1996(05)LCX0028

IN THE CEGAT, COURT NO. IV, NEW DELHI

S/Shri S.L. Peeran, Member (J) and J.H. Joglekar, Member (T)

BALIAPATAM TILE WORKS LTD.

Versus

COLLECTOR OF C. EX., COCHIN

Order No. 378/96-D, dated 31-5-1996 in Appeal No. E/3155/87-D

CASE CITED

Ballarpur Industries Ltd. v. Assistant Collector — 1995(01)LCX0139 Eq 1995 (076) ELT 0499 (S.C.)                   [Para 4]

Advocated By : None, for the Appellant.

 Shri J.M. Sharma, JDR, for the Respondents.

[Order per : S.L. Peeran, Member (J)]. - This appeal arises from order dated 31-8-1987 passed by the Collector (Appeals), Madras. This issue before the Collector was correct classification of the goods.

“Facing tiles/Flooring tiles and split flooring tiles of clay”.

The Assistant Collector had classified the goods under Chapter sub-heading 6903.90. The Revenue filed a review application before the Collector. The Learned Collector has held that :

“On a careful reading of Chapter Heading 6905, it will be seen that only unglazed materials or hearth of wall tiles are included under this heading. It is not in disputed by the respondents that these goods are used on the exterior walls of buildings. As per the pamphlet submitted by them the method of laying is also mentioned and it is admitted that these are used on the exterior walls of buildings. Therefore, these are unglazed wall tiles. The specific description of unglazed wall tiles being covered under 6905, the correct classification has to be under 69.05 as applied for the application. As against that the claim of the respondents that the same are architectural ornaments and other ceramic constructional goods is a vague description and it does not cover unglazed wall tiles being specifically mentioned under T.I. 6905. There is no claim that these tiles are roofing tiles. Therefore, the order of the Assistant Collector is not maintainable and the same is set aside and the application allowed for the reasons stated by me above.”

2.  The Assistant Collector in his order on these products has held as follows :-

“Facing tiles, Flooring tiles, Split Flooring Tiles :- The items with the above name manufactured at M/s. Baliapatam Tile Works, are Terracotta products. They are unglazed, if they are seeked in water for a longer period they will disintegrate and melt or by absorption of water become soft and will broke late pieces. When scratched, it will retain the scratch mark. They are neither scratch proof nor moisture proof. (During the personal hearing they had shown as one glazed and one unglazed ceramic tiles of SPARTAK manufactured at Madras). The assessee sought to classify them 69.03 as other ceramic constructional goods. The department intended to classify this under Tariff 69.05 attracting 30% duty. On examination of this product and after seeking the SPARTEX ceramic Tiles it is very difficult to compare the product of clay as Terracotta manufactured at the Factory of the assessee with that of ceramic flooring manufactured at Madras. Inclusion of Mosaic cubes in 69.05 in indicative of the type of Flooring/Wall tiles that can be classified under 69.05. Accordingly ceramic tiles of the type produced at Madras can be correctly under 69.05 but it will not be proper classification of clay facing tiles, Clay flooring tiles and clay split tiles under 69.05 as they cannot be akin to the products included in 69.05 i.e. Mosaic cubes, hearth or wall tiles of or flag and paving, unless they are capable of withstanding high temperature they may not be usable in the hearth or wall of fire places. No doubt, the products of the assessee are used on the exterior walls of the building on R.C. roofs and coffee curing yards. But on seeing the other ceramic products and their strength and quality, I am inclined to classify the clay flooring tiles, Clay Facing tiles and clay split tiles under the Chapter Heading 6903.90 as other ceramic constructional goods attracting 12% duty.

3. The appellant has desired the case to be decided on merits. In the appeal, they have reiterated their submissions as made before the Assistant Collector and before the Collector (Appeals). They contended that the items in question are Terracotta products manufactured from common Red Clay and are not ceramic products, which are specifically made from ceramic clay to withstand 900^oC and which retains the shape of the product moulded out of it in Raw stage. It is stated that unlike their common Red Clay (Terracotta) product, the ceramic tiles are comparatively very strong, scratch free and hence costly too and that they are manufactured and sold as “Johnson Tiles”, “Spartex Tiles”, by those companies. It is also stated that such ceramic tiles in erstwhile Tariff had been classified under Item No. 23B while their product had been classified under TI 68 and hence there is no justification to reclassify the goods on change of Tariff. It is further pleaded that their products are all flooring tiles manufactured for paving on floors they are not wall tiles. The Facing Tiles are manufactured for use in Civil Engg. Works as constructional goods for fixing on the exterior of selected portions of building construction for architectural/ornamental effect. Some may use them occasionally for fixing on the exterior of some portion of walls also for architectural/ornamental effect, but it does not mean that they are actually wall tiles. As actual wall tiles such as `Johnsons Tiles, Spartex Tiles’. Before the Collector (Appeals) in the written adjudication. They had also stated that the genuine term “Ceramic” means “earthen” or materials and articles made from naturally occurring earths. This item would therefore, include all products made of inorganic material which are first shaped and then permanently hardened by heat. It is stated that technically “Ceramic products” are those made out of special ceramic clay that withstands temperature exceeding 900^oC. They state that “Facing tiles, flooring tiles and split flooring tiles” are all manufactured out of ordinary red clay and cannot be classified as refractory materials, pottery or glazed ceramic products.

4. The Learned DR submitted that the Tariff Heading 6905 is most appropriate, which is akin to HSN Heading 6907. He also referred to Board Circular and Tariff Advice dated 17-10-1988 [1989 (039) ELT T5] to support the classification adopted by the Collector (Appeals). As regards reopening the classification the Learned DR relied on the Hon’ble Supreme Court’s ruling rendered in the case of as reported in 1995 (076) ELT 499.

5. We have carefully perused the submissions of the appellants made in the appeal memo and those of the Learned DR. The plea that reclassification cannot be made is untenable, as on the introduction of CET, 85, the goods were required to be reclassified in terms of new classification being based on section note, chapter note and also aligned to international codified system. It is now well settled that classification can also be reopened on fresh grounds. Note 2 of Chapter 69 states that :

“This Chapter applies only to ceramic products which have been fired after shaping.”

The admitted fact is that the goods in question are made from ceramic material and made by firing after shaping hence Chapter 69 applies to the goods. The contention of the appellant is that the goods fit into the category “other ceramic constructional goods” in the residuary category of Heading 6903.90, which is also extracted. It is the contention of the Revenue that the description under 69.05 is more specific and on reading HSN 6907, which is akin to 6905, the classification under this heading is required to be accepted, as held by the Collector (Appeals). The assessee states that those ceramic tiles which withstand temperature of 900^oC alone can fall under this heading. It is seen that those items which stand such temperatures are all glazed ceramic, which fall under Heading 6906. Therefore, this contention of the assessee is required to be rejected. Heading 6905 covers goods which are unglazed ceramic flags and pavings. Admittedly, the goods are used for pavings and floorings, then to the category of `other ceramic constructional goods’ under Heading 6903. Further goods under this heading should be such which are of the same class as `Roofing tiles, chimney pots, cowls, chimney liners, architectural ornaments, which are described in Heading 6903. The goods in question do not come in that category as described in Heading 6903, hence Heading 6903 gets excluded. The goods in question are admittedly unglazed made out of ceramic material, though only of Red Clay. In their memorandum of objections filed before the Collector (Appeals), they have stated in para 8 & 9 :

“8. In view of this distinction ceramic materials are divided into four main group, viz;

(i) structural clay products made chiefly out of ordinary red clay and used in building trades and civil engineering works;

(ii) refractory materials used in the construction of kilns because of their great durability at high temperature;

(iii) pottery which includes many varieties including beautifully decorated porcelain; and

(iv) glazes which produce a glossy surface on other ceramic products.

9. Facing tiles, Flooring tiles and Split flooring tiles are all manufactured out of ordinary red clay and cannot therefore be classified as refractory materials, pottery or glazed products. Whereas ceramic products as understood in the trade are hard and scratch proof, having been fired at temperatures exceeding 900^oC, such properties are not present in these terracotta products. A visual examination would bring out the distinction between the terracotta and other products."

6. In view of the fact that their product is also made from ceramic product, their inclusion in Chapter 69 & Heading 6903 is appropriate, as the same is unglazed and used for paving. The HSN note at Page 919 and 920 reads as follows :-

“69.07 - UNGLAZED CERAMIC FLAGS AND PAVING, HEARTH OR WALL TILES; UNGLAZED CERAMIC MOSAIC CUBES AND THE LIKE, WHETHER OR NOT ON A BACKING.

6907.10 - Tiles, cubes and similar articles, whether or not rectangular, the largest surface area of which is capable of being enclosed in a square the side of which is less than 7 cm

6907.90 - Other

This heading covers ceramic flags and tiles, including quarry tiles, commonly used for paving or for facing walls, hearths, etc., provided they are unglazed (see Explanatory Note to Heading 69.08 regarding glazed goods).

Flags and paving, hearth or wall tiles are thinner in relation to their surface dimensions than are building bricks. Whereas bricks play an essential part in constructional work, forming the very framework of the building, flags and tiles are more especially intended for fixing by cement, adhesive or by other means to the surface of existing walls, etc. They also differ from roofing tiles in that they are usually flat and do not need to be pierced or provided with nibs or otherwise shaped for interlocking and that they are designed to be placed side by side without overlaping. Flags are larger than tiles and are usually rectangular; tiles may be of other geometric shapes (hexagonal, octagonal etc.). Tiles are mainly used for facing walls, mantelpieces, hearths, floors and paths; flags are more especially used for paving or flooring, or as hearth slabs. Both categories may be of common pottery or earthenware, but types which have to withstand heavy wear are often vitrified, for example, tiles of stoneware, or porcelain (china) or of fired steatite (e.g. tiles for lining grinding mills, etc.).

Certain ceramic tiles are used solely for paving; unlike bricks, they are usually cubic or in the form of truncated pyramids. In practice, they are normally of stoneware or, exceptionally, of porcelain or china (e.g. flags for pedestrian crossings).

The classification of goods in this heading is therefore determined by their shape and size, rather than by their composition; thus bricks suitable for use both in building and for paving (e.g. vitrified bricks) are excluded (Heading 69.04).

Goods of this heading may be coloured in the mass, marbled, ribbed, channelled, fluted, etc., but they must not be glazed.

Subject to the above conditions, the heading also includes :

(1) Bordering, capping, skirting, frieze, angle, corner or other fitting tile pieces employed for finishing off the facing, paving, etc., work.

(2) Double tiles intended for splitting before use.

(3) Mosaic cubes, whether or not on a paper or other backing.

On the other hand, in addition to glazed articles the heading excludes :

(a) Tiles specially adapted as table mats, etc. (Heading 69.11 or 69.12).

(b) Ornaments and the like of Heading 69.13.

(c) Ceramic tiles specially adapted for stoves (Heading 69.14).

On a careful consideration of all the pleas and on examination of the Explanatory Note under HSN 6907, which is akin to Heading 69.05, the classification adopted by ld. Collector in respect of goods in question is correct and requires to be confirmed.

7. The ld. DR relied on Tariff Advice cited in 1989 (039) ELT T5 it pertains to Biscuit Tiles, which emerge as an intermediate product and held to be non exigible. The said Tariff advice is totally irrelevant. Perhaps, ld. DR has cited the same by inadvertent mistake.

There is no merit in the appeal and hence the same is dismissed.

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Equivalent 1996 (88) ELT 127 (Tribunal)