1993(04)LCX0072

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

S/Shri Harish Chander, President, K.S. Venkataramani, Member (T) and

S.L. Peeran, Member (J)

RAPICUT CARBIDE LTD.

Versus

COLLECTOR OF CUSTOMS, BOMBAY

Final Order No. 99/93-C, dated 6-4-1993 in Appeal No. C/3861/88-C

Cases Quoted

MMTC v. UOI — 1972(08)LCX0003 Eq 1983 (013) ELT 1542 (SC)                                                                           [Paras 1, 9, 19, 27]

Straw Products Ltd. v. UOI — 1990 (047) ELT 527                                                                                 [Para 4]

Bharat Forge & Press Industries (P) Ltd. v. Collector — 1990(01)LCX0072 Eq 1990 (045) ELT 0525 (SC)                       [Para 19]

Indian Metals & Ferro Alloys Ltd. v. Collector — 1990(11)LCX0014 Eq 1991 (051) ELT 0165 (SC)                                  [Para 19]

Colgate Palmolive (India) Ltd. — 1980(01)LCX0012 Eq 1980 (006) ELT 0268 (Bom.)                                                              [Para 19]

Collector v. Calcutta Steel Industries — 1988(10)LCX0027 Eq 1989 (039) ELT 0175 (SC)                                                    [Para 19]

Suja International v. Collector — 1987(09)LCX0057 Eq 1989 (044) ELT 0387 (Tribunal)                                                    [Para 19]

Garware Nylons Ltd. v. UOI — 1980(04)LCX0012 Eq 1980 (006) ELT 0249 (Bom.)                                                                 [Para 19]

Dunlop India Ltd. v. UOI — 1975(10)LCX0016 Eq 1983 (013) ELT 1566 (SC)                                                                       [Para 20]

Collector v. Rohit Pulp & Paper Mills — 1985(02)LCX0057 Eq 1985 (021) ELT 0571 (Tribunal)                                      [Para 20]

Collector v. Metrowood Engineering Works — 1989(02)LCX0063 Eq 1989 (043) ELT 0660 (Tribunal)                          [Para 20]

Hindustan Thermo Prints v. Collector — 1989 (043) ELT 121                                                          [Para 22]

Keltron Power Devices v. Collector — 1987 (028) ELT 93                                                                  [Para 27]

Nivedita Chemical (P) Ltd. v. Collector — 1985 (020) ELT 382                                                        [Para 27]

Saurashtra Chemicals v. Collector — 1986 (023) ELT 283                                                                 [Para 27]

Advocated By : S/Shri R.P. Shah, H.C. Daruwala, Rohan Shah, A. Shirazi, Advocates, for the Appellants.

 Shri S. Chakraborty, JDR and Smt. Ananya Ray, SDR, for the Respondent.

[Order per : K.S. Venkataramani, Member (T)]. - This appeal is directed against the order issued on 20-6-1988 passed by the Collector of Customs (Appeals), Bombay by which he had upheld the order dated 5-1-1987 passed by the Assistant Collector of Customs, Appg. Department, Group D, New Customs House, Bombay. The appellants, herein, imported 4,000 kgs. of Scheelite Concentrates declared as Australian King Island Scheelite Tungston Ore and filed the Bill of Entry on 3-9-1986 for its clearance claiming classification under the Customs Tariff Act Heading 2611.00. This heading covers “tungston ore and concentrates”. The goods were declared to have 78.6% WO 3 content. They also produced a weight and analysis certificate issued by M/s. King Island Scheelite dated 20-4-1986. Eighty per cent of the goods was released pending test result. The sample, therefrom, was drawn and tested by the Customs House laboratory which gave the opinion that the material was inorganic chemical calcium Tungstrate in the form of white powder in their test report dated 6-10-1986 given by the Dy. Chief Chemist of the Customs House Laboratory, Bombay which did not support the declaration of the goods in the Bill of Entry as `Tungston Ore’. The appellants contested this and said in their letter dated 4-12-1986 that the concentrated ore imported is the starting point for further digesting treatment with Hydrocloric Acid to convert this Ore through Ball milling cycle. Therefore, they said it is not calcium tungstate. They also produced a certificate from the National Chemical Laboratory, Pune stating that on the basis of X-ray defraction report calcium tungstate in natural scheelite and kings island scheelite is almost similar in its crystallographic form and there is no change in its structure. They also relied upon the Supreme Court decision in the case of MMTC v. UOI - 1972(08)LCX0003 Eq 1983 (013) ELT 1542 (SC) = AIR 1972 SC 2551 which laid down that the important test is that the chemical structure of the Ore which should remain the same and held that whether the Ore imported is in a powder form or granule form is wholly immaterial. They, therefore, questioned the Customs House opinion that the goods should be classified under Chapter 28 of the Customs Tariff Act which covers inorganic chemicals organic or inorganic compounds of precious metals, of rare-earth metals, of radioactive elements or of isotopes under Section VI CTA which covers products of the chemical or allied industries. The Assistant Collector considered the contentions put-forth in order in assessment dated 5-1-1987 and pointed out that the analysis certificate produced by the importers describes the goods as artificial scheelite whereas the Customs House Laboratory has reported the goods to be calcium tungstate. The Assistant Collector concluded that it is evident from the supplier’s certificate that the goods imported is a synthetic product and as such cannot be considered as ores covered by Chapter 26 and further held that even if the crystallographic structure of Spanish natural Scheelite and king island scheelite is similar, there is enough evidence to indicate that the imported goods are synthetic product and not the natural ore and cannot be treated to be ore as covered by Chapter Note 2 of Chapter 26. This Chapter Note 2 reads as under :-

“For the purposes of Heading Nos. 26.01 to 26.17, the term `ores’ means minerals of mineralogical species actually used in the metallurgical industry for the extraction of mercury, of the metals of Heading No. 28.44 or the metals of Section XIV, XV, even if they are intended for non-metallurgical purposes. Heading Nos. 26.01 to 26.17 do not, however, include minerals which have been submitted to processes not normal to the metallurgical industry.”

The Assistant Collector, therefore, ordered that the goods imported be classified under Chapter 28 as calcium tungstate and demanded differential duty on the consignment cleared. An appeal was filed against the Assistant Collector’s order. The Collector of Customs (Appeals), in the impugned order, gave a finding that the appeal before him was delayed by 9 days and that there was no request for condonation. He, further, found on merits that the product imported being artificial scheelite, which has been found on test to be inorganic chemical calcium tungstrate in the form of white powder, the order of the Assistant Collector holding that the goods fall under Chapter 28 and not under Chapter 26 CTA, was upheld on merits and the Collector (Appeals) also concluded that the appeal was time-barred.

3. Shri R.P. Shah, the Ld. Counsel, alongwith Shri H.C. Daruwala, Ld. Counsel appearing for the appellants contended that the delay in filing their appeal was caused by the incorrect direction in the preamble to the Assistant Collector’s order regarding the address of the Appellate authority and that the delay was not deliberate and should be condoned. On merits, the Ld. Counsel submitted that the goods imported is scheelite concentrate and is fully covered by the tariff description under Heading 2611.00 which covers Tungston ores and concentrates. Even going by the Deputy Chief Chemist’s report says that the goods are inorganic chemicals, yet the specific Heading 2611.00, which covers the product, should prevail. Reference was also made to the Webster’s 3rd International Dictionary where the meaning of scheelite is given as a native calcium tungstate CaWO₄ and as a commercial source of tungsten compound. Similarly, in the New Webster International Dictionary it is said to mean an important ore of tungsten. Ld. Counsel also made a reference to the Explanatory Notes to the HSN under Heading 26.11 covering tungsten ores and concentrates which includes scheelite and calcium tungstate. The Ld. Counsel, further, argued that the fact that the goods were found to be in powder form will make no difference for which he relied upon the decision of the Supreme Court in MMTC case (supra). Referring to the Chapter Note 2 of Chapter 26, the Ld. Counsel urged that according to this Chapter Note the Headings 26.01 to 26.17 will not include minerals which have been submitted to processes not normal to the metallurgical industry, whereas in the present case the goods imported have been subjected only to the normal processes of making the ore usable in metallurgical industry by crushing, grinding, flotation, etc. and in this context he referred to the Affidavit of one Shri T.R.S. Krishnan who had given the affidavit after seeing the sample of imported scheelite, and after perusing the certificates given by the Head of the Physical Chemistry Division of the National Chemical Laboratory, Pune and the Head of the Physics Department, Pune University, had opined that the Australian Kings Island Scheelite ore is only ore from which associated impurities are removed by usual ore processing methods and that it is akin to Spanish Natural Scheelite Ore, thereby showing that the King Island Scheelite Ore is similar to the natural one and not a chemically prepared calcium tungstate. He also referred to the certificate of the Head of the Department of Physics, University of Pune, who had carried out X-ray diffraction analysis of three samples, viz. (i) Precipiated Calcium Tungstate (ii) Natural Scheelite, and (iii) Australine Synthetic Scheelite. He had opined that crystallographic structure of sample No. 1 may be different from the structure of samples No. 2 and 3, which have identical structure as mentioned above. He also referred to the literature from the supplier titled Operations at King Island Scheelite in which it has been stated that the Tungsten is found in nature as a mineral, and there are numerous tungsten minerals. The Ld. Counsel, further, contended that the classification adopted by the Department is also not in accordance with the Rules of interpretation for interpreting the Customs Tariff. Rule 3(a) lays down clearly that the heading, which is specific to the goods, should be adopted, and in this case Heading 2611.00 being specific, ought to have been adopted, and there is no justification for excluding the goods from that Chapter. He also referred to the letter of suppliers dated 14-5-1987 addressed to the appellants saying, inter alia, that the scheelite ore supplied by them is a mineral ore and not produced from chemicals, and that only the molybdenum is removed by chemical process normal to the industry and hence it is called Artificial/Synthetic Scheelite ore in the trade.

4. Shri S. Chakraborty, the ld. JDR appearing for the Department, pointed out that the test report of the Customs House Laboratory, in this case, is very clear stating that the goods imported is inorganic chemical calcium tungstate in the form of white powder. He, further, pointed out that under the Customs Tariff, there are distinct product groups under Sections V & VI where Section V relates to mineral products including ores, slag and ash and Section VI relates to the products of the Chemical or Allied Industries. According to the Test Report, the goods is stated to be inorganic chemical CaWO₄ which means it is a separate chemically defined compound. Chapter 28 of CTA in Chapter Note 1(a) covers separate chemical elements and separate chemically defined compounds, whether or not containing impurities. The reliance placed on the Supreme Court decision in the case of MMTC (supra) by the appellants will be of no avail, according to the Ld. DR, because that decision was given in the context of the Indian Customs Tariff and not Customs Tariff Act, 1975, with which we are presently concerned, which has a self-contained section and chapter notes and Rules of Interpretation and classification under it is to be determined within the parameters of these notes and the tariff heading. For the same reason, the Ld. DR pointed out that there is no need to go into the dictionary meaning of the term `Ore’ or `Mineral’ so long as the scope of the tariff entry can be decided within the coverage of the section and chapter notes and the tariff heading, itself. The opinion given by the University of Pune regarding the crystallographic structure is apparently subsequent to clearance of the goods and does not, therefore, have much evidentiary value. The goods had been cleared in October, 1983. In reply, the Ld. Counsel pointed out that even if the product is held to be calcium tungstate, it is nothing but scheelite as indicated by the supplier’s clarification in their letter dated 14-5-1987, and even going by the Chapter Note 2 of Chapter 26, the goods will still fall only under that chapter. Therefore, there is no cause for classifying the goods under Chapter 28 CTA according to the appellants. The Ld. Counsel pointed out that the Bombay High Court decision in the case of Straw Products Ltd. v. UOI reported in 1990 (047) ELT 527 also supported the appellants wherein the High Court held that Manganese Ore containing 82.84% manganese dioxide and needing subjection to several processes prior to use in dry cell batteries is classifiable as naturally occurring ore and that classification by the Department on the basis of material being in powder form is erroneous, and the Court held the goods as classifiable under Item 26 of the Indian Tariff Act, 1934 and not under Item 28 thereof. Court held that the material being in powder form will not be a ground for considering it to be not ore in natural form. The Ld. Counsel urged that the fact Tariff has changed will make no difference because the test laid down for considering the material as ore by the Court is still valid.

5. I have carefully considered the submissions made by the Ld. Counsel and the Ld. D.R.

6. The goods, imported, have been described in the Bill of Entry as Scheelite Concentrate (Australian King Island Scheelite Tungsten Ore). The goods are now being sought to be classified by the Department under Chapter 28 whereas the appellants’ claim is that it should be classified under Heading 2611.00 as tungsten ores and concentrates.

7. In the first instance, we find that though the Collector has held the appeal to be time-barred, he has also gone into the merits of the case and given findings. We find, considering the explanation given for the delay, which is also only of 9 days, it is condonable, because the address of the Appellate Authority as given in the preamble was apparently not the correct one, and the admitted fact is that the appellants have filed the appeal before the Collector (Appeals) in time at the address indicated in the preamble to the Assistant Collector’s order in assessment. The question is whether the goods, imported, will fall under Heading 2611.00 as Tungsten Ores and Concentrates. The packing weight and analysis Certificate dated 15-8-1986 for the goods from the suppliers describes the product as Artificial Scheelite having WO3 content of 78.9%. The process of manufacture of the products manufactured by the suppliers is described in detail in their own literature available on record titled `Operations at King Island Scheelite’ (Page 10). It will be useful to reproduce the portion of this literature as under :-

TUNGSTEN

“The word ”tungsten" comes from the Swedish language and means heavy stone. Tungsten is actually a metal and is not found in nature as such.

It has a high specific gravity of 19.2 and a high melting point of about 3000^oC. It is a comparatively rare element, only 0.005% is contained in the earth’s crust compared with 8.13% aluminium and 46.59% of silica.

Tungsten is found in nature as a mineral, and there are numerous tungsten minerals. The main ones are wolframite (or wolfram) and scheelite. Wolfram is an iron manganese tungstate while scheelite is a calcium tungstate.

Scheelite ore is generally a dull metallic grey to the naked eye. It is best seen under ultra violet light where it fluoresces blue (pure scheelite) or yellow (impure scheelite containing molybdenum).

About 60% of the tungsten used in the world goes to make tungsten carbide, a hard wear resistant material used for lathe tools, saw blades, percussion bits and such like. The other major usage is for various types of tool and alloy steels. An interesting use has been electric lamp filaments because of the high melting point of tungsten.

The price of tungsten has always been volatile and fluctuates greatly. From the mine, tungsten is sold as a concentrate - either wolframite or scheelite. The tungsten in the concentrates for sales purposes is assayed as tungstic oxide WO_3. For weight the concentrates are measured in M.T.O.’s, which is 1/100 of a metric tonne. The grade of concentrate has to be higher than 65% WO3.

METALLURGICAL OPERATIONS

General Milling Operations

The existing concentrator commenced operating in 1944. Much of the building and some equipment is still in use.

Many modifications have been made to increase the treatment rate and improve recovery. Recently completed programmes have brought the treatment rate to over 400000 tonnes per annum at 0.80% WO₃ average head grade material. A new complex has been completed to convert the product from the flotation section to a molybdenum-free high purity calcium tungstate or “artificial scheelite”

(refer flow diagram page 27).

The plant operates on a continuous three shift basis, producing a coarse plus 74 micron gravity concentrate of 72% WO₃ grade, and a fine chemically precipitated artificial scheelite of approximately 77% WO3 to 78% WO3 grade_.

Crushing

Ore is delivered from the two underground mines in 35 tonne trucks and crushed in primary jaw and two stage gyratory crushers, the final stage being in closed circuit with two five-deck vibrating screens. Screen undersize (nominally minus 10mm) is delivered to the fine ore storage bins.

Grinding

Fine ore is drawn from one of two storage bins over a load cell weightometer and fed to two wet ball mills. Primary mills operate in closed circuit with five-deck vibrating screens, screen undersize at minus 840 micron passing to the concentrating section where it is cycloned into plus and minus 74 micron fractions for treatment in gravity and flotation sections respectively.

Gravity Concentration

Plus 75 micron cyclone underflow is sorted into six size fractions in five spigot hydrosizers. Spigot products are fed to either spirals or tables for recovery of scheelite values, rougher concentrates being re-tabled for upgrading. Hydrosizer overflow is thickened by cycloning, solids passing to the flotation section feed while cyclone overflow is used as circuit water.

Gravity section middling and coarse tailing fractions are retreated in a separate circuit where they are cyclone dewatered and reground; regrind mill discharge is classified by two stage cycloning to remove minus 74 micron material which joins the flotation feed, plus 74 micron material passing on to spirals. Spiral concentrate is upgraded on tables, spiral tails being discarded as final gravity tailing.

Flotation

All pulp streams containing minus 74 micron material are fed to two thickners of 18.5 and 24.5 m diameter. Thickener underflows, at 30 to 35 per cent solids, are pumped to flotation feed conditioners where reagents are added to increase pulp pH, disperse silicious gangue, depress calcite, collect scheelite, and form a stable froth. The conditioned pulp is then passed to rougher-scavenger flotation cells, the forth concentrate products being directed to cleaner cells when necessary to give a low grade (20 to 25% WO₃) concentrate suitable for feed to the artificial scheelite plant. Scavenger cell tailing is a final reject material, and joins the gravity section tailing for disposal."

8. There is also a chart of the products and process which shows the mined ore after crushing is subjected to grinding and thereafter there is a process of flotation and tabling. After the tabling process, what is described as natural scheelite, is obtained and is ready for marketing. From tabling process, further processes of digestion and filtering are undertaken and thereafter by the chemical process of precipitation marketable synthetic scheelite is produced. From the reading of the literature of the suppliers as above, it is clear that the tungsten concentrate for sale purposes has to be higher than 65% WO₃ i.e. Tungstic Oxide. The suppliers’ literature further indicates that there is a plant for converting the product from the flotation section to a molybdenum-free high purity calcium tungstate or `artificial scheelite’ of approximately 77% WO3 to 78% WO3 grade. Apart from this, the literature indicates that the plant produces a coarse plus 74 micron gravity concentrate of 72% WO3 grade and a fine chemically precipitated artificial scheelite of approximately 77% WO3 to 78% WO3 grade. This, itself, indicates that the suppliers produce and market two products. One which the suppliers describe as concentrate of 72% WO3 and another which they call artificial scheelite 77% WO3 to 78% WO3 grade. That these are two distinct products, is also evident from the suppliers’ letter dated 14-5-1987 and their telex dated Jan. 7, 1987. In the telex, they have described their product as natural scheelite or synthetic scheelite. In the letter dated 14-5-1987, they have referred to two forms of their products, namely, normal gravity, high molybdenum concentrate and normal technically molybdenum-free concentrate in which by other treatment virtually all of the molybdenum content has been removed to make it acceptable to more discriminating consumers such as the Tungsten Carbide Industry (emphasis supplied).

9. From the above, it is evident that the scheelite concentrate of 72% WO₃ grade is itself marketable and is capable of being utilised by the user industries. The molybdenum-free high purity calcium tungstate, a fine chemically precipitated artificial scheelite of 77% WO3 to 78% WO3 grade, is a further refinement, and according to the suppliers themselves, meant for more discriminating consumers. It is, further, seen from the literature titled `Operations at King Island Scheelite’ that the calcium tungstate Artificial Scheelite is obtained by a process of chemical precipitation. This is also supported by the diagram of the products and process supplied by the appellants wherein natural scheelite is prepared and ready for marketing after the tabling process whereas synthetic scheelite undergoes further processes of digestion, filtering and is obtained by chemical precipitation. Further, according to the literature `Opertions at King Island Scheelite’, during the processing streams containing minus 74 micron material are fed to two thickeners, are pumped to flotation feed conditioners where reagents are added to increase pulp pH, disperse silicious gangue, depress calcite, collect scheelite and the conditioned pulp is then passed to flotation cells to obtain a low grade concentrate suitable for feed to the artificial scheelite plant. All this is in expansion of the what is stated in the same literature under heading `General Milling Operations’ that the supplier has a complex to convert the product from flotation section to a molybdenum- free high purity calcium tungstate or `artificial scheelite’. It is in this context, therefore, with reference to the goods imported, which is described as artificial scheelite by the suppliers, that we have to apply the Section Note 2 to Chapter 26 which says that the Headings 26.01 to 26.17 do not include minerals which have been subjected to processes not normal to the metallurgical industry. It is seen that the product from the suppliers having 72% WO3 grade and described as coarse plus 74 micron gravity concentrate has already undergone the processes normal to the metallurgical industry such as crushing, grinding, flotation, tabling. It is marketable and can be utilised by the user industries. The product artifical or synthetic scheelite of a higher WO3 value is obtained by further processes and is chemically precipitated, which is something in addition to the normal processes, in order to make it acceptable to more discriminating consumers. In this context it will also be relevant to refer to the Test Report of the Customs House Chemical Examiner saying that the sample is an inorganic chemical calcium tungstate in powder form. Therefore, such a product will fall outside the scope of Chapter 26. In the MMTC case decided by the Supreme Court, relied on by the appellants, the Supreme Court had observed that basic operations necessary to produce usable Ore concentration will not take the product out of classification as `ore’. In the same judgment, the Hon’ble Supreme Court had noted that in that case the `ore’ was never subjected to any process of roasting or treatment with chemicals to remove impurities, whereas, here, we have seen that the artificial scheelite imported according to the suppliers’ literature is a molybdenum-free high purity calcium tungstate or a fine chemically precipitated artificial scheelite of approximately 77% WO3 to 78% WO3 grade. The same literature, further, shows that from the mine, tungsten is sold as a concentrate either wolframite or scheelite and the grade of concentrate has to be higher than 65% WO3. The product, which the suppliers describe as coarse gravity concentrate itself, has 72% WO3 grade and it is this product which they market as concentrate. In view of the above finding, it has to be held that artificial scheelite imported will fall outside the scope of Chapter 26 in view of Chapter Note 2, because it has been found that the product has been subjected to further processes of digestion, filtering and is obtained by chemical precipitation which is a process further to the normal processes of making the ore marketable or suitable for industrial users. Since classification has to be within the terms of the chapter notes and since the criterion therein is not whether the goods is in powder form or granual form, the submissions made in this behalf by the appellants that the mere fact that the product is in powder form should not be a ground for excluding the goods from Chapter 26, do not have much force. The Supreme Court judgment in the case of MMTC (supra) under the old Tariff Item 26 of ICT which did not have any chapter notes and was rendered in that context. The expert opinion by the Head of the Department of Physics, University of Pune dated 20-6-1986 has sought to compare natural scheelite and Australian Synthetic Scheelite alongwith precipitated calcium tungstate and has given his opinion that natural scheelite and Australian Synthetic Scheelite have identical structure. But the opinion of the Head of the Department was given without reference to the suppliers’ own literature regarding the processes and products which has been extracted and referred to above from which it is evident that what is imported is chemically precipitated artificial scheelite. So also, Shri T.R.S. Krishnan, Ex-Dy. Chief Chemist had given his opinion without having the benefit of perusal of the suppliers’ literature and had given his opinion that the product imported is scheelite ore from which associated impurities are removed by usual ore processing method. In the result, it is held that the lower authorities were right in not classifying whether or not containing impurity as the goods are separate chemically defined compound. It had been contended before us that classification of the item under Heading 28.51 as other organic compounds is not an appropriate that being residuary item. The Ld. D.R., before us, urged that the goods would be appropriately classifiable under Heading 2841.80 as tungstate. We find that in the Assistant Collector’s order in assessment, no heading or sub-heading under Chapter 28 has been indicated. It is only in the Collector (Appeals’) order that sub-heading 28.51 has been mentioned as the tariff heading under which the lower authorities had assessed the goods. From the perusal of these two tariff headings, it appears that the tariff rate of duty on both the headings appears to be the same. However, I do not feel called upon to pronounce on this issue as the appellants have not made submissions as between these two entries under Chapter 28 since their case is that Chapter 28 is not applicable at all to the goods imported, which it is found, is not sustainable. In the result, I do not see any reason to interfere with the order passed by the lower authorities. The appeal is rejected.

10. [Contra per : S.L. Peeran, Member (J)]. - I have gone through the order prepared by learned brother, Shri K.S. Venkataramani, Member (Technical) but I could not pursuade myself to agree with the reasoning given by him, to classify the product scheelite as inorganic chemical compound under Chapter Heading 28 of CTA which had been described by the appellant in this case under Heading 2611.00 of Tariff Act as `Tungsten Ore and concentrates’.

11. The appellants have produced enormous evidence in this case to support their case that the product is Tungsten Ore and not a chemically defined compound. They have also relied upon certain citations. The entire evidence and citations have been discussed in the main order. The main question which has to be considered by us is whether the product is a `Tungsten ore’ classifiable under Heading 28 or as chemically defined compound classifiable under Heading 2611.00 to the First Schedule of the Customs Tariff Act. The bill of entry describes the goods as `Scheelite Concentrates’ (Australian Kind Island Scheelite Tungsten Ore), and the heading shown is 2611.00. A sample was sent to the chemical examiner wherein 3 questions were posed to him :-

(1) Nature and composition; (2) Percentage of WO_3; (3) Whether Tungston ore. The Chief Exanminer who submitted his report has not answered any of the questions posed to him but instead has answered that “the sample is an inorganic chemical calcium tungstate ore in the form of white powder”. The main question that should have been answered by Chemical Examiner with regard to questions posed to him is not answered at all by him. Therefore, the appellants relying on the various materials produced by them has got to be looked into. In the first instance, it has to be examined whether the product is Tungsten Ore and whether it is traded in the market as an Ore. There is no difficulty to come to the conclusion that the product has been imported as Tungsten Ore, as Bill of Entry describes it so. The onus of classification is on the department but they have not produced any evidence of any sort to reject the contention that the product is not Ore at all and that it is chemically defined compound. The various materials produced by the appellant in support of their contention was not before the lower authorities but the Counsel had submitted that these materials should be looked into although produced for the first time. In support of his contention, he had also relied upon the ruling given by this Tribunal in the case of M/s. Power Cable Industries, Bombay v. Collector of Central Excise, Bombay reported in 1983(10)LCX0005 Eq 1984 (016) ELT 0285 (Tribunal). We have accepted the contention of the appellants to consider the matter on merits and have taken up the matter for so consideration on merits. There were certain materials before the lower authorities i.e. the analysis certificate produced by the importer which describes the goods as `Artificial Scheelite’ describing the product as WO3 with percentage as 78.6% and it certified that crystallographic structure of Spanish natural Scheelite and king island scheelite is similar. The letter of Shri P.S. Damle, Head, Department of Physics, University of Poona was also before the lower authorities. However, the same was rejected. The appellants have produced a chart which shows various processes of the mining and also various other processes the Ore undergoes before it is in a position to be packed and transported. Does this process of making the Ore transportable make it a separate chemically defined compound? The answer is in the negative. The product Scheelite Ore cannot be transported in the form it is mined. The same has got to be processed before it is in a position to be packed and transported. This fact is not denied by the Department. The view taken by the Supreme Court in the case of M/s. MMTC Ltd. v. Union of India and Others as reported in AIR 1972 SC 2551 in respect of Wolfram WO3 is very material for considering this aspect of the matter. The Supreme Court has held in Para 4 that “Wolfram is always selectively mined in the technical terminology. The selectively mined tungsten contains about 70% WO3. Such selective mining does not constitute a manufacturing process. Unless selective mining is done the tungesten ore cannot be exported or even sold in the country of its origin”.

12. It has again been held in Para 5 that “If Item 26 of the Import Tariff is to be restricted to Wolfram being material containing 0.5 to 2 per cent WO₃ it would be mainly rock which could not be imported in large quantity and which will have no market. The separating of wolfram ore from rock to make it usable ore is a process of selective mining and not a manufacturing process. The important test is that the chemical structure of the ore should remain the same. Whether the ore imported is in powder or granule form is wholly immaterial. There is a preponderating weight of authority both of experts and of books and writings on the subject which show that wolfram ore, when detached and taken out from the rock in which it is embedded either by crushing the rock and sorting out pieces of wolfram or washing or magnetic separation and other similar and necessary process, becomes a concentrate but does not cease to be ore. Unless the ore is roasted or treated with any chemical it cannot be classed as processed”.

13. It is, however, held at Para 6 that “There can, therefore, be no manner of doubt that the goods imported by the appellants fell within Item 26 of the Import Tariff and no duty was leviable on them.” In this case also, the appellants have produced preponderating weight of authority both of experts and of books and writings on the subject. the Importer’s literature shows that “Tungsten is found in nature as mineral and there are numerous tungsten minerals. The main ones are wolframite (or wolfram) and scheelite. Wolfram is an iron manganese tungstate while scheelite is a calcium tungstate. Scheelite ore is generally a dull metallic grey to the naked eye. It is best seen under ultra violet light where it fluoresces blue (pure scheelite) or yellow (impure scheelite containing molybdenum). About 60% of the tungsten used in the world goes to make tungsten carbide, a hard wear resistant material used for lathe tools, saw blades, percussion bits and such like. The other major usage is for various types of tool and alloy steels. An interesting use has been electric lamp of filaments because of the high melting point of tungsten. The price of tungsten has always been volatile and fluctuates greatly. From the mine, tungsten is sold as a concentrate - either wolframite or scheelite. The tungsten in the concentrates for sale purposes is assayed as tungstic oxide - WO_3. For weight the concentrates are measured in M.T.U.’s, which is 1/100 of a metric tonne. The grade of concentrate has to be higher than 65% WO3”. The literature gives details of metallurgical operations comprising of general milling operations, curshing, grinding, gravity concentration and flotation. This process in no way has changed the nature of Ore as can be seen by supporting evidence produced by the appellants, the evidence of Shri P.S. Damle, Head of Physics Department, University of Pune, the affidavit of Shri T.R.S. Krishnan, literature of Australian King Island Scheelite Ore, details of natural scheelite and synthetic scheelite supplied by supplier. This literature shows that the imported product is only Ore from which associated impurities are removed by usual Ore processing method and the product is a natural one and not a chemically prepared Calcium Tungstate. The evidence of the appellant with regard to trade parlance has been produced to show that the product is marketed as Ore and not as chemically defined compound. In view of these materials as well as definition of scheelite found in Encyclopacdia, Britannia Macropedia, Volume 13 and also the definition appearing in Shorter Oxford English Dictionary, Webster’s 3rd TNTL Dictionary, Oxford Reference Dictionary, Chambers Dictionary, New Webster INTL Dictionary, the product imported is an Ore and not a chemically defined compound. Therefore, I order for classifying the same under Chapter Heading 2611.00. Accordingly, I allow the appeal.

14. [Order per : Harish Chander, President]. - There is a difference of opinion between Ld. Brother Shri K.S. Venkataramani, Member (T) and Shri S.L. Peeran, Member (J). The following point of difference has been referred to me :

“Whether the goods imported described in the Bill of Entry as ”Scheelite Concentrates (Australian King Island Scheelite Tungsten Ore)" is correctly classifiable under sub-heading 2611.00 CTA ‘75 covering tungsten ore and concentrate, or whether the goods are to be classified as inorganic chemical calcium tungstate under Chapter 28 CTA."

15. Ld. Brother K.S. Venkataramani, Member Technical has narrated the facts in his order and as such I need not reproduce the same.

16. Shri Rohan Shah, Advocate with Shri A. Shirazi, Advocate has appeared on behalf of the appellant. Ld. Advocate pleaded that the appellant had imported 4000 Kgs. Scheelite Concentrates declared as Australian King Island Scheelite Tungsten Ore. He pleaded that it is mineral and chemical name is calcium tungstate (CaWO_4). The appellants had claimed assessment under heading 2611.00 of the Customs Tariff Act, 1975, whereas the Revenue has assessed the same under Heading 2851 of the CTA, 1975. He pleaded that the Bill of Entry was filed on 3rd September, 1986 which is Ex. B and appears at page 22 of the paper book. He pleaded that the Revenue Authorities had taken the opinion of Deputy Chief Chemist and he has given his report on 28th October, 1986. Sample was drawn on 6th October, 1986. He pleaded that the origin of the goods is Australian King Island and the goods imported by the appellants are used by the appellants for making Tungsten and Tungsten Carbide. He argued that the adjudication order was dated 5-1-1987. Last date of hearing before the adjudicating authority was also 5-1-1987. No show cause notice was issued. On 23-12-1986 the appellant had written a letter to the Revenue Authorities which appears as Ex. G and in that letter it has been mentioned that Mr. S.G. Pendsay met the Deputy Chief Chemist and during discussion the appellants were told that the Australian Scheelite in appearance looks very much different than Natural Scheelite and possibly because of some chemical treatment by the manufacturer during the manufacturing process the crystal structure has changed. He pleaded that the Order-in-Original has been passed by the A.C. and being not satisfied with the order passed by the A.C. an appeal was filed and the Collector (Appeals) passed order on 20-6-1988. He referred to Chapter Note 2 of Chapter 26 which appears on page 4 of the Appeal Memo. He pleaded that for the purposes of Headings 26.01 to 26.17, the term “ores” means minerals of mineralogical species actually used in the metallurgical industry for the extraction of mercury, of the metals of Heading 28.44 or of the metals of Section XIV or XV, even if they are intended for non-metallurgical purposes. Headings 26.01 to 26.17 do not, however, include minerals which have been submitted to processes not normal to the metallurgical industry. Ld. Advocate referred to the Telex which appears on page 36 of the paper book and laid emphasis on Para 2 and in the Telex it is mentioned that the process of enrichment concentration employed is basically the same all over the world, namely, by gravity, flotation and/or chemical methods all normal in the industry. He referred to the Deputy Chief Chemist’s report which appears on page 24. The report says that the sample is an inorganic chemical Calcium Tungstate in the form of white powder. Shri Shah, Ld. Advocate pleaded that the report of the Deputy Chief Chemist should not be relied upon as there were three queries - (1) nature and composition, (2) percentage of Wo3, and (3) whether Tungsten Ore. He pleaded that the Deputy Chief Chemist has given report only on the nature of the product. He referred to page 6 of the compilation where the definition of mineral is given in Oxford Reference Dictionary as a substance obtained by mining, a natural inorganic substance having a definite chemical composition and usually a characteristic crystalline structure. A rock may be made up of one type or several types of mineral. An artificial mineral water or similar drink. adj. 1. obtained by mining. 2. inorganic not animal or vegetable - mineral water. Water found in nature impregnated with a mineral substance; an artificial imitation of this; a non-alcoholic effervescent drink. He referred to the definition as given in Chambers Dictionary which appears on page 7 of the paper book :

“Mineral. a substance produced by processes of inorganic nature; a substance got by mining ore; a substance neither animal nor vegetable; a mine: a person: a mineral water (in a wide sense); adj. relating to minerals; having the nature of minerals; impregnated with minerals, as water; of inorganic substance or nature”.

He also referred to the definition as given in New Webster International Dictionary which appears on page 8 of the paper book :

Mineral. 1. Any of a class of substances occurring “in nature usually comprising inorganic substances as quartz feldspar etc. of definite chemical composition and usually definite crystal structure but sometimes also including rocks formed by these substances as well as certain natural products of organic origin as asphalt coal etc. 2. a substance obtained by mining; ore. 3. any substance that is neither animal nor vegetable. 4. Mineral, Brit. see mineral water - adj. 5. of the nature of a mineral; pertaining to a mineral or mineral. 6. containing or impregnated with a mineral or minerals. 7. neither animal nor vegetables; nor inorganic : mineral matter. (Late ME ML. Minerale) (n) Mineralis (Adj.) equiv. to miner (a) mine. ore.”

17. Shri Shah referred to page 45 of the paper book which is a letter written by King Island Scheelite to the appellants dated 14-5-1987 where they have certified that the products supplied by them was mineral not produced from chemicals and the King Island Scheelite mines natural scheelite and only produces scheelite concentrates (CaWo₄₎ in two forms i.e. normal gravity high molybdenum concentrate and normal technically molybdenum-free concentrate. He also referred to page 21 which is the packing list and weight and Analysis Certificate. He again referred to pages 1 and 3 of the compilation; page 1 relates to Encyclopedia Britanica Micropedia and `scheelite’ has been described as calcium tungstate mineral CaWo4 i.e., an important Ore of tungsten and on page 3 Shorter Oxford English Dictionary meaning of `Scheelite’ has been given as Tungstate of calcium found in brilliant crystals of various colours.

18. Shri Rohan Shah, Advocate referred to HSN page 203 and HSN Note 2. The description of the term “ore” has also been mentioned in the same page that ores are seldom marketed before “preparation” for subsequent metallurgical operations. The most important preparatory processes are those aimed at concentrating the ores. He also stated that Scheelite (CaWo₄₎ is a natural calcium found in igneous rocks usually with granite. He referred to page 40 of the appeal paper book where a detailed chart as to the processes has been given. He referred to Page 38 Para (d) of the letter dated 14th January, 1987 addressed to the Additional Collector of Customs where it has been explained that the ore imported by the appellants were exclusively used for making high purity Tungsten Metal and Tungsten Carbide products for which they had a valid Industrial Licence. He also referred to the affidavit of Shri T.R.S. Krishnan. He pleaded that Shri T.R.S. Krishnan is an M.Sc. in Chemistry and possessed 29 years experience in various capacities as Chemical Examiner, Deputy Chief Chemist in Customs and Central Excise and 6 years as General Manager, Govt. Opium & Alkaloid Works and had retired on 28-2-1986. He pleaded that the opinion of Shri Krishnan should have been accepted. In Paras 3 and 4 he has again mentioned that ores as and when excavated are always associated with various impurities and also some undesired chemical constituents. Before these are marketed to reduce the bulk and make it more usable and trade form, these are purified and concentrated. The purification/concentration of the ore is done after crushing by various methods like froth floatation, washing, filtration, gravitational and magnetic separation and depending on the ore and the use to which it is put one or more of the above processes are adopted and a marketable commodity (Ore) is obtained. The important point is the chemical and crystallographic structure of the ore should remain the same and whether ore is in powder, pulp or granule form is immaterial and the material in the trade is known as `ore’.

19. Shri Rohan Shah, Ld. Advocate also referred to the order of Shri K.S. Venkataramani (Member Technical) internal page 11. He has dealt with the process of manufacture and other facts. Shri Shah referred to page 12 of the compilation in which Metallurgical Operations have been explained. He also referred to the Products & Process which appears on page 40 of the paper book. Ld. Advocate relied on a Supreme Court decision in the case of MMTC v. Union of India - AIR 1972 SC 2551 at 2554. He also referred to another decision in the case of Indian Hard Metals (P) Ltd. v. Union of India reported in 1978 (002) ELT (J 667 and 670). He laid special emphasis on Para 7. Ld. Advocate pleaded that after the process there is no change in the chemical structure. He referred to page 25 of the paper book which is a certificate from University of Poona, Department of Physics, by Shri P.S. Damle, Head of the Physics Department. He argued that the opinion of Chief Chemist is in appellant’s favour. He referred to Section Note 2 of Heading 28.51. He argued that Chapter 28 comes under Sections V and VI of the Customs Tariff Act, 1975. Section VI relates to the products of the Chemical or Allied Industries, whereas it is a mineral product. He referred to Chapter Note 3 of Chapter 28 “or other products of Section V”. He pleaded that 28.51 is a residuary heading relating to other inorganic compounds. Ld. Advocate referred to the following judgments :

1. Bharat Forge & Press Industries (P) Ltd. v. CCE - 1990(01)LCX0072 Eq 1990 (045) ELT 0525 (S.C.)

2. Indian Metals & Ferro Alloys Ltd. v. CCE - 1990(11)LCX0014 Eq 1991 (051) ELT 0165 (S.C.)

3. Dunlop India Ltd. v. Union of India - 1975(10)LCX0016 Eq 1983 (013) ELT 1566 (S.C.) - Para 37.

Ld. Advocate pleaded that the onus for changing the classification is on the Revenue which the Revenue has failed to discharge. Ld. Advocate relied on the decision in the case of Colgate Palmolive (India) Ltd. reported in 1980(01)LCX0012 Eq 1980 (006) ELT 0268 (Bom.) and Collector of Central Excise v. Calcutta Steel Industries & Ors., 1988(10)LCX0027 Eq 1989 (039) ELT 0175 (S.C.), Suja International v. Collector of Customs reported in 1987(09)LCX0057 Eq 1989 (044) ELT 0387 (Tri.). Garware Nylons Ltd. v. Union of India, 1980(04)LCX0012 Eq 1980 (006) ELT 0249 (Bom.).

20. He also referred to page 21 of the appeal paper book i.e., the Weight and Analysis Certificate. Page 45 i.e. a letter written by King Island Scheelite to the appellants dated 14th May, 1987. Ld. Advocate referred to the following decisions :

1. Dunlop India Ltd. v. Union of India - 1975(10)LCX0016 Eq 1983 (013) ELT 1566 (S.C.).

2. CCE, Bombay v. Rohit Pulp & Paper Mills Ltd. - 1985(02)LCX0057 Eq 1985 (021) ELT 0571 (Tri.).

The Advocate pleaded that in case there is some doubt as to the classification the assessee must be given the benefit of doubt. In support of his argument he referred to the decision in the case of Collector of Central Excise v. Metrowood Engineering Works reported in 1989(02)LCX0063 Eq 1989 (043) ELT 0660 (Tri.). He pleaded that the correct classification is under Chapter 26 and pleaded for the acceptance of the appeal.

21. Ld. SDR Smt. Ananya Ray has appeared on behalf of the respondent. Ld. DR pleaded that whatever has been imported, it is to be seen whether it is in natural form or in some chemical form. She relied on the Order-in-Original and relied on all the arguments advanced by the DR Shri S. Chakraborty. She referred to page 39 of the paper book and there is a comparative table of Natural Scheelite and Synthetic Scheelite. A perusal of the same shows that Natural Scheelite WO₃ is typical 73% and Synthetic Scheelite WO3 is typical 75%. She referred to page 21 which is Packing List and as per analysis WO3 is 78.9%. She referred to page 39 where synthetic scheelite where WO3 Typical is shown as 75.00%. She referred to page 12 of the compilation where metallurgical operations have been dealt with. She referred to the Condensed Chemical Dictionary, Tenth Edition page 857. She also referred to the affidavit of Shri Krishnan (page 32 of the paper book). She referred to Interpretatory Rule 3(c) of the Customs Tariff Act. Smt. Ananya Ray, Ld. SDR made an alternative plea that if the original classification made was not accepted alternatively it may be assessed under 2841.90. She pleaded for dismissal of the appeal. She relied on the order of the Member Technical and pleaded for the dismissal of the appeal.

22. Shri Rohan Shah, Ld. Advocate in reply argued that Natural Scheelite or Synthetic Scheelite is not relevant. The goods imported are `ore’ and has to be assessed as `ore’. He referred to HSN Chapter 26 and laid special emphasis on the last line : “The chemical processes are aimed at eliminating the unwanted matter”. He pleaded that there is no change in chemical structure. He referred to the Deputy Chief Chemist’s report. He pleaded that the chemical examiner’s report is silent on the chemical structure which is very relevant. He referred to interpretatory Rule 3(c). He pleaded that the argument of the Ld. SDR for classification under Heading 2841.90 cannot be entertained at this stage as there is no cross-objection and no cross-appeal. He again referred to page 203 of the HSN and also Heading 26. Ld. Advocate pleaded that CCCN notes render valuable assistance and referred to the decision in the case of Hindustan Thermo Prints v. Collector of Customs reported in 1989 (043) ELT 121. He has pleaded for the acceptance of the appeal.

23. I have heard both the sides and have gone through the facts of the case. There is no dispute as to the importation of the product. The product imported is by the chemical name calcium tungstate (CaWO₄₎ and the trade name is Scheelite Concentrate. The appellant is claiming assessment under Heading 2611.00, Customs Tariff Act, 1975, whereas the Revenue has assessed the same under Heading 2851.00. The Bill of Entry was filed on 3rd September, 1986 which appears on page 22 of the paper book and sample was drawn on 6th October, 1986 and the Deputy Chief Chemist’s report is dated 28th October 1986 which appears on page 24 of the paper book. The issue to be decided by me is whether the goods as described in the Bill of Entry `Scheelite Concentrate’ (Australian King Island Scheellite Tungsten Ore) is classifiable under sub-heading 2611.00 or to be classified as Inorganic Chemical Tungstate under Chapter 28 of Customs Tariff Act, 1975. For the proper appreciation of the correct position and description in the Tariff as given in Para 7 of Appeal Memo internal page 4 is reproduced below :

Sub-heading No. 2611.00 falls in Chapter 26 of the First Schedule to the Customs Tariff Act and provides as follows :-

Chapter Note 2 of Chapter 26 provides as follows :-

“2. For the purposes of Heading Nos. 26.01 to 26.17, the term `ores’ means minerals of mineralogical species actually used in the metallurgical industry for the extraction of mercury, of the metals of Heading No. 28.44 or of the metals of Section XIV or XV even if they are intended for non-metallurgical purposes. Heading Nos. 26.01 to 26.17 do not, however, include minerals which have been submitted to processes not normal to the metallurgical industry.”

Heading 2851.00 as appearing in para 10 of the Appeal Memo internal page 5 is also reproduced below :

Notification 78/86-Cus., dated 17-2-1986 exempted inter alia concentrate of tungsten falling within Chapter 26 of the First Schedule to the Customs Tariff Act from so much of that portion of the duty of customs leviable thereon as was in excess of 40% ad valorem. The notification is reproduced below :

“Effective rates of duty for specified Metallic ores and concentrates. - In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts Metallic ores and concentrates (excluding ore) and concentrates of Antimony, Tungsten and Zinc falling within Chapter 26 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), from so much of that portion of the duty of customs leviable thereon which is specified in the said First Schedule as is in excess of the amount calculated at the rate of 40% ad valorem.

2. This Notification shall come into force on the 28th day of February, 1986."

The description of the goods in the Bill of Entry filed by the appellants appears on page 22 of the paper book and is given below :

“Scheelite Concentrates (Australian King Island Scheelite Tungsten Ore).”

A perusal of the Bill of Entry shows that the appellant’s main claim was that it is an ore. The revenue authorities being not satisfied with this, a sample was drawn on 6th October, 1986. The same was sent to the Deputy Chief Chemist and the Deputy Chief Chemist vide his report dated 28th October, 1986 which appears on page 24 of the paper book had opined as under :

“The sample is an inorganic chemical calcium tungstate in the form of white powder.”

A perusal of the test report shows that the product imported is inorganic chemical tungstate. I have reproduced tariff heading above. A perusal of Chapter Note 2 of Chapter 26 shows that for the purposes of Heading Nos. 26.01 to 26.17, the terms `ores’ means minerals or mineralogical species actually used in the metallurgical industry for the extraction of mercury, of the metals of Heading No. 28.44 or of the metals of Section XIV or XV even if they are intended for non-metallurgical purposes. Heading Nos. 26.01 to 26.17 do not, however, include minerals which have been submitted to processes not normal to the metallurgical industry. The appellant has filed Packing List dated 15th August, 1986 issued by King Island Scheelite and below the Packing List it has been mentioned as Weight and Analysis Certificate. For the proper appreciation the certificate as filed by the appellants which appears on page 21 of the paper book is reproduced below :

KING ISLAND SCHEELITE

A perusal of the same shows that the description of the product has been given as Artificial Scheelite and percentage of WO₃ is 78.9%. On page 39 appears a Korea Tungsten chart. The presence of Typical Natural Scheelite has been described as Grain sized natural scheelite superbly suitable for tungsten alloys, manufacture of ferro-tungsten. .... where molybdenum element is required .... in high speed steel application and the percentage of WO3 Typical is 73%; and in Synthetic Scheelite the description has been given as High grade fine powdered scheelite, best used for manufacture of high-purity metal powder ... when nodulized, outstanding as direct additive to steel and WO3 Typical is 75%. The uses of Natural Scheelite is grain sized, whereas the Synthetic Scheelite is in the form of fine powder and the percentage of Synthetic Scheelite is 2% higher than the Natural Scheelite.

24. Shri K.S. Venkataramani, Member (Technical) in his order (internal page 8) has given a detailed description for the proper appreciation which appears on pages 10 to 13 of the compilation i.e., the operations at King Island Scheelite. The same is again reproduced :

On page 40 appears a Products & Process Chart. A perusal of the same shows that there are separate products known in the trade which has been shown as Natural Scheelite and also Synthetic Scheelite. A perusal of the chart shows that the mine after crushing is subjected to grinding, flotation and tabling and after tabling Natural Scheelite is obtained, whereas for Synthetic Scheelite from tabling it has to go through the processes of digestion, filtering, and from filtering the chemical process of precipitation has to be gone into and thereafter Synthetic Scheelite is produced.

25. Shri K.S. Venkataramani (Technical Member) in his order has clearly mentioned that tungsten concentrate for sale purposes has to be higher than 65% WO₃ i.e., Tungstic Oxide. Hon’ble Member Technical has given detailed reasoning in his order. The description of Scheelite is given in Encyclopedia Britanica (page 1 of the compilation). A perusal of the same also shows that “the Mohs hardness is 4^1/_2-5; specific gravity 5.9-6.1; and crystal system, tetragonal. `Scheelite’ in Shorter Oxford English Dictionary (page 3 of the compilation) has been defined as Tungstate of calcium, found in brilliant crystals of various colours. McGraw Hill Dictionary of Scientific and Technical Terms Second Edition has given the description of Calcium Tungstate as ”White, tetragonal crystals, slightly soluble in water; used in manufacture of luminous paints. Also known as artificial scheelite; calcium wolframate". It has been described as inorganic chemical. The description of Scheelite (mineral) CaWO4. A yellowish white mineral crystallizing in the tetragonal system and occurring in tabular or massive form in pneumatolytic veins associated with quartz; an ore of tungsten.

26. A perusal of the above definitions in McGraw-Hill Dictionary shows that chemical formula for Calcium Tungstate as well as Scheelite is CaWO_4. Calcium Tungstate is an inorganic chemical. Scheelite is mineral.

27. I have already reproduced the Packing List above. In the Packing List itself the description has been given as Artificial Scheelite packed in 100 litre steel drums of 250 kgs. each and the percentage of WO₃ is 78.9. Mineral Ore is always natural. In the Packing List with Weight and Analysis Certificate which appears on page 21 the description itself is Artificial Scheelite. Artificial Scheelite can never be equated with Natural Scheelite. Ld. Advocate had pleaded that BTN have persuasive value and as such the goods should be assessed under Chapter 26. The Tribunal in the case of Keltron Power Devices Ltd. v. Collector of Customs reported in 1987 (028) ELT 93 at page 99, Para 18 had held as under :

It was also held in Nivedita Chemicals Pvt. Ltd., Bombay v. Collector of Customs, Bombay reported in 1985 (020) ELT 382 that BTN Explanatory Notes have only persuasive value and cannot be engrafted into Customs Tariff Act when not incorporated therein. Tribunal in the case of Saurashtra Chemicals, Gujarat v. Collector of Customs, Bombay reported in 1983(04)LCX0048 Eq 1983 (013) ELT 1182 [Para 7] had held as under :

The Advocate had pleaded reliance on the judgment of the Supreme Court in the case of MMTC. The judgment is not applicable in this case as it was under the old Tariff. The Advocate has cited other decisions too. The judgments cited by the Ld. Advocate does not help. Larger Bench of the Tribunal, in the case of Saurashtra Chemicals, Porbandar v. Collector of Customs, Bombay reported in 1986 (023) ELT 283 has held that Section Notes and Chapter Notes are part of statutory tariff. Relevant para of the said judgment is reproduced below :

Para 7. “But we observe that the Customs Tariff Act has not left the matter to be decided just on that basis. The relevant headings in the Tariff have to be interpreted and applied in the light of the Section Notes and Chapter Notes which are statutory and binding like the headings themselves. These Section Notes and Chapter Notes sometimes expand and sometimes restrict the scope of certain headings. In other words, the scheme of the Customs Tariff Act is to determine the coverage of the respective headings in the light of the Section Notes and Chapter Notes. In this sense, the Section Notes and Chapter Notes have an overriding force on the respective headings.”

Since the goods imported are inorganic chemical and as such the possibility of their classification under Chapter 26 is ruled out. The goods have to be classified under Chapter 28.51.

28. Other chemical reports obtained also cannot be relied upon as their samples were drawn when the goods were out of the control of the Customs authorities. The Revenue authorities had well discharged its onus for coming to a different classification in view of the Deputy Chief Chemist’s report, the extract of which has been reproduced above. In view of these observations, I agree with the conclusion arrived at by my Learned Brother K.S. Venkata- ramani, Member (T). I hold that the goods are to be classified as Inorganic Chemical Tungstate under Chapter 28 of the Customs Tariff Act under Heading 28.51. There is no cross-objection by the Revenue or cross-appeal by the Revenue and as such it will not be proper for me to hold that the classification falls under different sub-heading. The matter now be placed before the original Bench for issuing final order.

In view of the majority decision, the appeal is rejected.

_______

Equivalent 1994 (72) ELT 139 (Tribunal)