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474 EXCISE LAW TIMES [ Vol. 372

They may also be impregnated (e.g., with latex) or backed with woven
or non-woven fabrics or with cellular rubber or plastics.”
16. The said instrument, i.e. HSN Explanatory Notes deal with four en-
tries against Tariff Item No. 5703 in following terms :-
“57.03 - CARPETS AND OTHER TEXTILE FLOOR COVERINGS,
TUFTED, WHETHER OR NOT MADE UP.
5703.10 - Of wool or fine animal hair
5703.20 - Of nylon or other polyamides
5703.30 - Of other man-made textile materials
5703.90 - Of other textile materials
This heading covers tufted carpets and other tufted textile floor cover-
ings produced on tufting machines which, by means of a system of needles
and hooks, insert textile yarn into a pre-existing backing (usually a woven
fabric or a non-woven) thus producing loops, or, if the needles and hooks
are combined with a cutting device, tufts. The yarns forming the pile are
then normally fixed by a coating of rubber or plastics. Usually before the
coating is allowed to dry it is either covered by a secondary backing of
loosely woven textile material, e.g., jute, or by foamed rubber.
Products of this heading are distinguished from the tufted textile fab-
rics of heading 58.02 by, for example, their stiffness, thickness and strength,
which render them suitable for use as floor coverings.”
17. Learned Counsel for the revenue has argued, referring to three ear-
lier orders of the Customs Excise and Gold (Control) Appellate Tribunal
(CEGAT-the predecessor of CESTAT) and has also relied on a circular issued by
the excise authorities dated 17th April, 1995. The said circular (Bearing No.
117/28/95-CX) specifies :-
“Car Mattings made from non-woven materials in roll form -
Dutiability of
Circular No. 117/28/95-CX, dated 17-4-1995
[From F. No. 57/1/94-CX.1]
Government of India
Ministry of Finance (Department of Revenue)
New Delhi
Subject : Dutiability of Car Mattings made from non-woven materials in roll form
- Regarding
I am directed to refer to Board’s <<15391$Circular No. 5/Floor-
Coverings/87>> (F. No. 57/1/87-CX.1), dated 23-6-1987 wherein it was
clarified that duty liability would not be attracted on car mattings made
from duty paid non-woven material in roll form. It has been brought to the
notice of the Board that this position may not hold good after extension of
Modvat to these items.
2. The matter has been re-examined by the Board. The Board is of
the view that there are two clear stages i.e. non-woven material emerging as
excisable and dutiable goods in roll form and finally car mattings emerging
as different final products. Duty has to be charged at both stages as the pro-
cesses of conversion of non-woven material in roll form into car mattings
involves the processes of cutting, stitching, sizing etc., and both products
are known differently in the market.
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