TMI Blog1993 (12) TMI 133X X X X Extracts X X X X X X X X Extracts X X X X ..... Plastics claiming exemption under Notification No. 132/86 and amended by Notification No. 53/88. Classification Lists effective 9-10-1987, 1-3-1988, 13-7-1988 and 16-8-1988 approved under 3926.90 by the Asstt. Collector. Classification was on the basis of Order-in-Appeal No. 60-DLH/87 dated 27-2-1987 passed by the Collector of Central Excise (Appeal), Delhi who classified these products under the then 3922.90 as Articles of Plastics (Deptt. Appeal E/1653/87-B.1) in the case of M/s. Densons Engineers. 3926.90 is equivalent to the earlier 3922.90. Asstt. Collector by Order-in-Original No. 4/AC/CL/89 dated 20-6-1989 decided Classification List retrospectively under 8547.00. In the meantime Addl. Collector issued Show Cause Notice on 30-9-1988 for period 1986-87 and 1987-88. Charges were 2- (i) Extended period - Misclassification. (ii) Clubbing of 2 units viz. M/s. Densons Engineers and M/s. Densons Pultroteknik. Order-in-Original dated 13-6-1989 confirmed demand of Rs. 1,79,921.79 and penalty of Rs. 20,000 for 1986-87 and 1987-88. We are in appeal before CEGAT bearing No. E/3405/89-C (It was earlier in C Bench but now transferred to B.1 vide Misc. Order No. 207/92-C, dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as dutiable under Heading 85.47 vide Asstt. Collector s Order No. 4/AC/CL/89 dated 20-6-1989, w.e.f. 13-1-1989 that is, the date of the show cause notice. 5. In the Orders-in-Appeal it has been held (i) That the value of the Epoxy cast components is not includible for the purpose of determining the availability of the exemption w.e.f. 1-3-1989 and 1-4-1989 as these products have been held dutiable only w.e.f. 13-1-1989; and (ii) The value of clearances of two units was not to be clubbed as decided vide Order-in-Appeal No. 175-176/CE/CHD/90 dated 28-12-1990 (which are the subject matters of the Department s Appeal Nos. 1664-1665/91-B). 6. In view of these findings, the exemption under Notification No. 175/86-C.E. dated 1-3-1986 has been extended to the two units as the value of the clearances has been held to be less than Rs. 1.5 crores/2 crores respectively. 7. Appeal Nos. 1664-1665/91-B1 have been filed by the Deptt. against Orders-in-Appeal Nos. 175-176/CE/CHD/90 dated 28-12-1990 allowing two appeals filed by the M/s. Densons Pultroteknik, Paonta Sahib unit against Order-in-Original No. 4/AC/CL/89 dated 20-6-1989 passed by the Asstt. Collector holding Epoxy cast component ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... metal. 13. It is not disputed that the impugned goods are insulating fittings for electrical machines but what is claimed is that these are not made wholly of insulating material since it is claimed that only the Epoxy Resins is the insulating material and to which plasticisers, fillers etc. have been added allegedly for the purpose of bringing down the cast. This argument is not tenable because as seen from Kirk-Othmer Encyclopaedia of Chemical Technology under heading Insulation (Electric): Although the function of an insulator is to restrain current flow from a conductor to ground or to a lower potential, insulations often must provide mechanical support, protect the environmental degradation and transfer heat to the surrounding environment. In this behalf it is seen under the heading Thermal Conductivity , ibid. The addition of fillers (qv) to resins improves their thermal conductivity. Metallic fillers are best but detract from the electrical properties. Inorganic fillers whose particles are rodlike or leaflike improve the thermal conductivity more than spherical particles because of the improved contact area from particle to particle. High filler contents must ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation of Cable Jointing Kit" made of insulating material has been decided by the Bombay High Court under Heading 85.47 in the case of X.L. Telecom Pvt. Ltd. v. UOI - reported at 1993 (47) ECR 171 (Bombay). 21. In view of the said Bombay High court decision and for the reasons given above, the Epoxy Cast Components are rightly classifiable under Heading 85.47. 22. The second issue required to be decided is whether the clearance of the two units are to be clubbed for the purpose of eligibility to exemption under Notification No. 175/86-C.E. dated 1-3-1986. As seen from the Notification No. 175/86-C.E. the exemption is for excisable goods of the description specified in the Annexure to the Notification cleared by a manufacturer from one or more factories . 23. Vide clause a(i) a separate rate is prescribed where manufacturer avails of the Modvat Credit. 24. As the two units are admittedly owned by M/s. Yamuna Gases Ltd.; this is a case of clearances of excisable goods from one or more factories by or on behalf of the same manufacturer M/s. Yamuna Gases Ltd. Hence, the Tribunal decision in the case of M/s. Kinjal Electricals (P) Ltd. relied upon by the Ld. Adv. for the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1-3-1986. As pointed out for the purpose of clubbing of the clearances of two units, the Modvat facility and the availing of exemption are both with reference to clearances of the excisable goods from one or more factories by or on behalf of the Manufacturer. In view of this if one of the units belonging to a manufacturer avails of the Modvat facility, the second unit belonging to the same manufacturer viz Yamuna Gases, cannot avail of exemption under Notification No. 175/86-C.E. for the same goods particularly, if the combined clearances of the two units exceed the maximum prescribed unit, says Rs. 30 lacs in the present appeals. 32. In view of the foregoing, the various issues are decided as follows : Epoxy Cast Components are classifiable under Heading 85.47 and the value of clearances of such components will be includible in the combined value of clearances of the two units for the purpose of Notification No. 175/86-C.E. and the units will not be eligible for the benefit of Notification No. 175/ 86-C.E. as their combined value of clearances including, inter alia, that of Epoxy Cast Components had exceeded Rs. 1.5 crores/2 crores respectively in the two financial years; and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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