COMMNR. OF CENTRAL EXCISE, BHOPAL Vs MINWOOL ROCK FIBRES LTD.
Bench: H.L. DATTU,ANIL R. DAVE
Case number: C.A. No.-004988-004988 / 2003
Diary number: 11767 / 2003
Advocates: ANIL KATIYAR Vs
M. P. DEVANATH
IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.4988 OF 2003
COMMNR.OF CENTRAL EXCISE, BHOPAL ... APPELLANT
VERSUS
MINWOOL ROCK FIBRES LTD. ... RESPONDENT
WITH
CIVIL APPEAL NOS.2504-2505 OF 2004
O R D E R
C.A.No.4988/2003:
1. This 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 No.6803.00.
2. The 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.
3. A 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.
4. The 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.
5. The 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
present appeal.
6. We 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 No.
(1)
Sub- Heading No.
(2)
Description of Goods
(3)
Rate of Duty
(4)
6803 6803.00 Slagwool, Rockwool and similar wools
18%
6807 68.07
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, all other articles of stone, plaster, cement, asbestos, mica or of similar materials, not elsewhere specified or included.
6807.10
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.
8%
7. The 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%.
8. Sub-heading 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.
9. Sub-heading No.6807.10 was introduced after the
Budget of 1997.
10. The period in question of this appeal is after
9th June, 1998.
11. Shri 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.
12. Per contra, Shri Alok Yadav, learned counsel
appearing for the assessee, justifies the impugned
judgment and order passed by the Tribunal.
13. We 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.
14. The 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 assist
them.
15. We 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.
16. In 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 i.e.
C.A.No.4988/2003.
Ordered accordingly.
...................J. (H.L. DATTU)
...................J. (ANIL R. DAVE)
NEW DELHI; FEBRUARY 02, 2012