B.5 – Ranchi Zone – Classification – Classification of Silica Ramming Mass under Chapter Heading 3816 of CETA, 1985.
A large number of units situated in the jurisdiction of the zone are engaged in the process of crushing, screening, grinding and mixing of quartz / quartzite mineral stones (in boulder form) to convert them into quartz/ quartzite grains and powder, which is known in trade parlance as Silica Ramming Mass or Ramming Mass. The quartz/ quartzite mineral contain more than 95% of silica (up to 99.9%), hence the name. The quartz and quartzite minerals are not mixed with each other, since quartz mineral has higher silica content as compared to quartzite mineral. The assessees classify the aforesaid goods under chapter heading 2506 of CETA, whereas the zone is of the preliminary view that goods are more appropriately classifiable under Chapter heading 3816 of CETA in view of Chapter Note 1 of Chapter 25.
Discussion & Decision
The issue was deliberated in the Conference where, two heads of classification viz., CETH 2506 and 3816 were discussed in case of the product Ramming Mass of the kind obtained by crushing/grinding and mixing of quartz and quartzite minerals of different sizes and where no external binders are added to such mixture.
It was noted that explanatory notes to the HSN of Heading 3816 covers certain preparations (e.g. for furnace linings)…, with an added refractory binder …. Many of the products of this heading also contain non-refractory binders such as hydraulic binding agents, therefore, to qualify for classification under heading 3816, refractory binder is required to be added to such powdered/grained quartz/quartzite mixture. Since no refractory binder is added to the impugned product, the same is not covered under heading 3816. This view is reinforced by the Tribunal in the case of M/s Mayur Chemicals Industries [2001 (136) ELT 1389] upheld by the Hon’ble Supreme Court.
Chapter Note 1 of Chapter 25 is also relevant to this issue. Hon’ble CESTAT, in the matter of M/s 20 Microns Ltd. [2012-TIOL-1467-CESTAT-AHM] has held that specific heading has to be preferred to the general heading and Chapter 38 being a residual chapter, Chapter 25 is to be preferred. In this regard, para 10 of the CESTAT order is specifically relevant & may be referred where it has been explained that where no material of different composition is mixed, the exclusion clause of Note 1 of Chapter 25 does not apply. This view is reinforced by the observation of Hon’ble Supreme Court in the matter in the matter of M/s Deepak Agro Solutions Ltd. [2008-TIOL-98-SC-CUS]. Additionally, Rule 2(b) of the General Rules for Interpretation of Schedule provides that any reference to a given material or substance shall be taken to include a reference to goods wholly or partly of that substance. Accordingly, it was concluded that the impugned product, when not added with any external binder, shall be classified under Chapter heading 2506.