N.K. Bajpai, Member (T)

1. These three appeals and the Cross Objection were heard together because they involve a common question viz., Classification of prepregs P, F & G under the erstwhile Central Excise Tariff during the period 1984 onwards. While the first two appeals viz., E/814/86-C and E/1462/86-C have been filed by the department against the order-in-appeal passed by the Collector (Appeals) deciding the Classification in favour of M/s. Banlite Hylam (BH for short), the third appeal has been filed by M/s. BH against the order-in-appeal passed subsequently taking a different view from that in the first two appeals. Collector (Appeals) did so because, by the time the third appeal came to be decided, the Tribunal had taken a decision classifying Prepregs 'P' under tariff item 17(2), Prepreg 'F' under 19-III and Prepreg 'G' under item 22F in their own case Bakelite Hylam v. Collector of Central Excise MANU/CE/0056/1986 decided on 25.3.1986. The three appeals are, therefore, being disposed of by us by a common order.

2. It is necessary to state the background in some detail. The relevant facts are that M/s. BH are manufacturers of laminated boards and sheets called Deco-lam and Hylam etc., which were classified under Tariff Item 15A(2) till early 1984. They filed Classification List No. 9/84 on April 28, 1984, seeking approval of laminates boards and sheets under item 68. By another Classification List No. 10/84 filed on June 22, 1984, they sought approval of Pre-preg 'P' i.e., synthetic resin impregnated paper; Pre-preg 'F' i.e., synthetic resin impregnated cotton fabrics; and Pre-preg G' i.e., synthetic resin impregnated glass fabric under Tariff Item 68. The decision to seek revision of the classification was the pronouncement of the Supreme Court in the case of Geep Flashlight Industries v. Union of India and Ors. that Tariff Item 15A(2) covers only articles made wholly of commodity commercially known as plastics and not articles made from plastics along with other materials.

3. The Assistant Collector Central Excise, Hyderabad-II Division issued a Show Cause Notice to BH on 28 July, 1984 asking them to show cause why the classification of laminated boards and sheets should not be made under item 15A(2) and of Pre-pregs 'P' 'F' and 'G' should not be done respectively under items 17(1) as converted or impregnated paper, under Item 19(111) as impregnated cotton fabrics and under item 22(B) as impregnated textiles fabrics. M/s. BH contested the proceedings and submitted that the classification claimed by them in the two Classification Lists viz., 9/84 and 10/84 should be approved. The following paragraphs from their reply dated 6 February, 1984 are relevant:

As far as Laminates are concerned they are composites consisting of paper/fabric and synthetic resins. Paper/Fabric predominated by weight as well as by volume in the Laminate. The Laminate is a product in which neither the identity of paper/fabric or synthetic resin is distinguishable. The Laminate is neither paper/fabric nor plastic but 'laminate' as commonly known. In fact in the trade with customers, the product is better known as Decolam and Hylam Laminates. It is not known either technically or in common parlance as plastic. The product does not fall under Tariff Item I5A which deals with Artificial or Synthetic resins and Plastic materials etc. The various articles referred to in Tariff Item 15A all have the specific properties attributes to plastic. Therefore, Decolam and Hylam Laminates cannot be considered as falling under Tariff Item 15A.

As regards Classification of Prepregs we submit that the burden of the submissions made under Laminate hold good for Pre-pregs also. The test to determine the correct classification for the product has been laid down in the Supreme Court Judgment in the case of Geep Flashlight Industries on Special Leave Petition No. 654/1983 : 1986 (6) ECr 430 (SC) : ECR C 753 SC. The Customs Excise Gold Control Appellate Tribunal, Special