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TMI Blog2018 (10) TMI 1532X X X X Extracts X X X X X X X X Extracts X X X X ..... er and its derivatives falling under Chapter 39 of the schedule of Central Excise Tariff Act, 1985. In the investigation, Shri Yogesh Chandradutt Dhariyal proprietor of M/s. Dhariyal Chemicals informed that he is the proprietor of M/s. Ganesh Enterprise also but is in the name and style of Shri Ganesh Dutt Joshi and he is carrying out all business activities of M/s. Ganesh Enterprises also. He further clarified that Shri Ganesh Joshi is the name of his cousin. On the basis of investigation, the department made out a case that M/s. Ganesh Enterprises is owned by proprietor Shri Yogesh Chandradutt Dhariyal and therefore, M/s. Ganesh Enterprises is not entitled for SSI exemption and all the clearances made by M/s. Ganesh Enterprises is liable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is ground itself. He further submits that even if the product manufactured by M/s. Ganesh Enterprises is considered as excisable, since the product manufactured by M/s. Dhariyal Chemicals held to be non dutiable under Chapter heading 47, the value of the same needs to be deducted from the total aggregate value for the purpose of exemption Notification No. 8/2003-CE dated 01.03.2003. Accordingly, on this ground also the clearances of M/s. Ganesh Enterprises being within the SSI exemption limit, duty demand is not sustainable. As regards the other appeals, he submits that all these appeals are consequential to main appeal wherein the demand is involved. He placed reliance on the following judgments:- (a) Vinod Solanki vs. UOI - 2009 (233) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... important, which are as under :- "12. The question of classification is taken up first. The appellants have relied upon the HSN Explanatory Notes under Chapter 47. As per these Notes, the pulp of Chapter 47 consists essentially of Cellulose fibres obtained from various vegetable materials, or from waste textiles of vegetable origin. As per the HSN Notes, other materials which may be used for making pulp include Cotton Linters, rags of cotton, liner, or hemp and other textile wastes such as old ropes, straw, esparto, flax, ramie, jute, hemp, sisal, bagasse, bamboo and various other grasses and reeds, waste and scrap of paper etc. Further as per HSN Notes the pulp can be in the form of powder. Therefore, the ingredients are polysaccharides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further supported by the decision of the Tribunal in the case of Samson Rubber Industries v. CC - 2005 (185) E.L.T. 419 in which also a product consisting of cellulose fibres was held classifiable under Chapter 47 as against Chapter 38. 14. The Assistant Commissioner has in his order held that the appellants' product which is purchased by ONGC is added to mud during oil drilling to increase the viscosity of the mud. He has proceeded on the basis that since the product increases the viscosity of the mud, it has chemical properties. The said conclusion of the Assistant Commissioner is not correct. The property of increasing viscosity is a mere physical property which does not involve any chemical process or reaction. It cannot be termed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w that the process of manufacture as explained and considered by the first appellate authority was incorrect and the ingredients which have gone into the manufacturing of LCCA are not the same as has been recorded. In our view, on a question of fact which indicate that the product LCCA is a product derived from cellulosic fibre, we find that the classification of the said product under Chapter 47 as held by first appellate authority is a correct view. 10. We also find that the first appellate authority has held that the Assistant Commissioner has relied upon the opinion of the chemical examiner which indicates that the products are not classifiable under Chapter 47.01. In our view, the first appellate authority was correct in recording th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so the same. Therefore, in view of the judgment of this Tribunal in the case of Dhariyal Chemicals (supra) the product in the appellant's case is also clearly classifiable under Chapter heading 47 which attracts nil rate of duty. Therefore, there is no need to go to the question of limit of SSI exemption. As the judgment of the Tribunal in the case of Dhariyal Chemicals stands accepted by the department, therefore, classification of the product Cellulose powder attained finality. It is also observed that since, the department's proposal is to club the clearances of M/s. Dhariyal Chemicals and M/s. Ganesh Enterprises, but the clearances of M/s. Dhariyal Chemicals has been held as nil rated under Chapter heading 47, therefore, the same needs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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