S. Duggal, Member (J)

1. The subject-matter of imports in all these appeals is an item described uniformly as : 'Silicon Power Transistor chips' in specified number of pieces. These were assessed to duty, at the time of respective clearance, under T.I. 85.18/27(1) of the CTA on the view that they fall within the category of : 'Diodes, Transistor and similar semi-conductor devices'. Appellants' claim for refund of duty, seeking re-assessment of the goods under Chapter 38.01/19 of the CTA or, alternatively, for benefit of Notification No. l72/77-Cus assuming that the goods were classifiable under TI 85.18/27(1) CTA, was rejected on the view that, having regard to the wording of Section Note 2(s) to Chapter 38 (Section VI), read in conjunction with Note 5 to Chapter 85, the goods imported in a given number of pieces and described as 'Silicon Power Transistor Chips' would stand excluded from the category of 'miscellaneous and chemical products' as they have acquired the essential characteristics of a 'semi-conductor device, and that the entry under Sub-Heading 85.18/27(1) was wide enough to cover these type of 'diffused chips' of silicon because of the expression employed; namely, 'similar semiconductor devices'.

2. Appeals, taken to the Appellate Collector of Customs, against the individual orders of rejection of refund applications, were also rejected on the same view by means of impugned orders, listed above. Barring the last case (of Appeal No. C/2324/83-B.2), all the previous orders were passed by the same Appellate Collector holding that goods having been once treated as 'semi conductor devices', they stand excluded from the ambit of Notification No. l72/77-Cus. However, the Collector of Customs (Appeals), Madras in the last-mentioned case, dealt with an additional argument advanced on behalf of the appellants; namely that Notification No. 30/81 dated 1-3-1981 indicated, vide column 3 against Serial No. 7, that silicon in all forms, excluding 'Silicon diffused chips', have been given a concessional rate of duty and the description of goods has been correlated, vide column-2, with Chapter 38 of the CTA. It seems to have been argued that this indicated the intention of the legislature to have treated 'diffused silicon chips' to be falling under Chapter 38. This line of argument was rejected by the Collector of Customs (Appeals), holding that mere exclusion-clause in a notification did not determine the classification of an item under a specified chapter. Order-in-Appeal in all the cases also has reference to Explanatory Note to CCCN under Heading 85.21, which has been shown to be including : 'Transistor and similar conductor devices'.

3. The appellants assail the finding of the authorities below in this set of appeals on identical grounds. After explaining the meaning of expression 'semi conductor devices', it is pleaded that 'Silicon Chips' and when imported, had merely acquired a shape, which represents one of the individual circuits of a 'wafer'. It is asserted that these 'chips', by themselves, have not acquired the character of a finished product known as 'semiconductor device1, as known commercially and in common parlance, but furnish only a raw material on which a number of processes - of varying degree and character - are carried out and it is only those post-importation processes which impart the character of 'semi conductivity to these chips.

4. It is further explained that 'silicon chips' or 'wafers', in the original form of purity, are not in a position to conduct electricity which is the ultimate operational requisite for their being used as 'semi conductors' and, thus, it becomes technically necessary first to dope them by an element known as 'dopant', which process alters the conductivity of the 'silicon 'wafer'. But, in order to invest it with the properties of semi-conduction, a further process, which the appellants describe as "secondary process", known as : 'diffusion', by introducing some minute amounts of