or a wall, each of the individual pieces would not be classifiable as the final product merely by virtue of Rule 2(a) of the Interpretative Rules. It was necessary for us to mention the above facts in order to deal with the contention of the departmental representative that by virtue of application of Rule 2(a) individual pieces of tiles will have to pay duty.
9. The question is also significant, and has to be dealt with for another reason. There is no dispute that each of the small pieces with which we are concerned is given a particular shape and size before it is fired. The mosaic or final pattern which is formed by putting the tiles together is however obtained only by putting together the pieces according to the predetermined pattern in the mould. Note 2 to Chapter 69 provides for classification in that chapter only of products which has been fired after shaping. If the mosaic tiles, as commercially known, acquired a shape only by forming into a design in the mould they will not be classifiable under Chapter 69 and they would be classifiable under Chapter 68. In fact, the Tribunal, in the order cited above, had taken note of this position in approving the classification ordered by the Collector of the mosaic tiles under Heading 68.07. However, as the departmental representative points out this specific point as to whether the goods only acquired the identity of mosaic tiles after arrangement into the mould and affixed with backing was not under consideration. Strictly speaking, these points are not under consideration in the Commissioner’s order either. However, these are points, in our view, which have necessarily to be dealt with in order to deal with the excisability and the classification. Each of the individual pieces obtained is fired. If each of these held to be excisable commodity, it would be classifiable under Heading 69.05 since it has been shaped before firing. We are of the view that these aspects are required to be gone into with regard to individual pieces for deciding the marketability and classification of individual pieces.
10. We note for the record that we were not able to accept the contention of the representative of the appellant that the pieces are not shaped before firing but are only pressed. There is no denial that the granules obtained from the pressed cake are pressed in dyes in order to obtain a particular shape and size. Such size and shape being dictated by the requirement of the pattern of the final product.
11. Accordingly, we allow the appeals and set aside the impugned order. The Commissioner shall adjudicate afresh on these matters according to law. In the peculiar facts of this case, either side will be at liberty to adduce evidence in support of its contention.