2000(09)LCX0032
IN THE CEGAT, EASTERN BENCH, CALCUTTA
Smt. Archana Wadhwa, Member (J) and Dr. S.N. Busi, Member (T)
OXIDE (I) PVT. LTD.
Versus
COMMISSIONER OF CENTRAL EXCISE, BOLPUR
Order No. A-1549/CAL/2000, dated 19-9-2000 in Appeal No. ER-475/98
CASE CITED
United Industries v. Collector — 1993(04)LCX0024 Eq 1994 (070) ELT 0141 (Tribunal) — Referred..................... [Para 5]
Advocated By : Shri B.N. Chattopadhyay, Consultant, for the Appellant.
Shri R.K. Roy, JDR, for the Respondent.
[Order per : Archana Wadhwa, Member (J)]. - The dispute involved in the present appeal is as to whether the appellants' product alumina balls/pellets/extrudates/lumps manufactured by them would be classified under heading 6907.00 of the CETA, 1985, as held by the authorities below or the same would be classified under sub-heading 3815.00 or 6901.00, as claimed by the appellant.
2. Dispute as regards the correct classification of number of items was raised in the proceedings before the Asstt. Commissioner. However, the appellants have accepted the order of the authorities below in respect of their other products. The only dispute which survives is as regards the classification of the above product.
3. With regard to the above products the appellants' contention is that the same should be classified either under chapter sub-heading 3815.00 or 6901.00 due to the following reasons :
(i) These products are Catalyst Bed Supports or Alumina Bed Supports or Refractory Bed Supports but not Catalyst Support/Carriers.
(ii) By virtue of similarity of method of preparation and use in the catalyst reactor along with the catalyst it was suggested for their inclusion in SH No. 3815.00.
(iii) For their refractory character, resistance to thermal shock, resistance to high temperature, low porosity and inertness it was suggested for their inclusion in Chapter SH. No. 6901.00.
(iv) Asstt. Commissioner, Jabbalpur and Mumbai Commissionerate had classified these products, under chapter SH No. 6901.00, Patna Commissionerate had classified these products under SH No. 3815.00. .
(v) Catalyst Supports are identical to Catalyst Carriers and both are qualitatively different from Catalyst Bed Supports or Refractory Bed Supports. A comparative statement showing the differences between the Catalyst Support/Carriers and Catalyst Bed Support/Refractory Bed Support is appended below :
| Catalyst Support/Carrier | Catalyst Bed Support/Refractory Bed Support. | ||
| (1) | These are an integral part of Catalyst. | (1) | They are a different class of items independent of Catalysts. |
| (2) | They generally have higher porosity. | (2) | They generally have lower porosity. Lower the porosity, better will be the Bed Support. |
| (3) | They cannot be used as such in an industry save and except by Catalyst manufacturers for processing them into Catalysts. | (3) | They are used as such by most of the basic industries such as Fertilisers, Petro-chemicals, Refineries etc. Catalyst Support are not used in such industries. |
| (4) | They are always and without exception imprgnated with active ingredients such as Nickel, Cobalt, Molybdenum Precious metal such as Platinum Rhodium, Palladium, etc. | (4) | They are used as such, as they are end products by themselves. |
| (5) | In the manufacturing process of Catalyst Support/Carrier Alumina may have to be prepared by precipitation/chemcial reaction for getiting product with desired physical and chemical characteristics. The heat treatment is generally done at lower temperature. | (5) | In the manufacturing process of Bed Support Alumina need not have to be made. It may be purchased from the market and processed. Heat treatment is generally done at higher temperature. |
| (6) | They may/may not be temperature resistant and are amenable to thermal shock. | (6) | They must have to be temperature resistant and resistant to thermal shock and resistant to corrosion from acid and alkali. |
| (7) | Whenever catalyst is deactivated and discarded catalyst supports/carriers are also to be discarded since they are part and parcel of the catalysts. | (7) | Bed Supports are, however, never deactivated and not discarded along with the Catalyst. They can be reused and the life is much longer than catalyst and catalyst supports. |
| (8) | Catalyst Support/Carrier being an integral part of the catalyst participates to control the chemical change reaction. | (8) | Catalyst Bed Support does never participate in any chemical reaction. |
4. Arguing on the appeal Shri B.N. Chattopadhyay, ld. consultant submits that the authorities below have classified the product in question under sub-heading 6907.00 on the basis of the Board's instructions that Alumina balls/lumps used as carrier in the fertiliser industry is not classifiable under sub-heading 2804.90. It being Ceramic article would attract duty under Sub-heading 6907.00 of the Central Excise Tariff as Ceramic wares for laboratory, chemical or technical use. Reference has also been made to HSN explanatory notes in Sl. No. 1 against heading No. 69.09 which is to the effect that laboratory wares include supports for filters and catalysts. Reliance has been placed on the opinion of Deputy Chief Chemist of Central Revenue Laboratory, Delhi suggesting that classification of Alumina balls/rings etc. used as carriers for catalyst should be classified under sub-heading No. 6907.00 as ceramic wares for chemical and other technical uses. They have also observed that Alumina is used in many industrial catalytic processes, both as catalyst and support as catalytically active components. They have further added that an article of ceramic used as support for catalyst would be covered under chapter 6907.00 which is analogus to corresponding sub-heading No. 6909.00 for such products in HSN.
5. It is the contention of Shri Chattopadhyay that the Asstt. Commissioner as also the Commissioner (Appeals) and the Deputy Chemist have wrongly judged the appellants' product to be catalyst supports and carriers and not as catalyst bed support or refractory bed support even though the two are entirely different items in respect of their character, their physical and chemical properties and their end-use. He submits that they are not disputing that the catalyst carriers and supports manufactured and sold by the appellant company can be classified under chapter sub-heading No. 6907.00, but the same consideration will not apply in respect of bed support of Alumina/Silica Alumina made by them since the later items cannot be called catalyst support or carrier. Technical data as also the order placed by their customers have been placed on record showing the use of the Aluminium balls and lumps as bed supports. Strong reliance has also been placed upon the decision of the Asstt. Commissioner of Jabbalpur and the order passed by Mumbai Commissionerate classifying the item under sub-heading 6901.00. The appellants have also strongly objected to the opinion of the Deputy Chief Chemist proposing classification of the product under heading 6907.00. It has been argued that classification is required to be done by the Asstt. Commissioner and the chemical examiner does not have any authorities to express his views upon the Tariff heading in which the goods should be classified. In respect of their above submissions reliance has been placed upon the Tribunal's decision in the case of United Indus. v. CCE, Begalpura, 1993(04)LCX0024 Eq 1994 (070) ELT 0141 (Tribunal) = 1993 (047) ECR 351.
6. Shri R.K. Roy. ld. JDR appeared on behalf of the Revenue and reiterated the reasoning of the authorities below.
7. We have given our careful consideration to the issue involved before us. The dispute relates to only Alumina ball/pellets/lumps used as refractory bed support. Though the appellants before the authorities below contended that their product would be either classifiable under Chapter 3815.00 as recovery initiators, they limited their arguments during the course of hearing only in support of Heading 6901.00. As such the two contending entries before us are 6901.00 or 6907.00. For better appreciation of the divergent claims made by both the sides the two entries are being reproduced below :-
| Heading No. | Sub-heading No. | Description of goods | Rate of duty |
| (1) | (2) | (3) | (4) |
| 69.01 |
| Bricks, blocks, tiles and other ceramic goods of siliceous earths; refractory ceramic goods such as bricks, blocks, tiles, and similar refactory ceramic constructional goods and other refractory ceramic goods such as retorts, crucibles, muffles, nozzles, plugs, supports, cupels, tubes, pipes, sheaths and rods. |
|
|
| 6901.10 | -Clay Bricks other than fire-clay bricks | Nil |
|
| 6901.20 | -Burnt clay tiles conforming to IS specification No. 3367-1975 | Nil |
|
| 6901.90 | -Other | 15% |
| 69.07 | 6907.00 | Ceramic wares for laboratory, chemical or other technical uses; ceramic troughs, tubes and similar receptacles of a kind used in agriculture; ceramic pots, jars and similar articles of a kind used for the conveyance of packing of goods. | 15% |
8. The appellants’ contention is that Alumina balls/pellets are used as refractory bed support and are different than the Alumina carriers, the refractory bed support for which purposes the products in question are used act for removal of the impurities from the gas stream and to help in uniform distribution of feed gas. The same are for proper packing of catalyst bed in the converter as well as for protecting the catalyst bed from external impurities and disturbance and for uniform distribution of feed gas. Alumina balls, lumps etc. used as bed toppings and bed supports act as a guard to remove many impurities from the gas stream. The same do not act in the manner in which catalyst support acts. Whereas catalyst supports are part and parcel of the catalyst, bed supports are of lower porosity and inert in nature. Whereas catalyst support is porous and active.
9. We have seen the technical literature of the appellant company. Alumina balls or lumps have been shown to be used in Alumina bed toppings and supports. It is disclosed in the said literature that proper packing of the catalyst in the converter, as well as protecting the catalyst bed from external impurities, are essential for obtaining efficiency. Alumina balls, lumps etc. used as bed toppings and bed support act as filters to remove many impurities from the gas stream and help in uniform distribution of the feed gas. Lavers of these materials on the top and at the bottom of the catalyst bed, keep the bed intact during pressure fluctuation. As against salient features it is written as - safe for use in high temperature operations where silica carry over is a danger, e.g. Secondary Reformer in fertiliser industry. Can withstand severe thermal shocks. Long operating life unaffected by many cycles of emergency shutdowns and startups. As against this the technical literature shows the Alumina, rings, spheres and tablets as catalyst carriers.
10. Now it is to be seen as to whether balls and lumps in question which are admittedly used for toppings and bed supports can be considered as Alumina carrier supports so as to be classified under sub-heading 6907.00 as ceramic wares. From the technical literature and the uses and functions performed by the said Alumina balls it is clear that the same are not used as catalyst, but are meant for bed support and toppings. Heading No. 69.01 specifically mentions supports. As such they are undisputedly the refractory ceramic good with other ceramic products working at a temperature which it can withstand. The goods in question are designed for working at a higher temperature of 1600o to 1900° C. All refractory products are to be under chapter heading 6901 and the non-refractory ceramic goods fall under other headings of the chapter from 6902 to 6911. Even the HSN explanatory notes follow the said scheme inasmuch as chapter 69 has been sub-divided in two sub-Chapters, sub-chapter (I) is for refractory ceramic goods and entire sub-chapter II for non-refractory ceramic goods. From the description of all the headings of sub-chapter (I) it is seen that they are all put together in heading 6901, with an exception of goods of heading 6909 of sub-chapter (II), the appellants have contended that their product is a refractory ceramic product since it specifies all the requirements of refractory goods being as follows :-
(a) High refractoriness
(b) Resistance to chemical recovery with any substance in contact during their service i.e. it must be inert.
(c) Ability to stand the load of material under heat treatment in the furnace at the operation conditions.
(d) Resistance to thermal shock caused by alternate heating and cooling.
(e) Resistance to abrasion due to flow of charge, flames, flue dust, flue gases etc. and
(f) Low volume change at the service temperature (both permanent and reversible).
11. The above properties as noted, make it evident that the items are designed for working at higher temperature and are refractory material. The appellants have explained that the refractory bed support is not a catalyst carrier although both are made of the same material. The difference in the two is in the property of porosity which is about 10-20% in bed support and about 40% in catalyst carrier. The second difference is that these high Alumina balls having refractory characteristics are inert in nature while catalyst carriers are not so. These are also used at different places for different purposes. Even the HSN explanatory notes explaining the many types of refractory goods cover high Alumina refractory based goods and support the appellants. As such we agree with the appellants’ submission that the goods in question are properly classifiable under Heading 69.01.
12. As regards the opinion of the Deputy Chief Chemist, we fully agree with the submissions of the ld. consultant that it is not within the jurisdiction of the Chief Chemist to decide upon the classification of the goods, the same are required to be classified by the Central Excise proper officer after considering the various aspects of the issue.
13. We further note that heading No. 69.07 covers ceramic wares for laboratory, chemical or other technical uses. Inasmuch as we have already held that the Alumina balls, lumps having been used as bed supports are refractory material the same would not be covered by the heading 6907 inasmuch the same are also excluded from the purview of heading 69.09 (Analogous to heading 69.07 of CETA) vide HSN. The explanation under the said heading in HSN is to the effect that it does not, however, cover refractory goods of a kind designed for resisting high temperature as described in the general explanatory note to sub-chapter I. As such we do not find any justification in classifying the product under heading 69.07.
14. As regards the Board’s circular we find that the same is not applicable inasmuch as the same clarifies the position as regards Alumina balls/rings used as carriers and not used as bed support.
15. We also take note of the fact that the Asstt. Commissioner, Jabbalpur has held that Alumina balls (refractory bed support) is properly classifiable under heading 6901. We have seen the said orders, which is a detailed order and takes into consideration the technical as also the functional aspect of the goods in question. It is reported to us by the appellant that the said order has not been appealed against by the Revenue and as such has attained finality. The goods are being classified by the other manufacturers similarly situate under Sub-heading 6901.00.
16. In view of our foregoing discussion we hold that the Alumina balls/pellets/extrudates/lumps used as toppings and bed support are properly classifiable under Sub-heading 6901.00 of the CETA, 1985. The appeal is thus allowed in above terms.
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Equivalent 2001 (128) ELT 513 (Tri. - Cal.)
Equivalent 2000 (041) RLT 0801