Precious Industries Vs. Collector of Customs - Court Judgment

Excerpt:
1. since the issue involved is common, the above captioned 26 appeals are disposed of by a common consolidated order.2. the importers had imported consignments of electrical grade insulating paper and had claimed their assessment under heading 48 of the customs tariff act (cta), 1975 read with notification no. 37-cus., dated 1st march, 1978 and had also claimed the levy of additional duty of customs under tariff item 17(2) of the erstwhile central excise tariff (cet). a detailed chart as to the claim made by the importers and the assessment made by the revenue authorities is attached vide annexure 'a', explaining the stand taken by the importers before the department and the assessment made by the department under different heading/tariff item. since the facts of all the appeals are.....

Judgment:
1. Since the issue involved is common, the above captioned 26 appeals are disposed of by a common consolidated order.

2. The importers had imported consignments of electrical grade insulating paper and had claimed their assessment under Heading 48 of the Customs Tariff Act (CTA), 1975 read with Notification No. 37-Cus., dated 1st March, 1978 and had also claimed the levy of additional duty of Customs under Tariff Item 17(2) of the erstwhile Central Excise Tariff (CET). A detailed chart as to the claim made by the importers and the assessment made by the Revenue authorities is attached vide Annexure 'A', explaining the stand taken by the Importers before the Department and the assessment made by the Department under different heading/tariff item. Since the facts of all the appeals are similar, for the sake of brevity the facts in the case of Precious Industries v.C.C.,. Bombay (Appeal No.3. M/s. Precious Industries, Bombay had imported electrical grade insulating material as under :-Ex. ss. Hapag Lloyd Express B/E Cash No.(1) 1458 dated 4/6-9-1982 (2) 293/30-10-1982 The importers had made a claim of refund on the ground that the goods electrical grade insulating materials are chargeable to duty at the concessional rate in terms of Notification No. 37-Cus., dated 1st March, 1978. The goods imported were electrical grade insulating papers. These were high temperature resisting materials. The imported goods were in the nature of multilayer insulating materials made of various materials by glueing and that at least one of the layers is plastic sheet. The composite material in question has got essential characteristics of electrical insulation to the plastic portion rather than the paper backing. In the light of Rule 3(b) of the interpretation Rules, the composite insulation materials made up of plastic portion and papers were classifiable under Heading 39.01/06 of the Customs Tariff Act, 1975 and as the goods imported were assessable under Heading 39.01/06 the benefit of Notification No. 37/78-Cus., dated 1st March, 1978, which was applicable to the goods covered under Heading 48.01/21 was not available to the goods. The original assessment was in order. The claim was rejected. Being aggrieved from the aforesaid order, the appellants have filed appeals to the Collector of Customs (Appeals), Bombay and in the Memorandum of Appeal, it was claimed that the impugned goods were treated on laminated paper and that the mere fact that they were treated with oils, waxes and artificial resins does not change their character. Before the Collector of Customs (Appeals) it was contended that the goods should be reassessed under Heading 48.01/21 read with Notification No. 37/78-Cus., dated 1st March, 1978 or in the alternative the benefit of Notification No. 68/71 - C.E. for the purpose of levy of additional duty of customs may be given. The learned Collector of Customs (Appeals) did not accept the contention of the importers following Order No. 303/83-C of the CEGAT wherein after examining the goods and the technical evidence tendered in their regard, the CEGAT had arrived at the decision that in a composite material, the essential characteristics of 'E' class electrical insulation came from the plastic portion rather than the paper backing.

Citing Rule 3(b) of the rules for interpretation of the tariff, the Tribunal had held that the impugned goods merited classification under Heading 39.01/06 in preference to Chapter 48 of the Customs Tariff Act.

The learned Collector (Appeals) had further held that the imported goods were not entitled to the benefit of Notification No. 37/78-Cus., dated 1st March, 1978. On the alternative plea of the importers for the extension of the provisions of Notification No. 68/71, dated 25th May, 1971 as amended, he had followed a judgment of the Tribunal, where the Tribunal had observed that the goods by themselves were not paper or board nor an article of plastic, therefore, their classification either under Item 17 or 15A of the CET would be inappropriate. However, since the Central Excise Tariff had no rules of interpretation like Rule 3(b) of the CTA and the goods were composite material in which both the components are active components in the sense both the materials possess insulation properties, the appropriate Central Excise Tariff for the goods would be the residuary Item 68. He had upheld the classification of the impugned goods under Heading 39.01/06 of the CTA and for countervailing duty he had ordered the classification under Item 68 of the CET. Being aggrieved from the aforesaid order, the appellants have come in appeal before the Tribunal.

4. Notices of hearing were sent to all the parties. Shri S.D. Nankani, the learned Advocate had appeared on behalf of the importers. No other importer had appeared. Shri S.D. Nankani, the learned Advocate who had appeared on behalf of M/s. Precious Industries on 19th and 20th December, 1988 had argued the matter but due to change in the constitution of the Bench the judgment could not be released.

Accordingly fresh notices of hearing were sent to the parties. Nobody has appeared on behalf of the importers. Shri S.D. Nankani, the learned Advocate vide his letter dated 18th April, 1989 received in the Registry on 24th April, 1989 had intimated that the appeals may be decided on the basis of the submissions already made.

5. Shri A.S. Sunder Rajan, the learned JDR who has appeared on behalf of the Revenue has reiterated the facts. He has referred to the following orders passed by the Tribunal :- (a) Order No. 303/83-C, dated 24-6-1983 reported in 1987 (31) E.L.T. 73 (Tribunal) - Collector of Customs, Bombay v. Yash Udyog, SawantwadiSunrise Electricals v. Collector of CustomsM.C. Mody & Bros.

v. C.C., Bombay (d) Order No. C-371/85, dated 15/18-5-1985 - Solar Elec. Trading Co.

v. C.C., Bombay (e) Order Nos. C-372 to 377/85, dated 18-5-1985 - Sunrise Elec.

Corporation. v. C.C., Bombay (f) 1986 (24) E.L.T. 542 - Guardian Plasticote Ltd. v. C.C.E., CalcuttaC.C.E., Hyderabad v. Uma Laminated Products P. Ltd. (h) Order No. 826/85-C - Crompton Greaves Ltd. v. C.C., Bombay (i) Order No. 42 to 49/85(D), dated 13th Feb., 1985 - Raja Radios Co., Bombay v. C.C., Bombay 6. Shri A.S. Sunder Rajan, the learned JDR has stated that in the case of Yash Udyog [1987 (31) E.L.T. 73 (Tribunal)] the Revenue had filed an appeal before the Hon'ble Supreme Court and the same was dismissed being hit by limitation and against the Order Nos. 537-539/83-C (Sunrise Electrical v. CC, Bombay) 1983 E.L.T. 2465 the Revenue had filed appeals before the Supreme Court and the same are pending and in the appeal before the Supreme Court only the countervailing duty has been challenged and in Order No. 301/1985-C, dated 16th April, 1985 in the case of Mody & Bros. v. CC, Bombay, appeal has been filed before the Hon'ble Supreme Court and the same is pending. Shri Sunder Rajan, the learned JDR has stated that since the appeals are pending before the Supreme Court, judicial propriety requires that the appeals should be kept pending till the disposal of the appeals by the Hon'ble Supreme Court. Shri Sunder Rajan, the learned JDR has referred to an order of the Tribunal in the case of Solar Elec. Trading Co. v. CC, Bombay (No.C-371/85, dated 15/18-5-1985), which appears on page 133 of the paper book filed by the importers and has laid special emphasis on page 141 of the paper book, where the Tribunal has observed that Tariff Item No.15A covers artificial or synthetic resins and plastic materials. Item No. 17 covers paper and paper board. These goods are made of paper and polyester film laminate and are used as insulating materials. We have said above that both plastic and paper are good electrical insulating substances. Both resist the passage of electricity and both, in their own rights, are knwon and are used as electrical insulating material and both are equally good. Plastics may have the advantage of greater strength and better tolerance of high temperature but as far as electrical non-conductivity is concerned the two are equal in performance. When they are used together, one complements and supplements the other to increase the utility of the composite in a synergistic total. But it is impossible to say which is the dominant component in electrical insulation. It may be possible in a laboratory to determine this by subjecting the two constituents of the insulating grade paper to a thorough physical test. Such a test was not done and so we can safely say that the two partners make equal contribution as indeed well they could. Neither party to this dispute has proved one component was more resistant electrically than the other. Shri A.S.Sunder Rajan, the learned JDR has again referred to the judgment in the case of Guardian Plasticote Ltd. v. CCE, Calcutta reported in 1986 (24) E.L.T. 542. He has laid special emphasis on para number 9 of the said judgment. Shri Sunder Rajan states that the assessment under Tariff Item 15A(2) for the purpose of CV duty is not pressed by the Revenue.

The Revenue wants assessment under Tariff Item 17(2). He has further stated that the findings in the Yash Udyog has attained finality and it is not open to the Tribunal to come to a different conclusion. Shri Sunder Rajan has argued that the Revenue's appeals are only on countervailing duty and that the Revenue wants the assessment for the purpose of CV duty under Tariff Item 17(2) though the Revenue had made a claim under Tariff Item 15A vide the Memorandum of appeal filed by the Department. Shri Sunder Rajan states that the importers also want assessment under Item 17(2) of the Central Excise Tariff. Shri Sunder Rajan has again referred to the judgment of the Tribunal in the case of Raja Radios Co., Bombay v. Collector of Customs, Bombay (Order No. 42 to 49/85(D), dated 13th February, 1985, where the Tribunal had held the classification of the subject goods under Heading 39.01/06 CTA and CV duty was held to be classifiable under Tariff Item 68 of the CET. Shri Sunder Rajan has pleaded for the acceptance of the appeals filed by the revenue and has pleaded for the rejection of the appeals filed by the importers.

7. Shri S.D. Nankani, the learned Advocate who has appeared on behalf of the importers has pleaded that the importers had imported electrical grade insulating paper and the description of the imported goods as per Bill of Entry and invoice, which appear on 129 to 131 of the importers' paper book, is "Electrical Grade Insulating Paper Printed in sheet OFN 600 mm x 800 mm 'TRIVOLTON' HP - 2520". He has referred to Indian Standard (IS : 1271-1958) which relates to classification of insulating materials for electrical machinery and apparatus in relation to their thermal stability in service and he has laid special emphasis on para 2.2.1 which says that in each class, a proportion of materials of a lower temperature class may be included for structural purposes only, provided that adequate electrical and mechanical properties are maintained during the application of the maximum permitted temperature.

Shri S.D. Nankani, the learned Advocate states that in view of the position explained by him the imported goods merit classification under Chapter 48 and not under Ch. 39 of the CTA. The goods imported is paper laminated with polyester. He has again referred to internal page 11 of 15: 1271-1958 and has stated that 'V Class principal is paper and paper products and 'E' class subsidiary is Paper laminates, Cellulose triacetate film & Polyethylene terophthalate film. Shri Nankani, the learned Advocate has also again referred to the grouping of the insulation into class 'V, 'A', 'E', 'F, 'H' and 'C as per internal pages 7 & 8 of the IS : 1271-1958 and has laid special emphasis on class 'E' which reads "insulation consists of materials or combination or materials which by experience or accepted tests can be shown to be capable of operation at Class E temperatures (materials possessing a degree of thermal stability allowing them to be operated at a temperature 15 Centigrade degrees higher than Class A materials). He has referred to unamended and amended Interpretatory Rules to the Customs Tariff Act as per Schedule I which appears on pages 41 to 43 of the paper book. Shri Nankani has argued that as per unamended Interpretatory Rule 3(c) "when goods cannot be classified by reference to (a) or (b), they shall be classified under the heading which involves the highest rate of duty", whereas after the amendment of the Interpretatory Rules which came into effect from 1st September, 1978 Rule 3(c) provided that "when goods cannot be classified by reference to (a) or (b), they shall be classified under the Heading which occurs latest among those which equally merit consideration." Shri Nankani stated that polyester coating did not give any property of insulation.

The property of insulation was already there. Polyester coating increases the insulation property and also increases its life. Shri Nankani states that in terms of Rule 3(b) of the Interpretatory Rules which reads "mixtures and composite goods which consist of different material or are made up of different components and which cannot be classified by reference to (a) shall be classified as if they consisted of the material or component which gives the goods their essential character, insofar as this criterion is applicable". He has referred to Order No. C-372 to 377/85, dated 18-5-1985 in the case of Sunrise Elec.

Corporation where two members had taken the view that Interpretatory Rule 3(c) is applicable and one member had taken the view that Interpretatory Rule 3(b) is applicable. He has also referred to Interpretatory Rule 4 which relates to "goods not falling within any Heading of the Schedule shall be classified under the Heading appropriate to the goods to which they are most akin." He has referred to a decision of the Larger Bench of the Tribunal in the case of Guardian Plasticote Ltd. v. CCE, Calcutta reported in 1986 (24) E.L.T.542 where the Tribunal had held that on subjecting kraft paper to the process of lamination by laminating two layers of kraft paper with polythene, a new and distinctive commodity had emerged and the product would merit classification under Tariff Item 17. He has referred to Notification No. 37/78-Cus., dated 1-3-1978 as amended by Notification No. 179/78-Cus. Shri Nankani has stated that both the sides now want the assessment under Tariff Item 17(2) for the purpose of CV duty. Shri Nankani states that the importers want the classification under Heading 48 of the Customs Tariff Act. He has also referred to a judgment in the case of Entremonde Polycoaters Pvt. Ltd., Nasik v. CCE, Pune reported in 1984 (16) E.L.T. 389 (Tribunal) and has laid special emphasis on para numbers 10 & 11 of the said judgment where the Tribunal had held that the duty was paid originally as printing and writing paper under 17(1) and after the process it has shifted from one duty zone viz., 17(1) to 17(2) of the CET. Shri Nankani has referred to the judgment of the Tribunal in the case of Solar Electric Trading Co. v. Collector of Customs, Bombay vide Order No. C-371/85, dated 15th May, 1985 and in particular internal page 3 of the said order appearing on page 137 of the paper book. He has also again referred to the Bill of Entry which appears on page 131 of the paper book and states that the importers had claimed the assessment under Heading 4811.31. Shri Nankani pleads that the assessment may be made under Chapter 48 of the Customs Tariff Act, 1975 and for the purpose of countervailing duty, duty be levied under Item 17(2) of the CET.8. Shri A.S. Sunder Rajan, the learned JDR stated that the revenue had filed cross-objections and delay in the filing of the same may be condoned as the Revenue was prevented by sufficient cause in the late filing of the same. He further stated that the only issue in the cross-objection is as to the levy of the CV duty. Shri Nankani, the learned Advocate on the aspect of condonation of delay opposes but leaves it to the discretion of the Bench.

9. Shri Sunder Rajan, the learned JDR has in reply referred to the Interpretatory Rules. Shri Sunder Rajan states that nobody has challenged the judgment in the case of Yash Udyog. The Tribunal in all its decisions after the 1978 amendment has held that Interpretatory Rule 3(b) is applicable and Interpretatory Rule 3(c) has been applied by the Tribunal only in the cases prior to 1978. Shri Sunder Rajan states that all the importations in the matters before the Tribunal are after 1978 and as such Interpretatory Rule 3(b) is applicable. Shri Sunder Rajan has pleaded for the acceptance of the Revenue's appeals.

10. We have heard both the sides and have gone through the facts and circumstances of the case. For the proper appreciation of the classification aspect Heading Numbers 48 and 39 are reproduced below :---------------------------------------------------------------------------------Head- Sub-heading No. and description Rate of duty (a) Stan- Central Exciseing of article dard (b) Preferential Tariff ItemNo. areas--------------------------------------------------------------------------------(1) (2) (3) (4)--------------------------------------------------------------------------------48.01/ Paper and paper board, all sorts, 16B 1721 whether in rolls, sheets or cut (2) Newsprint containing (a) 40% plus Rs. mechanical wood pulp amounting 1000 per tonne to not less than 70 per cent of the (3) Other printing and writing (a) 60% paper39.01/ Condensation, pplycondensation (a) 200% 15A, 15B, 16B06 and polyaddition products,39.07 Articles of the materials des- (a) 100% 15A, 15B, 16B cribed in Heading No. 39.01/06 11. Explanatory Notes to the Brussels Nomenclature : Vol. 2, appearing on pages 45 to 47 of the paper book, are also reproduced below :- Paper and Paperboard; Articles of Paper Pulp, of Paper or of Paperboard (I) Paper and paperboard (including cellulose wadding) of all kinds, in rolls or sheets: (B) Headings 48.03 to 48.07 relate to certain special papers and paper-boards (parchment, greaseproof, composite) and those which have been subjected to various treatments, such as coating, design printing, ruling, impregnating, corrugation, crepting, embossing and perforation.

When paper or paperboard answers to a description in two or more of the above-mentioned headings it is classified in that heading which is latest in the nomenclature.

It should also be noted that Headings 48.01 to 48.07 apply only to papers, paperboards or cellulose wadding which are : (1) In strips or rolls of a width exceeding 15 cm.* * * * * * 48.07 - Paper and Paperboard, impregnated, coated, surface-coloured, surface-decorated or printed (Not constituting printed matter within Chapter 49), in rolls or sheets.

With the exceptions referred to at the end of this Explanatory Note, this heading applies to the following paper and paperboard in rolls or sheets: (A) Paper and paperboard to which superficial coatings or layers of other materials have been applied to the whole or part of one or both surfaces.

(B) Paper and paperboard printed or coloured on the surface with a single colour or with different colours, including surface marbled and design printed paper, and paper with printed characters, devices or pictures merely incidental to their use as paper and not constituting printed matter falling with Chapter 49 (See Note 8 to Chapter 48).

Most of these papers and paperboards are obtained by treatment with oils, waxes, artificial resins, etc. in such a manner as to permeate them and give them special qualities (e.g. to render them waterproof, greaseproof, and sometimes translucent or transparent).

They are used largely for protective wrapping and as insulating materials.

Oiled wrapping paper; oiled or waxed manifold paper; stencil paper; certain tracing papers; indicator papers such as litmus and pole-finding papers; insulating paper and paperboard impregnated, e.g. with artificial resins; rubberised paper; paper and paperboard merely impregnated with tar or bitumen." 12. We have perused the tariff headings. For coming to the correct classification we have to resort to Interpretatory Rules.

Interpretatory Rules (3) and (4) to the First Schedule to the Customs Tariff Act, 1975 are reproduced below :- "3. When for any reason, goods are, prima facie, classifiable under two or more Headings, classification shall be effected as follows: (a) The Heading which provides the most specific description shall be preferred to Headings providing a more general description.

(b) Mixtures and composite goods which consist of different material or are made up of different components and which cannot be classified by reference to (a) shall be classified as if they consisted of the material or component which gives the goods their essential character, insofar as this criterion is applicable.

(c) When goods cannot be classified by reference to (a) or (b), they shall be classified under the Heading which occurs latest among those which equally merit consideration.

4. Goods not falling within any Heading of the Schedule shall be classified under the Heading appropriate to the goods to which they are most akin." 13. A simple reading of the Interpretatory Rule 3(b) shows that the complete article may, as in this case, be made up of two materials, both of which have like functions, but one of which possesses the essential quality in a much higher degree than the other.

Interpretative Rule 3(b) plainly means that in such a case it is the second material which gives to the composite article its essential character. In the matter before us the appellants had imported paper and it contains ten mil. of paper and 1 mil. of plastic. The learned Advocate for the importers had vehemently argued that the classification should be made on the basis of the predominant content and it should govern the classification as the paper itself has got insulation properly and the plastic portion further increases its insulation. Rule 3(b) required consideration of the question as to which material gave the essential character to the goods and not which material was predominant. In this case it was not the bulk of paper portion but the plastic portion which gave the product its essential character of higher degree of insulation. Accordingly Interpretative Rule 3(b) is applicable. The Tribunal had occasion to deal at length the same issue in the various judgments cited by both the sides in defence as well as against them. In the case, of Sunrise Electric Corporation reported in 1983 ECR 1762D it was held by the Tribunal that the imported goods were classifiable under Heading 39.01/06 CTA, 1975 for the levy of Basic Customs Duty.

14. The Australian Tribunal in the case of 1977 (2) ALD 84 had held as under:-Extract taken from Customs, Levy, Valuation & Classification by Shri V J. Taraporevala (1988 Edition) Page 232 is reproduced below:- "(6) C imported plastic food and drink coolers. They comprised four components - an outer plastic exterior, an inner lining, polyurethane foam filling between the exterior and the lining and a metal handle. They were held to be a single entity as they were imported as coolers and could not be considered as consisting of separate components. The general tariff head 'containers' applied to the goods. But 'containers' take many forms and descriptions.

Therefore, the sub-item which applied was the one that covered coolers. For it was the polyurethane filling that enabled the coolers to perform the function of keeping goods cool and that characteristic imparted the essential character to the goods. It is its essential character as a cooler which was relevant and accordingly the appropriate entry referring to coolers should be applied." 15. Accordingly, we rule out the classification under Heading 48 and hold that the goods are classifiable under Heading 39.01/06 of the CTA, 1975 for the levy of basic customs duty.

16. Now coming to the countervailing duty we would like to observe that the importers' claim was under Tariff Item 17(2) of the CET whereas the Revenue had assessed the same under Tariff Item 15A(2) except in Appeal Nos. CD/SB/1109/84-C and C-1795/85-C in the case of CC, Bombay v.Shashi Electricals and Shashi Electricals v. CC Bombay where the same was assessed under Tariff Item 68. The Revenue in the proceedings before the Tribunal had claimed assessment under Tariff Item 15A(2) and the importers all along had claimed the levy of CV Duty under Tariff Item 17(2) of the CET. During the course of arguments Shri A.S. Sunder Rajan, the learned JDR had pleaded that though the Revenue had made a claim under Tariff Item 15A(2) of the CET but he does not press the same and pleads that the CV duty may be levied on the imported goods under Tariff Item 17(2). In essence the Revenue as well as the importers want assessment under TI 17(2) for the purpose of CV duty. In the foregoing paras we have held that the goods do not fall under Chapter 48 of the Customs Tariff Act and as such they are not entitled to the benefit of exemption Notification No. 37/78-Cus., dated 1st March, 1978. We are also reproducing Tariff Items 17 and 15A of the Central Excise Tariff:-"Item No. 17 - PAPER AND PAPER BOARD AND ARTICLES THEREOF--------------------------------------------------------------------------------Item Tariff Description Rate of dutyNo.--------------------------------------------------------------------------------(1) (2) (3)--------------------------------------------------------------------------------17. Paper and Paper Board, all sorts (including paste-board, millboard, strawboard, cardboard (1) Paper and paper board, (including paper or paper Ten per cent ad boards which have been subjected to various treatments valorem plus two such as coating, impregnating, corrugation, creping thousand and five and design printing), not elsewhere specified.

hundred rupees per metric tonne.

(including flattened or folded boxes and flattened or per cent ad valorem.

folded cartons), whether or not printed and whether in assembled or unassembled condition."--------------------------------------------------------------------------------"Item No. 15A - PLASTICS--------------------------------------------------------------------------------Item Tariff description Rate of dutyNo.--------------------------------------------------------------------------------(1) (2) (3)--------------------------------------------------------------------------------15A. Artificial or synthetic resins and plastic materials; and other materials and articles specified below- products, whether or not modified or polymerised, and whether or not linear (for example, pheno-plasts, amino-plasts, alkyds, polyallyl esters and other unsaturated polyesters, silicones); polymerisation and co-polymerisation products (for example, polyethylene, polytetra-haloethylenes, polyiso-butylene, polystyrene, polyvinyl chlordide, polyvinyl chloroacetate and other polyvinyl derivatives, potyacrylic and polymethacrylic derivatives, coumaroneindene resins); regenerated cellulose; cellulose nitrate, cellulose acetate and other cellulose esters, cellulose ethers and other chemical derivatives of cellulose, celluloid); vulcanised fibre; hardened proteins (for example, hardened casein and hardened gelatin); natural resins modified by fusion (run gums; artificial resins obtained by esterification of natural resins or of resinic acids (ester gums); chemical derivatives of natural rubber (for example, chlorinated rubber, rubber hydrochloride, oxidised rubber, cyclised rubber); other high polymers, artificial resins and artificial plastic materials, including alginic acid, its salts and esters; linoxyn.

(2) Articles of materials described in sub-item (1), the following, namely: - Boards, sheeting, sheets and films, whether lacquered or Fifty per cent ad metallised or laminated or not; lay flat tubings not con- valorem. taming any textile materials.

(3) Polyurethane foam Seventy-five per cent ad valorem.

Explanation II. - In sub-item (1), "condensation, polycondensation polyaddition, polymerisation and co-polymerisation products" are to be taken to apply only to goods of a kind produced by chemical synthesis answering to one of the following descriptions: (c) resols, liquid polyisobutylene, and similar artificial polycondensation or polymerisation products.

Explanation III. - Sub-item (1) is to be taken to apply to materials in the following forms only:- (b) blocks, lumps, powders (including moulding powders), granules, flakes and similar bulk forms; -------------------------------------------------------------------- ------------ 17. We have already held that Interpretatory Rule 3(b) is applicable and the goods are composite material in which both the components are active components in the sense that both possess insulation properties, the appropriate Central Excise Tariff for the goods would be the residuary Item 68. Accordingly we hold that countervailing duty has to be charged under Tariff Item 68 of the Central Excise Tariff.

18. In the result, all the 26 appeals filed by the Revenue as well as the Importers are dismissed.

19. During the course of arguments, Shri Sunder Rajan, the learned JDR had made a prayer for condonation of delay in the filing of the cross objections and Shri Nankani, the learned Advocate had left it to the discretion of the Bench. The only prayer in the cross objections was in respect of the C V duty. In view of the submissions of both the sides on the prayer for condonation of delay and both the sides pray that CV duty be levied under Tariff Item 17(2) of the CET, we condone the delay in the filing of the cross objections. In the foregoing paras since we have held that CV duty has to be levied under Tariff Item 68 of the CET, the cross-objections are also dismissed.