Circular No. 161/72/95-CX dated 13/12/95
Subject: CE -Classification of PVC leather cloth or rexine cloth -
Clarification regarding
I am directed to say that doubts have been expressed regarding correct
classification of PVC leather cloth also known as Rexine Cloth as to whether it will
fall under Heading No. 39.21 or 59.03 of the Central Excise Tariff. Attention has been
drawn to Section Note l(d) of Section XI of Central Excise Tariff, Chapter Note 2(a)
(5) of Chapter 59 and Chapter note 2(k) of Chapter 39.
2. The process of manufacture of PVC leather cloth involves coating of a paste of
plastic material (PVC) on one side of the base fabric. In-this case the plastic is not
combined with the textile but is coated on textile fabric to form final product.
Textile fabric does not act as reinforcing material. Such fabrics are used for
upholstery and can take sharp bends without cracking.
3. As per Chapter Note 2(a) of chapter 59 of the Central Excise Tariff, Heading 59.03
applies to Textile fabrics, impregnated, coated, covered or laminated.with plastics,
whatever the weight per sq mtr. and whatever the nature of plastic materials other
than the following :-
(i) . . . . . . .
(ii) Products which cannot, without fracturing be bent manually around a
cylinder of a diameter of 7 mm at a temperature between 15 degree C and
30 degree C (Usually Ch.39) :
(iii) Products in which the textile fabric is either completely embedded in
plastics or entirely coated or covered on both sides with such
material......... (Chapter 39).
(iv) ................
(v) Plates, sheets or strips of Cellular Plastics, combined with textile
fabrics where textile material is present merely for reinforcing purpose
(Chapter 39).
4. Since these fabrics can take sharp bends without cracking, they cannot be included
in clause (ii) above. The coating is done on one side only and fabric is not
completely embedded in plastic material and.therefore, it is not covered by clause
(iii) above. In Rexine Cloth, plastic material is coated on a fabric base. Fabric does
not act as a reinforcing material and therefore Rexine Cloth is not covered by clause
(v). Therefore classification of PVC coated fabric, which in trade parlance is known
as leather cloth (and popularly known as rexine cloth). under Heading 59.03 is not hit
by the exclusions under Chapter Notp 2(a) of Chapter 59 of the Central Excise Tariff.
5. Section Note 1(d) of Section XI excludes fabrics impregnated, coated in laminated
with plastics of Chapter 39 from the purview of Section XI. Similarly Chapter Note
2(k) under Chapter 39 of the CET excludes Textiles and Textile Materials from purview
of Chapter 39. Both these notes read in conjunction do not provide any basis for
rejecting classification of Rexine Cloth either under Chapter 39 or under Textile and
Textile Articles.
6. HSN contains expanded meaning of items covered under Heading 39.21. It covers
plates, sheets, film, foil and strip of cellular plastics or those which have been,
reinforced, laminated, supported or similarly combined. Rexine Cloth does not meet any
of the criterion and does not appear to be covered by heading 39.21.
7. In contrast, the detailed notes on Page 816 of the HSN Explanatory Notes •clearly
amplify that leather cloth is covered by Heading 59.03. The relevant extracts are :-
"In many of the textile fabrics classified here, the plastic matericil usually
coloured, forms a surface layer which may be smooth or bv embossed to simulate,
e.g. the grain of leather ("leather cloth")."
"The fabrics of this heading are used for a variety of purposes including
furnishing materials, the manufacture of handbags and travel goods, garments,
slippers, toys etc. in book binding, as adhesive tapes, in the manufacture of
electrical equipment etc."
8. The Board has also taken note of the decision of the Tariff Conference of
Commissioners, of Customs held at Madras in the year 1990. The Conference had decided
that normally the PVC leather cloth is not made of textiles and plastic material in
combination and the plastic material is impregnated or coated on the fabric and they
are not hit by Chapter Note 2(5) to Chapter 59 aftd are correctly classifiable under
Heading 59.03 of the Custoirs Tariff Act, 1975.
9. The Board has also taken note of the decision of the Supreme Court in the . c.".-ie
of M/s. Fenuplast (P) Ltd., reported in 1994 (72) ELT 513(S.C.) wherein the Supreme
Court has ordered the classification of coated cottonfabrics (popularly known as
rexine cloth) under item 19-111 of the erstwhile Central Excise Tariff which
corresponds to heading 59.03 of the new Central Excise Tariff Act, 1985.
10.Therefore, keeping in view the Chapter notes HSN notes, the decision of the
Conference of Commissioners held at Madras, and the judgment of the Supreme Court it
is clarified that PVC leather cloth also known as rexine cloth will be appropriately
classifiable under Heading No. 59.03 of the Central Excise Tariff Act, 1985.
11. Trade and Held formations may be advised accordingly.
12 All pending disputes/assessments may be finalized in view of the above guidelines.
Sd/-
(Rajiv Bhatia)
Under Secretary to the Government of India
F.No. 93/13/93-CX.3Presented by eximkey.com