1997(08)LCX0054

IN THE CEGAT, WEST ZONAL BENCH, MUMBAI

S/Shri Gowri Shankar, Member (T) and G.N. Srinivasan, Member (J)

COMMISSIONER OF CUSTOMS, MUMBAI

Versus

DUJODWALA PRODUCTS LTD.

Order No. 2681/97-WZB, dated 22-8-1997 in Appeal No. C/539/97-Bom.

CASE CITED

Khandelwal Metal v. UOI — 1985(06)LCX0008 Eq 1985 (020) ELT 0222 (S.C.) — Referred                                                   [Para 3]

Advocated By : Shri D. Gurunani, JDR, for the Appellant.

Dr. N.R. Kantawala, Advocate, with Shri S.N. Kantawala, Advocate, for the Respondents.

[Order per : Gowri Shankar, Member (T)]. - The issue for decision in this appeal is the classification in the Central Excise for the purpose of levy of additional duty of Customs, oleopine resin imported by the respondent. For the levy of additional duty of Customs equal to Central Excise duty for the time being in force it is the classification of Central Excise Tariff. The tariff has two headings in which the product can be classified. They are reproduced below :

The importer claimed classification of the goods under sub-heading 90. The Assistant Commissioner, after issue of notice and hearing him, has classified the product under sub-heading 10. In appeal, the Commissioner (Appeals) has set aside this classification, accepting the classification claimed by the importer in sub-heading 90.

3. The Departmental Representative by elaborating the arguments in the appeal, first contends that additional duty of Customs need not be necessarily be countervailing duty, relying upon the decision of the Supreme Court in Khandelwal Metal v. Union of India - 1985(06)LCX0008 Eq 1985 (020) ELT 0222 (S.C.). He next contends that Section 3(1) of the Customs Tariff Act provides in the explanation that where different rates of duties are prescribed for the same time, the highest of the rates would be charged. Both these arguments proceed on the assumption that the goods classifiable under sub-heading 10 and 90 are the same. This assumption is not warranted. If the goods were identical, they would be classifiable under one sub-heading and not under two. The fact that the legislature has chosen to provide two headings for a product, one where it is manufactured with the aid of power and the other where it is without the aid of power leads to the conclusion that the legislature intended to treat the two products, one manufactured with the aid of power and other without the aid of power as two distinct products for the levy of Central Excise duty. The Explanation to Section 3(1) would apply in cases where the product is classifiable under the same heading but different rates of duty are leviable on the same product as for example, by issue of a notification granting exemption to a product subject to fulfilling of condition. This argument therefore cannot be accepted.

4. The contention that existence of two sub-headings of which one is for goods manufactured with the aid of power answer the respondent’s contention that the goods, being natural product, do not require the aid of power for other product cannot be accepted. This is not the ground of which the Commissioner (Appeals) allowed the appeal. She had noted that the Assistant Commissioner had accepted the merits to some extent of the contention before her that the product was extracted without the aid of power, and that his decision to classify the goods under sub-heading 90 is not supported by any evidence. The Department’s appeal itself indicates that the importer had produced certificate from the supplier of the resin that no power had been used in its manufacture. The Commissioner (Appeals), also says that no evidence has been produced to show that power is used in or in relation to the extracts. We are therefore not required to go into the correctness or otherwise of this contention.

5. We have to conclude that the finding of the Commissioner (Appeals) has not been challenged by establishing that the power has been used in or in relation to the manufacture of the goods has not been successfully challenged in the appeal.

6. We therefore dismiss the appeal.

Equivalent 1997 (96) ELT 195 (Tribunal)

Equivalent 1997 (022) RLT 0841 (CEGAT)