1992(12)LCX0050

BEFORE THE CEGAT, SPECIAL BENCH ‘C’, NEW DELHI

S/Shri G.P. Agarwal, Member (J) and N.K. Bajpai, Member (T)

COLLECTOR OF CENTRAL EXCISE

Versus

KOHINOOR RUBBER MILLS

Final Order Nos. 374 and 375/92-C, dated 16-12-1992 passed in E/A Nos.1669-70/92-C

CASES CITED

M/s. Golden Rubber and Cable Corporation — Order No. 418-419/1981.......................... [Para 3]

Popular Rubber Mills — Order in appeal No. 32-33-C.E./89............................................... [Para 3]

Indo International Industries v. Commissioner — 1981 (8) ELT 325................................ [Para 6]

Dunlop India Ltd. & Madras Rubber Factory Ltd. v. U.O.I.
— 1975(10)LCX0016 Eq 1983 (013) ELT 1566 (SC) ........................................................................ [Paras 6, 10, 19]

Union Carbide India Ltd. v. U.O.I. — 1986(04)LCX0022 Eq 1986 (024) ELT 0169 (SC)......................................... [Para 6]

Atul Glass Industries Ltd. v. Collector — 1986(07)LCX0018 Eq 1986 (025) ELT 0473 (SC) ............................ [Paras 6, 9]

Brakes India Ltd. v. Collector — 1987(08)LCX0099 Eq 1987 (031) ELT 1030 (T) ................................................ [Para 6].

Collector v. Bhor Industries Ltd. — 1988(04)LCX0047 Eq 1988 (035) ELT 0346 (SC) .................................... [Paras 6, 22]

Collector v. Krishna Carbon Paper Co.— 1988(09)LCX0051 Eq 1988 (037) ELT 0480 (SC).................................... [Para 6]

Inarco Ltd. v. Collector — 1987 (031) ELT 469.................................................................... [Para 6]

Solder Industries v. Collector — 1988 (038) ELT 529 .......................................................... [Para 6]

Track Parts Corporation v. Collector — 1992 (057) ELT 98................................................. [Para 7]

Collector v. Aerolax Hose Pvt. Ltd. — 1989 (039) ELT 681 ........................................ [Paras 7, 25]

Bharat Forge & Press Industries v. Collector — 1990(01)LCX0072 Eq 1990 (045) ELT 0525 (SC).................. [Paras 7, 18]

Indian Metals & Ferro Alloys Ltd. v. Collector — 1990(11)LCX0014 Eq 1991 (051) ELT 0165 (SC)... [Paras 7, 14, 17, 22]

Indian Aluminium Cables Ltd. v. U.O.I — 1985 (021) ELT 3 .................................... [Paras 7, 13]

Collector v. Krishna Carbon Paper Co.— 1988(09)LCX0051 Eq 1988 (037) ELT 0480 (SC).................................... [Para 7]

Kores (India) Ltd. v. Collector — 1987 (029) ELT 627 ........................................................ [Para 7]

Industrial Factors Ltd. v. Collector — 1988 (12) E.T.R. 27................................................... [Para 7]

Collector v. Sundaram Fasteners — 1985 (022) ELT 923 .................................................... [Para 7]

Precision Rubber Industries v. Collector — 1990 (049) ELT 170............................ [Paras 7, 29, 30]

Indian Aluminium Cables Ltd. v. U.O.I. — 1982 (010) ELT 467 ..................................... [Para 12]

Collector v. Sundaram Fasteners Ltd. — 1985 (022) ELT 923 .......................................... [Para 21]

Advocated By : Smt. Vijay Zutshi, CDR, for the Appellant.

S/Shri R. Nambirajan and V. Sridharan, Advocates, for the Respondents.

[Order per: N.K. Bajpai, Member (T)]. - These two appeals are directed against a common order of the Collector of Central Excise, (Appeals), Chandigarh, involve the common question of classification of Rice Rubber Rolls, were heard together and are being disposed of by this common order. While the goods have been held to be classifiable under sub-heading 4009.99 of the Schedule to the Central Excise Tariff Act by Collector (Appeals), the Revenue contends in these appeals that the correct classification should be under sub- heading 4016.99. The two sub-headings are as under :-

2. The dispute about the classification of Rice Rubber Rolls arose out of claim of both the appellants for classification under sub-heading 4009.99 as Tubes, Pipes and hoses in their Classification Lists dated 5-5-1987. The Assistant Collector did not accept this claim, and, after issuing them a show cause notice and receiving their reply, decided as under :-

“FINDINGS:-

I observe that the rice rubber rolls are used for shelling the rice in the rice milling industry and are distinctly sold and know in the trade as ‘Rice Rubber Rolls". Rice Rubber Rolls cannot be considered fatting under the description of Tube and Pipe. Since Tubes and Pipes are generally used as a conductor/conveyor of liquids fluids, gas and the like. Rice rubber rolls do not perform any such function. Rice Rubber Rolls are, therefore, correctly classifiable under heading 40.16 sub-heading 4016.99 as other articles of rubber." (Emphasis added)

3. Against this order, appeals were filed. Collector (Appeals) set aside the order of the Assistant Collector and decided the classification to be under sub-heading 4009.99 as tubes and pipes. She placed reliance on the following evidence while setting aside the order of the Assistant Collector :-

(a) Order No. 418-419/1981 of the Central Board of Excise & Customs in the case of M/s. Golden Rubber and Cable Corporation of Haryana in which it was decided that rubber rolls used as component parts of Rice Shellers were classifiable under Item 16A(iii) of the erstwhile Central Excise Tariff as piping and tubing and exempt from duty under Notification No. 197/67-C.E., dated 29-8-1967. Similar view was taken in

(b) Order-in-Appeal No. 32-33-CE/89 of the Collector of Central Excise (Appeals), New Delhi in the case of M/s. Popular Rubber Mills, Rasoi (Haryana).

4. It is against the order of Collector (Appeals) that the present appeals have been filed to the Tribunal claiming that the correct classification of the Rice Rubber Rolls should be under sub-heading 4016.99 as “Other Articles of Vulcanised Rubber” and not as “Other Tubes, Pipes and Hoses of Vulcanised Rubber” under sub-heading 4009.99.

5. We have heard Smt. Vijay Zutshi, the learned Chief Departmental Representative and Shri V. Sridharan, the learned Counsel for the two respondent Companies. Smt. Zutshi has placed reliance on a letter/ dated 13th July, 1992 from the Assistant Collector of Central Excise, Jalandhar explaining the process of manufacture of the subject goods by one of the respondents. According to this, rubber sheets are wrapped on the Malleable Steel Shells with the help of a wrapping machine. The inner diameter of the subject goods depends upon the diameter of M.S. Shells and the outer diameter depends upon the quantum of rubber wrapped on the MS Shells. These M.S. Shells with the rubber wrapped on them are removed from the wrapping machine, are cured in a hydraulic press and then vulcanised in open steam vulcanisers. Thus, rubber rice rolls are formed. Sometimes, rice rubber rolls of required length are manufactured by cutting to smaller length from bigger rolls.

6. Smt. Zutshi has, while presenting her case, relied upon the following decisions :-

(a) Indo-International Industries v. Commissioner of Sales Tax, U.P. (para 4) 1981 (8) ELT 0325 (SC)

(b) Dunlop India Ltd. & Madras Rubber Factory Ltd. v. Union of India & Others [1975(10)LCX0016 Eq 1983 (013) ELT 1566 (SC) (para 36)]

(c) Union Carbide India Ltd. v. Union of India & Others [1986(04)LCX0022 Eq 1986 (024) ELT 0169 (SC) (para 4)]

(d) Atul Glass Industries Ltd. & Others v. Collector of Central Excise [1986(07)LCX0018 Eq 1986 (025) ELT 0473 (SC) (paras 8 & 11)]

(e) Brakes India Ltd. & Others v. Collector of Central Excise [1987(08)LCX0099 Eq 1987 (031) ELT 1030 (Tribunal) (para 222)]

(f) Collector of Customs v. Bhor Industries Ltd. [1988(04)LCX0047 Eq 1988 (035) ELT 0346 (SC) (para5)]

(g) Collector of Central Excise, Kanpur v. Krishna Carbon Paper Co. [1988(09)LCX0051 Eq 1988 (037) ELT 0480 (SC) (para 8)]

(h) Inareo Ltd. v. Collector of Central Excise, Bombay [1987 (031) ELT 469 = 1984 (Vol. IV) ECR 2164 (Tribunal)]

(i) Solder Industries, Bombay v. Collector of Customs, Bombay [1988 (038) ELT 529 = 1989 (13) ETR 440 (para 7)].

7. Shri Sridharan, on the other hand, has referred to the following other decisions :-

(a) Track Parts Corporation v. Collector of Customs [1992 (057) ELT 98]

(b) Collector of Central Excise v. Aerolax Hose Pvt. Ltd. [1989 (039) ELT 681]

(c) Bharat Forge & Press Industries (Pvt.) Ltd. v. Collector of Central Excise [1990(01)LCX0072 Eq 1990 (045) ELT 0525 (SC)]

(d) Indian Metal & Ferro Alloys Ltd. v. Collector of Central Excise [1990(11)LCX0014 Eq 1991 (051) ELT 0165 (SC)]

(e) Indian Aluminium Cables Ltd. v. Union of India [1985 (021) ELT 3]

(f) Collector of Central Excise, Kanpur v. Krishna Carbon Paper Co. [1988(09)LCX0051 Eq 1988 (037) ELT 0480 (SC)]

(g) Kores (India) Ltd., Thane v. Collector of Central Excise, Thane [1987 (29) ELT627]

(h) Industrial Factors Ltd. v. Collector of Central Excise [1988 (12) ETR 27] (i) Collector of Central Excise v. Sundaram Fasteners [1985 (022) ELT 923]

(j) Sundaram Clayton v. Collector of Central Excise [1990 (047) ELT 480]

(k) Precision Rubber Industries v. Collector of Central Excise [1990(03)LCX0033 Eq 1990 (049) ELT 0170 (Bombay HC)]

8. We have carefully considered the question of classification of ‘Rice rubber rolls’ under the competing sub-headings 4009.99 and 4016.91 of the Central Excise Tariff. The contention of the Revenue is that the subject goods are used for shelling rice in rice milling industry and are sold and known in the trade parlance distinctly as Rice Rubber Rolls and not as pipes and tubes. The fact that they have the shape of a pipe or tube cannot be determinative of their classification. The fact that they are made to particular sizes, perform specific function of shelling rice and are not known as pipes and tubes should determine their classification.

9. The learned CDR read out from the manufacturers’ own leaflet and invited attention to the fact that the goods had throughout been referred to as “Rolls” and not as ‘piping’ or ‘tubing’. To fortify her argument on this point, Smt. Zutshi referred to the manufacturers’ own leaflet which describes the subject goods thus :-

“SOONER OR LATER

KOHINOOR

will figure in your future

NOW

IS : 8427

ISI

marked

KOHINOOR

Rice Rubber Rolls"

[Emphasis added]

Reliance for her view has been placed on several decisions of the Tribunal and the Supreme Court according to which the test to be applied to such cases is :

How is the product identified by the class or section of people dealing with or using the product? To quote from Supreme Court judgment in the case of Atul Glass Industries Ltd. v. Collector of Central Excise [1986 (025) ELT 473] cited by the learned CDR (para 8):

“It is a matter of common experience that the identity of an article is associated with its primary function. It is only logical that it should be so. When a consumer buys an article, he buys it because it performs a specific function for him. There is a mental association in the mind of the consumer between the article and the need it supplies in his life. It is the functional character of the article which identifies it in his mind. In the case of a glass mirror the consumer recalls primarily the reflective function of the article more than anything else. It is a mirror, an article which reflects images.” [Emphasis added]

10. Smt. Zutshi had also cited the decision of the Supreme Court in the case of Dunlop India Ltd. v. Union of India [1975(10)LCX0016 Eq 1983 (013) ELT 1566], which being a judgment delivered in 1975, is one of the earliest on the ‘common parlance test.

To quote para 36:-

“36.....It is clear that meanings given to. articles in a fiscal statute must be as people in trade and commerce, conversant with the subject, generally treat and understand them in the usual course. But once an article is classified and put under a distinct entry, the basis of the classification is not open to question. Technical and scientific tests offer guidance only within limits. Once the articles are in circulation and come to be described and known in common parlance, we then see no difficulty for statutory classification under a particular entry.”

                                 [Emphasis added]

11. It is interesting that Shri Sridharan, the learned Counsel had also relied on the same judgment but for a different Contention - that the subject goods be classified under sub-heading 4009.99 - which is specific for pipes, tubes and hoses - in preference to the residuary entry 4016.1-other articles of vulcanised rubber. He relied on the oft-quoted observation of this judgement:

“37.....When an article has, by all standards, a reasonable claim to be classified under an enumerated item in the Tariff Schedule, it will be against the very principle of classification to deny it the parentage and consign it to an orphanage of the residuary clause. The question of competition between two rival classifications will, however, stand on a different footing.”

12. Smt. Zutshi had also assailed the order of Collector (Appeals) on the ground that there is a separate Indian Standards Specifications - IS 8427-1977 for Rubber Rolls for Paddy Dehusker and one for Rubber Tubings for General Purposes - IS 637-1965 and this itself would show that the two articles are commercially different. Shri Sridharan has contested this Claim on" the ground that the specifications are only for quality control purposes. He has placed reliance on the judgment of the Delhi High Court in Indian Aluminium Cables Ltd. v. Union of India [1982 (010) ELT 467] when it observed as follows :-

“19. Reliance on the specifications issued by ISI has also no relevance. Those specifications are only relevant for quality of goods. Those specifications do not change the nature of the goods.” [Emphasis added]

13. The Supreme Court had also rejected the argument of the appellant company that the ISI which prescribes specifications for various commercial commodities, has prescribed separate specifications for Properzi rods and aluminium wire rods. The observations of the Court in para 9 of its judgment in the same case [1985 (021) ELT p. 3] were as under :-

“9. The specifications issued by the ISI are for ensuring quality control and have nothing to do with the class to which the goods belong in a Tariff Schedule. Considering the use to which the Properzi Rods are put they may have to meet a different and higher quality control than the ordinary wire rods. But, that does not mean that Properzi Rods are not comprehended within the expression ‘wire rods’.” [Emphasis added]

14. The strongest argument which the learned Counsel made in support of his contention was the reliance placed by him on the judgment of the Supreme Court in the case of Indian Metals & Ferro Alloys Ltd. v. Collector of Central Excise [1991 (051) ELT 165] about the classification of poles for transmission of electric energy in which the Apex Court held that, considering the wide scope of Item 26AA(iv), such poles were classifiable as pipes. The question was one of classification between items 26AA(iv) and the residuary Item 68 of the erstwhile Central Excise Tariff. To appreciate the point, it is necessary to look at the tariff item:-

“26AA IRON OR STEEL PRODUCTS, THE FOLLOWING NAMELY:

(i) ..........

(ii) ..........

(iii) ..........

(iv) Pipes and tubes (including blanks thereof) all sorts, whether rolled, forged, spun, cast drawn, annealed, welded or extruded. [Emphasis added]

15. While discussing the rival contentions, Ranganathan, J. observed as under :-

“l3.....The language of Tariff Item No. 26AA is very wide. It covers iron and steel products of the descriptions set out therein. The sum and substance of the descriptions given by the Assistant Collector in the assessment order is only (a) that the poles produced by the appellant are not ordinary pipes and tubes which convey a fluid from one place to another and (b) that they are manufactured by a very elaborate and sophisticated process. So far as the first point is concerned, it will be appreciated that, just as pipes and tubes are generally intended to carry a fluid from one place to another, the poles with which we are concerned enable wires to be passed through them for the transmission of electric energy a function not very different in nature from that of other ordinary pipes and tubes. That apart, even tubes and pipes are not always necessarily used for such purpose. They can be used as flag-masts or for purposes of scaffolding or other purposes where they do not serve as a medium for the transmission of a fluid. This is not, therefore, a sound objection. In regard to the second point, it is perhaps sufficient to point out that sub-item (iv) of Item 26AA refers to pipes and tubes (including blanks thereof) all sorts, whether rolled, forged, spun, cast drawn, annealed, welded or extruded. It is comprehensive enough to take in all sorts of pipes and tubes and even those obtained by the processes of forging, drawing and so on. The ultimate product in the present case is merely a set of pipes or tubes of different diameters attached to one another by different methods. The so- called manufacture is nothing but the putting together of a number of pipes or tubes by one or other of the processes mentioned in the tariff item. The goods produced therefore, do not cease to be iron and steel products or pipes and tubes of the description mentioned in Item 26AA(iv). It may not be also correct to characterise them as a different commercial commodity. Some of them are called poles, an expression which means ”a long slender piece of metal or wood commonly tapering and more or less rounded". Electric poles, being hollow ones, are not much different from pipes or tubes. The statement that they are commercially distinct commodities is merely based on their being called ‘poles’. They are also available in the same market in which normally pipes and tubes are otherwise available. Neither the circumstance that certain processes are applied to the “mother” pipes or tubes nor the fact that, in order to identify the particular type of tube or pipe one needs, one may use different names is sufficient to treat me article as a commercially different commodity: See Indian Aluminium Cables Ltd. v. Union -1985 (021)’ELT 0003 (SC) = 1985 (3) SCC 284 followed and applied in Bharat Forge & Press Industries v. C.C.E. -1990(01)LCX0072 Eq 1990 (045) ELT 0525 (SC) = 1990 (1) SCC 532"

16. On a careful consideration of all the contentions raised before us we agree with the learned CDR that the matter must be decided on the basis of the common parlance test which has all along been upheld by the Supreme Court as the basic criterion for determining the classification of goods for purposes of the customs and central excise tariffs. We cannot go by the only fact that two different ISI specifications are in existence for Rice Rubber Rolls and Rubber Tubing for General Purposes. As between the specific sub-heading and the residuary sub-heading, we will first have to rule out the applicability of the specific sub-heading.

17. Once we apply these principles in the case of the subject goods, we find that the Revenue authorities have claimed that they are known as Rice Rubber Rolls and not as pipes and tubes. They have referred to the fact that they have particular sizes and perform specific function of shelling rice and are made to a particular ISI specification to conform to prescribed standards of quality. The manufacturer’s own leaflet supports this contention. The reliance on the Supreme Court judgment in the case of Indian Metals & Ferro Alloys Ltd. (supra) does not support the case of the respondents. The conclusion that poles were not different from pipes was based on several considerations which do not exist in the case of the present goods. The competing items in that case were Items 26AA(iv) and residuary Item 68. The Court held that the way the former was worded it covered all sorts of iron and steel pipes manufacture! by all conceivable processes. This is not the case with sub-heading 4009.99 which refers to :

“40.09 Tubes, pipes and hoses of vulcanised rubber with or without their fittings (for example, joints, elbows, flanges)”

and sub-heading

“4009.92 Designed to perform the function of conveying air, gas or liquid

4009.99 Other.”

18. If the language of the Heading and the sub-headings are carefully read, it would be clear that when contrasted with the language of Item 26AA(iv) which is very wide (and this has been observed by the Supreme Court itself), the expression in Heading 4009 confines itself to tubes, pipes and hoses with or without their fittings. This would mean that the scope of the Heading is specific for “tubes, pipes and hoses and their fittings” and articles like Rice Rubber Rolls which, though they may have a circular or cylindrical shape, which is what is common between them and tubes etc., cannot otherwise be regarded as tubes, pipes and hoses. This view is re-inforced by the fact that neither by their process of manufacture (and on this, the learned CDR had laid considerable stress during her arguments) nor by their specific sizes, or name, nor by their primary function (and there is a reference to the functions of the pipes etc. in sub-heading 4009.92) are the Rice Rubber Rolls known or marketed as tubes, pipes and hoses even though they may resemble their shape. That the shape of an article alone cannot be a sure guide for determining its classification can be seen from the fact that a “tube light”, though made of glass and having the shape of tube is not classifiable as a “glass tube” but as ‘light’ or ‘lamp’ because of its quality or function of providing illumination. It is therefore clear that “Rice Rubber Rolls” are a distinct commercial commodity - different from rubber pipes and tubes and have a distinct name, character and use different from that of rubber pipes, tubes and hoses. At this place we may also refer to the decision of the Supreme Court in the case of Bharat Forge & Press Industries (Pvt.) Ltd. v. Collector of Central Excise relied upon by the learned Counsel. The things which the Apex Court found to be common between pipes fittings on the one hand and pipes on the other, do not exist in the case of Rice Rubber Rolls and Pipes/tubes and hoses.

19. Once we have come to the conclusion that the subject goods do not answer the description of Heading 40.09, we have to examine whether they can be covered by any other Heading in Chapter 40 which specifically answers to their description before we can proceed to the residuary entry. This is the ratio of the Supreme Court judgment in the case of Dunlop India v. Union of India [1975(10)LCX0016 Eq 1983 (013) ELT 1566] cited by both sides before us. That none of the Headings 40.10 to 40.15 cover the subject goods is clear on a plain reading of the Headings and needs no discussion. We are, thus, led to 40.16 - “Other Articles of vulcanised rubber other than hardened rubber” which is within Chapter 40.

20. In case of poles, the Supreme Court had also held that the poles did not cease to be iron and steel products and could not, therefore, be taken to the residuary item of the tariff. That this test has also been applied to the subject goods is clear from the fact that even though they have been excluded from the purview of Heading 40.09, they have been retained as “Other articles of rubber” under Heading 40.16 and thus continue to be covered by Chapter 40. The position in the case of poles was different because they were totally excluded from Items 26AA (Iron & Steel Products). The Court had yet another reason to set aside the order of classification of poles under Item 68 because they had all along been classified under Item 26AA(iv) till Item 68 came to be incorporated in the tariff in the year 1975. The Court held that this circumstance alone could not be the ground for changing the classification of iron and steel poles.

21. Shri Sridharan had also referred to the ratio of the decision of the Tribunal in the case of Collector of Central Excise, Madras v. Sundaram Fasteners Ltd. [1985 (022) ELT 923] in which the Tribunal had discussed the nature and meaning of the test of common parlance in para 43 as under :-

“43. Much has been said about the test of common parlance or of the use of words in the sense in which people conversant with the subject matter of the statute would attribute to it. These unexceptionable principles are sometimes sought to be interpreted as if they meant that the tariff description should straightaway be applied to the article in question. The fallacy of such an approach would be obvious if we consider the case of an electric iron with reference to Item 33C ”domestic electric appliances". The test of “common parlance” does not require us to enquire whether the common name given by an ordinary person or by a dealer to an electric iron is “domestic electric appliance”. What the test of common parlance would require is that if an ordinary person or trader conversant with electrical articles is asked whether an electric iron is a “domestic electrical appliance”, he should be able to answer with conviction that it is .... Therefore, in applying the test of common parlance, the question is not whether the article under consideration is ordinarily referred to in the words of the tariff description, but rather whether according to common understanding it would be covered by the wording of the tariff description....."

22. In paragraph 17, we have, while distinguishing the judgment of the Supreme Court in Indian Metal & Ferro Alloys v. Collector of Central Excise (supra), seen how Rice Rubber Rolls do not answer the description of pipes, tubes and hoses in Heading 40.09. It has been the department’s case from the very beginning that the subject goods are not known in the common parlance as pipes, tubes and hoses; nor are they marketed by the respondents themselves by that name. It is clear that according to common understanding Rice Rubber Rolls would not be covered by the Tariff description “pipes, tubes and hoses”. The learned CDR had, in this connection also relied upon the decision of the Supreme Court in the case of Collector of Customs v. Bhor Industries Ltd. [1988 (035) ELT 346] in paragraph 5 of which the Apex Court had observed as under :-

“5. It is well-settled in these matters how a good is known in the trade and treated in the trade literature is relevant and significant and often decisive.”

23. While explaining the function of the Rubber Rolls, the learned CDR had also referred to me BI specification 8427 - 1977 in which there is mention of two types - the key type and the slip-on type. In the case of the former, the ISI specification indicated the number of keys and the key dimensions in each Roll. These characteristics also distinguish a Rice Rubber Roll from Rubber Tubings for general purposes and would, therefore take them out of the scope of Heading 40.09.

24. Shri Sridharan had cited the circular No. 2/90, dated 11-1-1990 issued by the Central Board of Excise & Customs in which, while considering the classification of rubber rolls, they have been referred to as “rubber pipes composed of unhardened vulcanised synthetic rubber”. From this he had contended that the authorities have themselves accepted the factual position that the rubber rolls are rubber pipes. While saying so Shri Sridharan has over looked the fact that the reference here is to the shape, which is what the learned CDR had submitted. We agree that this is the meaning when the text of the entire circular is studied which concludes by saying:

“4..... the Board accepts the decision arrived at by the Conference and accordingly it is viewed that the rubber rolls would appear to merit classification under Heading 40.16 as ”other articles of vulcanised rubber."

25. Shri Sridharan had contested that the fact that the Rice Rubber Rolls are cut to size and length and not being in running length cannot have the effect of taking them out of the category of pipes and tubes. He had referred to Explanatory Notes of the HSN for Heading 40.09 as well as to the decision of the Tribunal in the case Collector of Central Excise v. Aerolax Hose Pvt. Ltd. [1989 (039) ELT 681]. We observe that the Assistant Collector has taken this circumstance as only one of the considerations for deciding the classification under 4016.99, the main ground being different - viz. how Rice Rubber Rolls are known and marketed in the trade and what function they discharge. The learned Chief Departmental Representative has also placed a large number of judgments before us in support of the ‘common parlance test’. We do not, therefore, consider any substance in the argument of the learned counsel.

26. One other point which Shri Sridharan had taken up during his arguments is the mention by the Assistant Collector in his order that pipes and tubes are generally used for conveying air, gas or liquid and Rice Rubber Rolls do not perform such a function. We do not think that one can find fault with this general statement which is also strengthened by a specific sub-heading of such pipes and tubes in the tariff itself. Here, again the Assistant Collector has only mentioned a general fact but has not decided the classification of the subject goods on this criterion alone - the main argument being one of how they are known and marketed.

27. This also brings us to the question of availability of exemption to the subject goods under Notification No. 197/67-C.E., dated 29-8-1967 as amended. While setting aside the order of the Assistant Collector, Collector (Appeals) had allowed the benefit of exemption under the notification by accepting the claim that the subject goods were classifiable as “pipes and tubes” under sub-heading 4009.99. We have examined the matter at great length in the light of the submissions of both sides and the case law cited by them and have come to the conclusion in paragraph 17 of this order that neither by their process of manufacture, nor by their specific sizes or name, nor by their primary function are the Rice Rubber Rolls known or marketed as tubes, pipes and hoses, even though they may resemble the shape of the latter. We find that exemption under the notification is given to “piping and tubing of unhardened vulcanised rubber” falling under Chapter 40 as is specified in the Table appended to the notification. The claim of the teamed Counsel was that even if, for the purposes of classification, Rice Rubber Rolls are not held to be pipes and tubes, the wordings of-Serial No. 3 in the Table appended to the notification would entitle them to the exemption. For the purpose of examining this claim, it would be appropriate to examine these wordings :-

“3. Piping and tubing designed to be, or converted in the factory of its production into component parts of machinery articles (including typewriters), provided such component parts do not perform the function of conveying air, gas or liquid.”

28. Since the exemption under the notification is to piping and tubing, we would first have to see whether the subject goods fall in this category. After detailed examination of the matter, we have come to the conclusion that the subject goods are not pipes and tubes. One of the arguments of the learned CDR was that if the process of manufacture of the subject goods is carefully studied, it would appear that at no stage do pipes and tubes come into existence. She had laid emphasis on the wrapping of rubber sheets on the Malleable Steel Shells with the help of a wrapping machine and their subsequent vulcanisation resulting in coming into existence of Rubber Rolls. Thus, since the exemption is to piping and tubing which are designed to be, or converted in the factory of their production into component parts of machinery articles, we do not see how the subject goods would be entitled to the exemption, since, as we have seen, at no stage piping and tubing come into existence. The exemption would be available if piping and tubing were designed to be component parts of machinery articles or piping and tubing were converted in the factory of their production into component parts of machinery articles. Such being not the case, we consider that the subject goods do not qualify for exemption under Serial No. 3 of the Table appended to Notification No. 197/67 as claimed by the learned Counsel.

29. Shri Sridharan had placed reliance on the decision of the Bombay High Court in the case of Precision Rubber Industries v. Collector of Central Excise [1990 (049) ELT 170], in support of his stand that like aprons and cots. Rubber Rolls are also component parts of machinery and were entitled to the exemption. Paragraph 4 of this judgment which is relevant for our purposes is as under :-

“4. It is undisputed that the Petitioners manufactured in their factory at Thane, rubber pipes and tubes which are cut into smaller parts known as aprons and cots. The process consists manufacturing long rubber pipes/tubes and then cutting small pieces out of them only in such a manner that their cylindrical character is always retained. The aprons and cots come into existence upon the cutting of the larger tubes/pipes into small cylindrical pieces known as aprons/cots. The aprons and cots are components or textile machinery......”

30. It will appear from the above that the consideration on which the High Court held that the exemption was available to aprons and cots was that they were parts cut from piping and tubing. The Court had also found that before the introduction of Tariff Item 68, aprons and cots were considered as pipings and tubings classifiable under Item 16A. Unlike aprons and cots, the subject goods are not manufactured by cutting piping and tubing which alone are entitled to exemption under the notification. Thus, the ratio of the decision in Precision Rubber Industries case (supra) also does not help the respondents.

31. The learned Counsel had also raised the plea that the pipes and tubes is a generic description and rubber rolls are a specific description. The product is given a specific badge of rubber rolls for accurate identification in the market. The learned CDR had strongly contended that neither looking to the process of manufacture nor going by any other criteria, do pipes and tubes ever come into existence. The ISI specifications also indicate that .the subject goods are of two types - the key type and the slip-on type and have, for that purpose, to conform to certain requirements to fit into the machines. This is confirmed by the manufacturers’ literature. This being so, the plea that the subject goods fall in the generic description of pipes and tubes is misconceived.

32. The last contention which the learned Counsel dealt with during the arguments was that Section Note 1(a) of Section XVI also indicates the classification of the subject goods to be under Heading 40.16. We have examined the matter at great length quite independent of this argument and come to the conclusion that the subject goods are, even otherwise, classifiable under Heading 40.16. It is, therefore, not necessary for us, for the purpose of deciding the present appeals, to go into this argument at all.

33. During the hearing, the learned CDR had placed before us three samples of the goods and explained with reference, to the manufacturer’s leaflet how Rice Rubber Rolls were used in paddy dehusker. In particular, she had explained that in the key type rubber roll, there was a projection on the inner cylindrical surface which enabled the rubber roll to fit in on the drum. This was also explained with reference to the manufacturer’s leaflet. From the nature and appearance of the rubber rolls, it could be seen that they only resembled the shape of a pipe.

34. In dealing with these appeals, we have considered all the case law cited before us by both sides but we have referred only to those cases which we considered to be relevant for the purpose of deciding the appeals. The learned CDR had cited a number of judgments in support of her view that the classification should be decided by applying the common parlance test. Similarly, the learned Counsel had also pressed into service a number of decisions in support of his view. While we have referred to only those cases which were necessary, we have considered all of them in arriving at our decision. Besides, taking into account the argument of both sides, we have also carefully studied the resume of written submissions given by Shri Shridharan. Finally, would like to place on record our appreciation of the valuable assistance rendered by both sides in dealing with this complex question of classification.

35. To sum up, upon full consideration of all aspects of the matter, we are of the view that Rice Rubber Rolls manufactured by the appellants are classifiable under sub-heading 4016.99 and are not entitled to exemption under Notification 197/67-C.E., dated 29-8-1967. The order of Collector of Central Excise (Appeals), Chandigarh is set aside and both the appeals are allowed.

Equivalent 1993 (67) ELT 816 (Tribunal)