TMI Blog1994 (8) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... een provided to include liquid or pasty (including emulsions, dispersions and solutions) forms and, therefore, why the refund claim pertaining to the period from 1-3-1982 onwards be not rejected and why the duty on the excess clearance value of Rs. 1,52,109.95 (after the allowance of Rs. 7,50,000) at nil rate of duty under Notification No. 83/83 dated 1-3-1983 for the year 1984-85 be not recovered was issued. In reply, it was contended by the appellants that in or about July, 1979, the appellants were granted an excise licence to manufacture the subject product, namely, Morarfloc and they classified the subject product under Tariff Item 68 as then in force. Thereafter, on or about 26th February, 1981 samples of the subject product were drawn by the Department and on the basis of the said report, two Show Cause Notices dated 22nd July, 1981 and 19th August, 1981 were issued to the appellants to show cause as to why the subject product be not classified under Tariff Item 15A. A demand for short term was also raised. The Assistant Collector adjudicated the same and confirmed the demand by his order dated 20-3-1986. Against that order of the Assistant Collector, the appellants filed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and the appellants do not undertake any process of dehydration whatsoever in respect of the said product. He also took us through the unamended Tariff Item 15A as well as to the amended Tariff Item 15A and submitted that Explanation III to Tariff Item 15A introduced on account of the change in the said Tariff Item did not in any way enlarge the scope of the said Tariff to include in its ambit any product which is not a resin and cited the case of Chemicals Fibres (India) Ltd. v. Union of India, 1982 E.L.T. 917 (Bom.) and Indian Plastics Chemicals Private Ltd. v. Union of India, 1981 E.L.T. 108 (Del.). He also took us through the letter dated 7th January, 1982 (certificate) of National Chemical Laboratory, Pune, and to the certificate of Analysis dated 19th August, 1981 issued by Italab Pvt. Ltd. and also to the affidavit of Dr. S.P. Potnis dated 24th February, 1983 to show that the subject product is not synthetic resin as it does not contain 50% or more of solids. As regards the report of the Deputy Chief Chemist referred to by the Collector (Appeals) in his impugned Order, he submitted that only the extract of the said report was supplied to the appellants and not the full ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e liquid or pasty material (including emulsions, dispersions and solutions) are made classifiable under Tariff Item 15A. With regard to the submission of the appellants that the earlier Order-in-Appeal passed by the Collector (Appeals) became final and, therefore, the present proceedings were not maintainable, he submitted that the issue of the classification could be reopened with the change in the Tariff Item and, therefore, the present case was rightly adjudicated upon and the authorities below confirmed the demand only from 1-3-1982, that is to say, when there was a change in Tariff Item 15A with the passing of the Budget, 1982. 6. We have considered the submissions. 7. Before we advert to the controversy in hand it would be advantageous to reproduce Tariff Item No. 15A as it existed before and after the change on the passing of the Budget, 1982 :- ****** 8. From a reading of the said Tariff Item 15A(1) as it existed before the change by the Budget of 1982 and thereafter, it is clear that, the description of the goods in column No. 2 stands substantially changed w.e.f. 1-3-1982. Prior to change in 1982, the description of the goods in Tariff Item 15A(1) so far as releva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia, supra, and the decision rendered by the Bombay High Court in the case of Chemicals and Fibres India Ltd. v. Union of India, supra, classified the subject goods, namely, Morarfloc under erstwhile Tariff Item 68 and not under Tariff Item 15A, as it stood at that time. From the copy of the said order of the Collector (Appeals) filed by the appellants themselves and is on our record (Exhibit `A - Page 22 of the paper book), we find that while holding that the subject product, namely, Morarfloc is a solution of resin, the Collector (Appeals) also referred to the certificate given by the National Chemical Laboratory, Department of Chemical Laboratory and ITALAB Pvt. Ltd. (which are dated 7th January, 1982 and 19-8-1981 respectively) which were also referred to by the learned counsel for the appellants before us, as aforesaid. From the said order of the Collector (Appeals), we further find that the report of the Deputy Chief Chemist (which is dated 26-2-1981) wherein he had opined that the subject product, namely, is in the form of Jelly like mass. It is aqueous paste of synthetic resin (polylanylamide type) was also referred to by the Collector (Appeals) in his said Order dated 16- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he meaning of the aforesaid Tariff Item 15A) inter alia stated that Solution of artificial or synthetic resin in volatile organic solvent are excluded from the scope of this item, if and when the weight of such solvent exceeds 50 per cent of the weight of the solution and held that the solution of resin which was the subject matter of dispute before the Court could not be classified as resin under Item 15A; firstly because it [Item No. 15A(1)] refers to the resin as fully manufactured and not any `solution of resin , and secondly, if more than 50 per cent weight is that of solvent then the product cannot be regarded as `resin at all. To which it may be answered that the present Tariff Item 15A does not lay down any limit for solvent contained and the description of the product is artificial or synthetic resin and Explanation III to it expressly and specifically mentions that sub-item (1) of Tariff Item 15A is to be taken to apply to materials in the liquid or pasty (including emulsions, dispersions and solutions) forms. The Assistant Collector of Central Excise in the instant case has also observed that the subject product is solution in the form of liquid and ambit of the wor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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