Central Excise, Bhopal Vs. Minwool Rock Fibres Ltd.
Jurisdiction Civil Appeal No.4988 of 2003]
[With Civil Appeal
Nos.2504-2505 of 2004]
O R D E R
appeal is directed against the judgment and order passed by the Customs, Excise
and Gold (Control) Appellate Tribunal, New Delhi (for short 'the Tribunal') in Final
Order No.204/2002-D in Appeal No.E/964/2002-D dated 22.08.2002. By the impugned
judgment and order, the Tribunal has accepted the assessee's stand that the goods
namely, Slagwool and Rockwool are to be classified under Chapter sub-heading No.6807.10
by rejecting the stand of the revenue that it requires to be classified under sub-heading
assessee had filed the classification declaration before the adjudicating authority,
under Rule 173 B of the Central Excise Rules, 1944 (for short `the Rule), inter
alia, claiming that the goods, namely, Slagwool and Rockwool requires to be classified
under Chapter sub-heading No.6807.10 of Central Excise Tariff Act, 1985 (for short
`the Act') with effect from 09.06.1998.
show cause notice was issued to the assessee directing them to show cause as to
why the goods in issue should not be classified under Chapter sub-heading No.6803.00
and duty of 18% should not be charged and recovered from them under Rule 9(2)
read with Section 11-A of the Act and as to why penalty should not be imposed
under Rule 173Q of the Rules. After receipt of the show cause notice, the assessee
filed its reply dated 16.11.1998, inter-alia, contending that they are manufacturing
`Min wool' using more than 25% of blast furnace slag by weight, right from 1993
onwards and they have been filing classification declarations mentioning this fact
and such declarations so filed prior to 1997-98 are accepted by the department and,
therefore, the goods in question requires to be classified under Chapter
sub-heading No.6807.10 of the Act.
adjudicating authority, after accepting the stand of the assessee, passed an order
dated 31.01.2000, inter-alia, holding that the appropriate classification of the
goods in issue should be under Chapter sub-heading No.6807.10 of the Act. The revenue,
being aggrieved by the classification so accepted by the adjudicating
authority, had carried the matter by way of an appeal before the Commissioner (Appeals),
Customs and Central Excise, who by its order dated 23.01.2002, allowed the revenue's
appeal and, thereby, declared that the goods in question are to be classified under
Chapter sub-heading No.6803.00 and not under sub-heading No.6807.10, as claimed
by the assessee.
assessee had carried the matter in appeal before the Tribunal. The Tribunal has
allowed the assessee's appeal by its order dated 22.08.2002 and, thereby,
restored the order passed by the adjudicating authority. It is the correctness or
otherwise of the aforesaid order passed by the Tribunal is the subject matter of
need to notice the relevant entries under Chapter 68 of the Act and the sub heading
No.6803.00 and sub-heading No.6807.10 etc. The same reads as under : Heading Sub-
Rate of Description of Goods No. Heading Duty No. (3) (1) (2) (4) Slagwool, Rockwool
and 18% 6803 6803.00 similar wools Goods, in which more than 25% by weight of red
mud, press mud or blast furnace slag or one or more of these materials, have been
used, 6807 68.07 all other articles of stone, plaster, cement, asbestos, mica or
of similar materials, not elsewhere specified or included. Goods, in which more
than 25% by weight of red mud, press mud or blast furnace 6807.10 8% slag or one
or more of these materials have been used.
rate of duty for the aforesaid goods if it is classified under sub-heading No.6803.00
is at 18% and if it is classified under sub-heading No.6807.10, is at 8%.
No.6803.00 speaks of Slagwool, Rockwool and similar wools, whereas sub-heading No.6807.10
speaks of goods in which more than 25% by weight, red mud, press mud or blast furnace
slag or one or more of these materials is used.
No.6807.10 was introduced after the Budget of 1997.
period in question of this appeal is after 9th June, 1998.
R.P.Bhatt, learned senior counsel appearing for the revenue would submit that when
there is a specific heading/sub-heading wherein the goods, such as Slagwool,
Rockwool and similar wools are enumerated, that entry requires to be applied and
not the general entry or a residuary entry. Learned counsel also brings to our notice
about the Circular issued by the Central Board of Excise and Customs (for short
`the Board') dated 17.09.2001 to substantiate that the Board, after a detailed consideration
of the claim and the counter claim of the traders dealing in Rockwool and
Slagwool, has specifically classified that the aforesaid goods requires to be classified
under sub-heading No.6803.00 and not under sub-heading No.6807.10.
contra, Shri Alok Yadav, learned counsel appearing for the assessee, justifies
the impugned judgment and order passed by the Tribunal.
have already noticed the relevant entries to which we are concerned with in
this appeal. No doubt there is a specific entry which speaks of Slagwool and Rockwool
under Sub-heading No.6803.00, but there is yet another entry which is
consciously introduced by the Legislature under sub-heading No.6807.10, which speaks
of goods in which Rockwool, Slagwool and products thereof are manufactured by
use of more than 25% by weight of blast furnace slag. It is not in dispute that
the goods in question are those goods in which more than 25% by weight of one or
more of red mud, press mud or blast furnace slag is used. If that be the case,
then, in a classification dispute, an entry which is beneficial to the assessee
requires to be applied and the same has been done by the adjudicating authority,
which has been confirmed by the Tribunal. Alternatively, it can be said that
Sub-heading No.6807 is specific to the goods in which more than 25% by weight,
red mud, press mud or blast furnace slag is used. The heading is based entirely
on material used on composition of goods. A tariff heading, based on
composition of goods, is also specific heading like a heading based on commercial
nomenclature. Therefore, we are of the view that the goods in issue are appropriately
classifiable under Sub-heading No.6807.10 of the tariff entry.
learned senior counsel Shri Bhatt invites our attention to the circular
instructions issued by the Board. In our view, the departmental circulars are not
binding on assesee or quasi judicial authorities or courts and therefore, in that
view of the matter, the circular/ instructions issued by the Board, would not
may also notice that the Full Bench of the Tribunal in the case of Commissioner
of Central Excise, Raipur Vs. Punj Star Insulation Fibre Co. has taken a view that
the slagwool and rockwool would fall under sub-heading No.6807.10 and not under
sub-heading No.6803.00. The judgment of the Tribunal has attained finality,
since the revenue has not questioned the same before the appropriate forum. This
fact has been noticed by this Court while disposing of Civil Appeal Nos.60-61
of 2003 in the case of M/s.Rockwool (India) Pvt. Ltd. Vs. Commissioner of Customs
& Central Excise, Hyderabad decided on 07.05.2008.
view of the above, we are of the opinion that the Tribunal has not committed any
error, whatsoever, which would call for our interference. Accordingly, the
appeal is dismissed.C.A.Nos.2504-2505/2004: These appeals are also disposed of,
in terms of the observations and directions made by us today in the aforesaid order
(ANIL R. DAVE)