TMI Blog2022 (9) TMI 1561X X X X Extracts X X X X X X X X Extracts X X X X ..... chloride as that is the single dash entry preceding the CTH in which the classification has been held. Having held, so revenue cannot for deciding the claim to exemption, hold a contrary view. The exemption at Sl 480, is admissible to all poly vinyl chlorides classifiable under heading 3904. Impugned order is set aside and the appeal allowed. - HON BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL) AND HON BLE DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL) Shri T. Viswanathan with Shri Akhilesh Kangsia, Advocates, for the Appellant Shri S.B. Hatangadi, Assistant Commissioner, Authorised Representative for the Respondent PER: SANJIV SRIVASTAVA This appeal is directed against Order-in-Appeal No. 191 (Gr.II-G)/2013 (JNCH)/IMP-147 dated 05.03.2013 passed by the Commissioner of Customs (Appeals), JNCH, Nhava Sheva. By the impugned order, following has been held: I uphold the Order in Original No. 1446/2012AM(I) dated 04.05.2012 and reject the appeals no's. S/49 -422/2012 Misc. /JNCH dated 07.06.2012. 2.1 Appellant filed Bill of entry No. 6170246 dated 05.03.2012 for clearance of import of goods declared as PVC Compound TZ (hereinafter referred to as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it refers to all forms and grades of PVC, falling under heading 39.04. The addition of the plasticizer, filler and stabilize does not chemically modify the nature of PVC resin. HSN Explanatory notes to Heading 39.04 itself provides that in order to improve the properties of PVC, commonly, plasticizers, fillers, and stabilizers are added. The relevant portion of HSN explanatory notes reads as under: Component Percentage-Composition Nature of Component PVC resin 63% Resin Diundecil Phthalate 21% Plasticizer Calcium Carbonate 10% Filler Ca/Zn Stabilizer 6% Stabilizer PVC is rigid colorless material with limited heat stability and with a tendency to adhere to metallic surfaces when heated. For these reasons, it is often necessary to add stablisers, plasticisers, extender and fillers, etc. to make useful plastics... Even after addition of these in the resin, it is still categorized and classi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ducts of a compounding process wherein the constituents went through a mixing process and produced a compound known PVC Compound T2 or CBB/9900/30F this is a distinctly identifiable product having identifiable physical and chemical characteristics. Hence, there is no doubt that the impugned goods are chemically modified goods. Apart from their bland claim, the Appellant has not adduced any technical evidence to support their claim that the impugned goods are polymers of vinyl Chloride. The appellate Authority has rejected the classification claimed by the Appellant by relying on the chemical composition of the impugned goods, specified in the Material data sheet. A tariff heading, based on composition of goods, is also specific heading like a heading based on commercial nomenclature. The basic reasoning of Original Adjudicating Authority as well as the Appellate Authority was that the Appellant has failed to establish that the impugned goods are Polymers of Vinyl Chloride. In the absence of any conclusive technical evidence both authorities have placed the impugned goods in the category which includes all categories. It is admitted fact that the Appellant/importer while claimi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... process is called compounding. The functional additives used in all PVC materials include neat stabilizers, lubricants, and in the case of flexible PVC, plasticisers, Optional additives include a range of substances from processing aids, impact modifiers, thermal modifiers, UV stabilizers, flame retardants, mineral fillers, pigments, to biocides, and blowing agents for specific applications. Teknor Apex- Leading Manufacturer of PVC Compound o A compound is defined as a substance formed when two or more elements are chemically bonded together. But how does PVC resin transform to vinyl compound? New compound formulations are developed to meet an application requirement or a processing limitation. Chemists and formulation engineers create custom compounds by blending a variety of additives, modifiers and stabilizers with PVC resin to achieve specific properties. o PVC resin has a nebulous structure and inherently exhibits fire retardant and chemical resistant properties. Custom rigid, flexible and blended vinyl compounds are formulated by mixing vinyl resin with a variety of plasticizers, stabilizers and modifiers to achieve certain properties - scuff and mar resis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound T2 after the compounding process still remains Polymer of Vinyl Chloride or not. I have enclosed in my synopsis technical literature available in the website of manufacturers of PVC Compounds which conclusively prove that PVC Compounds are chemically modified substances. Reliance is also placed on the decisions as follows: o Mysore Metal Industries {1988 (36) ELT 369 (SC) o Dilip Kumar and Company [2018 (351) ELT 577 (SC)] 4.1 We have considered the impugned order along with the submissions made in the appeal in the appeal and during the course of arguments. 4.2 For upholding the order in original Commissioner (Appeal) has observed as follows: 5.1 First, I will consider the contention of the appellants that the impugned goods are specifically covered under Sr. No. 480 to the Notification 21/2002 which allows concessional rate of 5% BCD. The above said Sr. No. read as under: Sr. No. CTH Description of the goods 480 3904 Polymers of Vinyl Chloride 5.2 I find that Sr. No. 480 of Notification covers only Polymer of Vinyl Chloride as enum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter Notes and subheading notes are the aid towards the classification of the goods and not for determining the eligibility to an exemption Notification. In the present case there is no dispute to the classification of the goods and classification as claimed by the appellants under heading no 39042290 has not been amended/ modified by the lower authorities. Further during the argument both the sides have relied upon HSN explanatory notes and technical literature to establish that the impugned goods are/ are not poly vinyl chloride . We do not find any merits in the submissions made because the classification of the goods have been made under 3904, which is reproduced below: 3904 POLYMERS OF VINYL CHLORIDE OR OF OTHER HALOGENATED OLEFINS, IN PRIMARY FORMS 3904 00 - Poly (vinyl chloride), not mixed with any other substances: 3904 10 10 --- Binders for pigments 3904 10 90 --- Other - Other poly vinyl chloride 3904 21 -- Non-plasticized 3904 21 --- Poly vinyl chloride resins 3904 21 90 --- Other 3904 22 -- Plasticized: 3904 22 10 --- Poly (vinyl chloride) (PVC) Resins (emulsion grade) 3904 22 90 --- Other From the above it is quite evident that by class ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncessional rate of duty of 7.5% on all goods falling under 3901 to 3915 except 3908. When two rates are specified in a notification for a product, the assessee is entitled to the benefit of that exemption, which gives him greater relief regardless to the fact that the notification as general in terms or other notification is more specific to the goods as held by the Hon ble Apex Court in the case of HCL Ltd. (supra). Similarly, in the case of Commissioner of Sales Tax, the Hon ble Bombay High Court held that the term milk would ordinarily include milk in all its forms including evaporated or dehydrated milk or milk powder. Even though the said decision pertains to Bombay Sales Tax Act, the ratio of the decision would apply to the facts of the present case. Accordingly, it is held that the expression polymers for vinyl chloride used in the notification would cover all forms/types of PVC. The decision of the Tribunal in the case of Henkel Teroson India Ltd. (supra) also supports the above view. The question, which arose for consideration in that case, was whether co-polymers of vinyl chloride/vinyl acetate would fall under the broad category of polymers of vinyl chloride under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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