C.S. 199 of 1978 :This suit which was originally filed as O.S. No. 50 of 1978 on the file of the Subordinate Judge, Chingleput, had been ordered to be transferred to the file of this court by Natarajan J. as per the order dated 28-2-1978 made in Appln No. 810 of 1978. Accordingly the suit was withdrawn from the Subordinate Judge, Chingleput. and taken on the file of this court as C.S. No. 199 of 1978.

2.The plaint allegations are as follows - The plaintiff 'Light Roofing Ltd.', is a company incorporated under the Companies Act, 1956, having its registered office at No. 125, Lloyds Road, Madras 86, and its factory is situate at Chittipunyam village in Chingleput District.

3.The first defendant is the Assistant Collector of Central Excise, Vellore. The second defendant is the Superintendent of Central Excise, Kancheepuram and the third defendant is the Union of India, represented by the Secretary, Ministry of Finance, New Delhi.

4.The plaintiff had been manufacturing at its factory at Chettipuram village Chingleput district, asphalted roofing sheets (final product) for which the intermediate product is fibre mat. The factory has been in operation since 1969 and is working under l. 4 licence openly subject to excise supervision.

5.In the first stage of manufacture the plaintiff utilises the road picked waste paper, card board, craft paper, paper board, newsprint etc. which had been disposed of as waste. The plaintiff used to purchase these wastes from the contractors. These pickings so purchased are wetted and converted into pulp and thereafter made into sheets by rolling the same in the machine, then dried in sun and cut into requisite size. The sheet's normal size is 122 X 94 or 95 cm. and the weight thereof would be 1.6 kg. or 1.7 kg. At this stage the product is called 'fibre mat' but the authorities have been trying to term the same as 'mill board or paper board'.

6.The second stage is that this fibrous mat is wetted and corrugated by machine. In the corrugation, the length, 122 cm. would remain constant and the breadth of 94 or 95 cm. of the mat would get reduced to 72 cm. The corrugated sheet is then impregnated in hot liquified asphalt for 15 minutes and then dried and thereafter finished with aluminium paint. This finished prouct viz., the roofing sheet of standard size 122 x 72 cm. by this time weighs 3.4 to 3.5 kg. The asphalt which the plaintiff used is 80/100 grade of Indian Oil Corporation which is the same article used for paving the roads and this process hardens to some extent the mat. This changes the colour from grey into dark black and the corrugated sheets are still flexible. The weight of the mat being 1.6 to 1.7 kg. and the weight of the roofing sheet being 3.4 to 3.5 kg. an additional weight of about 1.8 kg. is accounted for .by the asphalt content. The asphalt content is, more than the fibre content in the roofing sheet. In other words, the roofing sheet contains about 53 per cent asphalt and 47 per cent the fibre mat; made from waste paper pulp. This type of roofing sheet is known in the international market as asphaltic roofing sheet. There are international standards for roofing sheets and the asphalt content is above 50 per cent in the roofing sheets.

7.By order dated 22-9-1975 the first defendant directed that the plaintiff should clear asphaltic roofing sheet on payment of duty under Tariff' item 17(4) of the Central Excises and Salt Act. By order dated 10-10-1975, the Appellate Collector set aside the order dated 22-9-1975 specifically on the ground that the plaintiff had no opportunity of presenting its case that the roofing sheet did not fall under item 17 at all and asking the first defendant to pass a regular appealable order after following the principles of natural justice, by issuing a show cause notice and giving a hearing to the plaintiff. The plaintiff also filed W.P. 6287 of 1975 before this court against the orders of the first defendant and since the appeal was allowed by the App