1992(07)LCX0046

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

Shri K.S. Venkataramani, Member (T) and Ms. Jyoti Balasundaram, Member (J)

PRAKASH PIPES & INDUSTRIES

Versus

COLLECTOR OF CUS.

Final Order No. 228 & 229/92-C, dated 29-7-1992 in Appeal Nos. C/2655/89-C & C/1822/90-C

Cases Quoted

CEAT TYRES (I) LTD. v. COLLECTOR - 1988(01)LCX0056 Eq 1988 (035) ELT 0635 (TRIBUNAL) [PARA 8]

COLLECTOR v. HICO PRODUCTS LTD. - 1988 (034) ELT 643  [PARA 8]

Advocated By: S/Shri L.P. Asthana, and N. C. Sogani, Consultants, for the Appellants.

S/Shri M. Jayaraman, SDR and Ram Prakash, for the Respondents.

[Order per : Jyoti Balasundaram, Member (J)j. - The classification of “Tetramethyl Tetraphenyl Trisiloxane - Silicone Oil” is the subject matter of these appeals - the appellants seek classification under Heading 3910.00 of the Customs Tariff as “Silicones in primary forms” while the Department has classified them under Heading 2931.00 as “other organo-inorganic compounds”. Both these appeals involve the same issue and therefore heard together and disposed of by a common order.

2. The appellants are engaged in the manufacture of black and white T.V. picture tubes for which they imported consignments of Tetramethyl Tetraphenyl Trisiloxane from M/s. Dow Corning Asia and claimed classification under Heading 3910 along with the benefit of concessional rate of duty under Notification 345/86-Cus., dated 16-6-1986. The goods were provisionally assessed under Heading 3910 but upon receipt of the test report from the chemical laboratory which stated that the “sample is silicone in the form of colourless liquid”. The Department sought to alter the classification and assessed the goods under Chapter 29 as chemically defined organic compounds. The lower appellate authority confirmed the order of the adjudicating authority and hence these appeals.

3. We have heard Shri L.P. Asthana, learned advocate and Shri M. Jayaraman and Shri Ram Prakash, learned SDR.

4. The bill of entry describes the goods as “Tetramethyl Tetraphenyl Trisiloxane - Silicone Oil". We have perused the technical literature of the manufacturer which describes the goods as diffusion pump fluid - we are informed that the silicone oil imported was used in diffusion pump to produce high vacuum in television and cathode ray tube. Diffusion pump fluid (DC 704) imported has a molecular weight of 484 & boiling point of 215⁰C(419⁰F) at 0.5 torr. In C/2655/89-C, the adjudicating authority proceeded to treat the goods as defined organosilicon compound having a mixture of Si- o - Si - o Si backbone and the silicone valences not taken up by the oxygen being saturated by 4 ethyl & 4 Phenyl radicals, and not polymeric silicones having no fixed molecular formula and molecular weight and the lower appellate authority also treated the goods as defined organic chemicals with a particular composition. Assessment under Heading 2931.00 was arrived at, applying Note 3 of Chapter 29 which provides for assessment of organo-silicon compounds of relatively low molecular weight in which silicon is directly combined with organic radicals including octamethyl cyclo-tetrasiloxane & excludes non-chemically defined products containing in the molecular weight more than one Silicon - Oxygen Silicon linkage and containing organic group connected to the silicon atoms by direct Silicon carbon bonds.

5. On the conclusion of the hearing on 24-1-1991, orders were reserved. However, when the files were taken up for preparation of the final order, it appeared that in the absence of certain information would not be possible to do justice to the matter. Hence, the hearing was reopened by Misc. Order No. 45 and 46/90-91/C, dated 30-1-1991. The Misc. Order is as follows :

“The point on which evidence is lacking is whether Tetramethyl Tetraphenyl Trisiloxane is a chemical of definite composition i.e. designated by a definite chemical formula. The report of the test conducted by the Chemical Examiner does not throw any light on this point.

Further in the explanatory notes appearing in the “Harmonized Commodity Description and Coding System” the following passage appears under Heading 29.31, on page 393 (“Other Organo-inorganic Compounds”):

“(3) Organo-Silicon compounds. These are compounds of relatively low molecular weight in which the silicon is directly combined with the organic radicals. They include ethyltrichlorosilane, triethylsilanol triphenylsilanol, hexamethyldisiloxane, octamethyl-trisiloxane, octamethylcyclotetrasiloxane, decamethylcyclo-pentasiloxane and dodecamethylclohexa-siloxane.

This heading does not include non-chemically defined products containing in the molecule more than one silicon oxygen-silicon linkage and containing organic groups connected to the silicon atoms by direct silicon carbon bonds. These are silicones of Heading 39.10. However, mixtures of separate chemically defined organo-silicon compounds are classified in Heading 38.23".

Similarly, if the same publication under Heading 39.10, in page 564 (“Silicones in Primary Forms”), the following passage occurs:-

“The silicones of this heading are non-chemically defined products containing in the molecule more than one silicon-oxygen-silicon linkage, and containing organic groups connected to the silicon atoms by direct silicon-carbon bonds”.

Evidence on the aforesaid points is essential for determination of the dispute in the present appeals. Both sides are, therefore, called upon to submit technical evidence on the above mentioned points which shall be supported by extracts from authoritative technical literature.

6. The matter was adjourned and came np for hearing on 16-8-1991 when the bench passed Misc. Order No. 188 & 189/91-C which is as follows:

“The copy of the queries raised by the appellants to the foreign manufacturer and the reply from M/s Dow Corning Asia is before us. The manufacturer’s reply states that (i) the product is not chemically defined product; (it) it is a product preparation based on Silicone; and (iii) it has double linkage. The report of the Chief Chemist which has been sent in response to letter addressed to him by the learned SDR states categorically that the goods under reference is a chemically well defined product. However, the report does not state the basis on which theChief Chemist has given these findings nor does it set out the definite chemical formula as it was directed by the earlier Misc. Order dated 29-1-1991. The basis for the conclusion that the product is a chemically well defined one and definite chemical formula if any of the product would be absolutely essential for the Bench to come to a conclusion on the classification of the goods. We, therefore, direct the Chief Chemist to clarify the conclusion arrived at in his report dated 6-5-1991 as to the basis on which he has given his findings and also the definite chemical formula of the product.

The Chief Chemist is also directed to offer his opinion on the information supplied by M/s. Dow Cornmg Asia in response to the appellants queries. A copy of the reply dated 15-5-1991 received from M/s. DOW Corning Asia is to be forwarded to the Chief Chemist for offering his opinion thereon. A copy of the manufacturer’s literature about silicon Diffusion Pomp Fluids is also to be forwarded to the Chief Chemist."

7. The Chief Chemist submitted his report on 25-2-1992 and the appellants sought further time to obtain certain clarifications thereon from the foreign suppliers. Ultimately, it was reported to the Bench by the learned Counsel for the appellants that the foreign suppliers had declined to clarify the matter further.

8. We have gone through the test report which describes the goods as “silicone in the form of colourless liquid". Explanatory notes to the H.S.N. (at page 552) describes “Silicones in primary forms” in Heading 39.10 as follows:

“39.10 - SILICONES IN PRIMARY FORMS.

The Silicones of this heading are non-chemically defined products containing in the molecule more than one silicon - oxygen-silicon linkage, and containing organic groups connected to the silicon atoms by direct silicon-carbon bonds.

They have a high stability and may be either liquid, semi-liquid or solid. The products include silicone oils, greases, resins and elastomers.

(1) Silicone oils and greases are used as lubricants remaining stable at high or low temperatures, as water-repellent impregnating products, as dielectric products, as foam inhibitors, as mould release agents, etc. Lubricating preparations consisting of mixtures containing silicone greases or oils fall in Heading 27.10 or 34.03.as the case may be”.

According to the learned Counsel, this description, fits the imported goods. Further, silicones are defined in Hawley’s Condensed Chemical Dictionary as “any of a large group of organosiloxane polymers based on a structure consisting of alternate silicon & oxygen atoms with various organic radicals attached to the silicon. Tetramethyl Tetraphenyl Trisiloxane nowhere finds mention in the above dictionary which mentions all chemically defined organic chemicals. The H.S.N. Explanatory Notes to Heading 29.31 defines organo silicon compounds as compounds of relatively low molecular weight in which the silicon is directly combined with the organic radical. Heading 29.31 does aot include non-chemically defined products containing in the molecule more than one silicon-oxygen-silicon linkage and containing organic groups connected to the silicon atoms by direct silicon-carbon bonds which are silicones of Heading 39.10.

He submits that the Tribunal has held, in the case of Ceat Tyres (I) Ltd. v. Collector of Customs, Bombay - 1988 (035) ELT 635, that Chapter 39 covers synthetic polymers i.e. goods produced by chemical synthesis of the kind called condensation, poly-condensation, poly-addition, polymerisation and co-polymerisation and that silicone oil is silicone classifiable under Chapter 39. In the case; of Collector of Customs, Bombay v. Hico Products Limited - 1988 (034) ELT 643, it has been held that a silicone product must fall under the head Silicone and there is nothing in the law that a low-polymerisation product is not classifiable under Chapter 39 of the Customs Tariff Act. He contends that there is a basic flaw in the findings of the lower authorities, namely, in treating the goods as chemically defined organic compounds when they are non-chemically defined products. Once it is held that the goods are not chemically defined organic compounds, classification under Chapter 29 is automatically ruled out.

9. However, in this case the Chief Chemist coofirms that the imported goods are chemically defined organic compounds. The test report of 6-5-1991 of the Chief Chemist is to the effect that the goods under reference is chemically well defined product. The report is as follows:

“From

The Chief Chemist, Central Revenues.

To

Shri M. Jayaraman,

Sr. Departmental Representative,

Office of the Chief Departmental Representative,

Customs, Excise Gold (Control) Appellate Tribunal,

R. K. Puram,

New Delhi.

Sir,

Subject: A. No. C/2655/89-C and C-1822/89-C filed by M/s. Prakash Pipes & Industries Ltd., New Delhi.

…… ……

Please refer to your letter F. No. C/2655/89-C/1151 dated 26-3-1991.

The name of silicone denotes a synthetic polynar (Rm Sio (4-m)2)m wherein - 1-3 and m - 2). It contains a repeating silicon oxygen, backgone and has organic groups attached to a significant proportion of the silicon atoms by silicon-carbon bonds. In commercial silicones ‘X’ groups are usuany methyl, phenyl, vinyl, etc. Silicones include fluids, resins and elastomers.

Silicones of Chapter 39 are not chemically defined products. They contain more than one milicon-oxygen-silicon linkage in the molecule and organic groups are attached to the silicon atoms by direct silicon bonds. Whereas chemically well defined products like hexamethyl disiloxanes, oxtamethyl trisiloxanes, becomethyl eylopenta siloxanes, are covered under Heading 29.31 as other organo inorganic Compounds.

The goods .under reference claimed as ‘Tetramethyl Tetraphenyl Trisuoxane” with a molecular weight 484, is a chemically well defined product and hence classifiable under Heading 29.31 of the I.C.T.

10. The Chief Chemist has further clarified the matter by his report of 25-2-1992. Relevant extracts of which are set out below:

“The conclusion that the goods under reference Tetramethyl Tetraphenyl Trisiloxane is a separate chemically defined organic compound is based on the facts given in the authentic technical books available here.

1, 2, 2, 3 Tetramethyl 1, 1, 3, 3 Tetraphenyl Trisiloxane is listed as an organic compound in Lange’s Hand Book of Chemistry by John A. Deen (copy enclosed).

The structural formula and other constants is given for the product as under:

Ch3

1

(C6 H5)2 Si – O - Si - O - Si (C6 H5)2

111

CH3 CH3 Ch3

Since the product is an organic compound having fixed formula weight, density, Refractive Index, Boiling point etc. it merits consideration as a separate chemically defined organic compound.

11. In the light of the above reports of the Chief Chemist, we have no hesitation in holding that the goods are chemically defined organic compound classifiable under Heading 2931.00 of the Customs Tariff Act, 1985.

12. In the result we uphold the impugned order and reject both appeals.

Equivalent 1992 (62) ELT 580 (Tribunal)