K.L. Rekhi, Member (T)

1. The short point involved in this case is whether plastic sacks, known as high density polyethylene woven sacks, are classifiable under item 15A(2) of the Central Excise Tariff or under item 68 thereof.

2. The appellants were not present when the case was called for hearing today. Their letter dated 27-6-83 was brought to our notice in which the appellants have stated that their case may be decided on the basis of their submissions made in their revision application (now the subject appeal before us after its transfer to the Tribunal) since they were not in a position to attend the hearing. We, therefore, decided to take up the case on merits.

3. We find from the records that the appellants were called upon to pay an amount of Rs. 7,731.55, being the duty leviable on HDPE woven sacks during the period from 1-3-75 to 30-6-75 at the rate of 1% under item 68 CET. In addition, a penalty of Rs. 250.00 was also imposed on them under Rule 173-Q of the Central Excise Rules, 1944 for violation of the provisions of Rules 173-F and 173-G on the ground that they removed the goods without payment of duty during the aforesaid period. Before the Assistant Collector, the appellants defence was mainly two-fold-

(1) HDPE woven sacks fell under item 15A(2) and not under item 68, and

(2) in any case, they were entitled to complete exemption under item 68 by virtue of notification No. 54/75-C.E. as the number of workers engaged in their factory in each of the three shifts did not exceed 49.

On the first count, the Assistant Collector held against the appellants on the ground that the goods in this case were made out of HDPE woven fabric which was classifiable as an art silk fabric or man-made fabric under item 22, CET and that sacks made out of such fabric could not be classified under item 15A(2). The Appellate Collector agreed with the Assistant Collector on this count and observed that the CCCN classified plastic sacks as articles of textiles in Section XI thereof and not as articles of plastics under heading 39.07. However, the Appellate Collector remanded the case back to the Assistant Collector so far as the second ground urged by the appellants, namely, the applicability of notification No. 54/75-C.E. was concerned. The issue before us is, therefore, confined to ground No. 1, i.e., classification of the goods under the Central Excise Tariff.

4. During the hearing before us, the Department's representative reiterated the arguments relied on by the Assistant Collector and the Appellate Collector and quoted from the West Bengal Collectorate trade notice No. 81/82 dated 21-4-82 which was based on a Tariff Advice issued by the Central Board of Excise Customs. In response to a query from the Bench, she stated that she had no information regarding any fresh order passed by the Assistant Collector after remand of the matter to him by the Appellate Collector on the issue of applicability of notification No. 54/75-C.E.

5. We have carefully considered the matter. Tariff item 15A(2) at the material time read as under :-

"Articles made of plastics, all sorts, including tubes, rods, sheets, foils, sticks other rectangular or profile shapes, whether laminated or not, and whether rigid or flexible including lay flat tubings and polyvinyl chloride sheets, not otherwise specified."

The wording of the entry specified two conditions-

(1) the articles, in order to fall in the entry, should be made of plastics, and

(2) they should not be specified elsewhere in the Central Excise Tariff.

Subject to these two conditions, the scope of the entry was indeed very wide as is apparent from the words "all sorts" occurring therein. Further, the inclusive definition of the entry not only covered such obvious items as plastic drums, buckets, jars, mugs, combs etc., which were finished articles of plastics, but also other less obvious items like tubes, rods, sheets, foils etc. which may be supplied in length and may require further fabrication or cutting t