Central Excise - Heading No. 27.13 of C.E.T. - Levy of excise duty on air-blown grade bitumen produced from duty paid straight-grade bitumen - Clarification regarding - Central Excise - 88/1/88-CX.3

Central Excise - Heading No. 27.13 of C.E.T. - Levy of excise duty on air-blown grade bitumen produced from duty paid straight-grade bitumen - Clarification regarding F. No. 88/1/88-CX.3 Dated 1-7-1988 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Central Excise - Heading No. 27.13 of C.E.T. - Levy of excise duty on air-blown grade bitumen produced from duty paid straight-grade bitumen - Clarification regarding. Attention is invited to Board's F. No. 88/1/87-CX.3, dated 16-6-1987 whereunder it had been clarified that both straight-grade bitumen of petroleum and blown-grade bitumen of petroleum would be classifiable either under sub-heading No. 2713.21 or 2713.22 of the new CET, depending upon whether those are packed in drums or in bulk and that no duty would be chargeable on blown-grade bitumen of petroleum if made out of duty-paid straight-grade bitumen of petroleum. It was also pointed out therein that the same position prevailed under the old CET. 2. It has now been brought to the notice of the Board that, in certain cases, the manufacturers are bringing duty-paid straight-grade bitumen of petroleum in bulk out of which they are producing blown-grade bitumen of petroleum and clearing such blown-grade bitumen of petroleum in drums. It has been pointed out that, in such cases, duty would perhaps be leviable since the blown-grade bitumen of petroleum cleared in drums would fall under sub-heading No. 2713.21 whereas the duty-paid straight-grade bitumen of petroleum in bulk, but of which such blown-grade bitumen of petroleum in drums has been produced, would fall under sub-heading No. 2713.22. 3. The matter has been examined. It is observed that the problem did not arise under the old CET because both straight-grade bitumen of petroleum and blown-grade bitumen of petroleum, irrespective of their modes of packing, were classifiable under T.I. 11(4) of the old CET. In the HSN also, all petroleum bitumens, irrespective of their modes of packing, are classifiable under the HSN sub-heading No. 2713.20. The new CET has been made a departure from the HSN in respect of petroleum bitumens by making their modes of packing a criterion for their classification under different sub-headings. 4. After examining the issues involved carefully, the Board has taken the view that duty would be chargeable on blown-grade bitumen of petroleum where the blown-grade bitumen of petroleum falls under a sub-heading different from the sub-heading under which the duty-paid straight-grade bitumen of petroleum, from which such blown-grade bitumen of petroleum has been produced, falls because of variations in their modes of packing. However, where the duty-paid straight-grade bitumen of petroleum out of which the blown-grade bitumen of petroleum has been produced and the blown-grade bitumen of petroleum so produced fall under the same sub-heading, because of the same mode of packing no duty would be chargeable on such blown-grade bitumen of petroleum. The instructions contained in Board's letter F. No. 88/1/87-CX.3, dated 16-6-1987 may be treated to have been modified to this extent. The trade interests may also be suitably advised. All pending assessments may be finalised on the above basis.