TMI Blog1985 (8) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... ine on one side or both sides, as required, by means of a coating roller and an equalising rod and then passing it through chilled rollers. 4. After holding adjudication proceedings, the Assistant Collector, Thane, Division I, by an order dated 18-9-80, held that the carbon paper manufactured by the appellants fell under Item No. 17(2),CET with the amendments brought about in item 17 by the Finance Act of 1976 and not under item 68 CET as contended by the appellants. The matter was pursued in appeal. The Appellate Collector, Bombay by his Order dated 17-3-82, confirmed the Assistant Collector s Order and dismissed the appeal. It is against this Order of the Appellate Collector that the appellants are presently before us. 5. We have heard Shri Soli Sorabjee, Senior Counsel assisted by Shri S. Ganesh and Shri R.K. Habbu, Advocates for the appellants and Shri V. Lakshmikumaran, Senior Departmental Representative for the respondent. 6. The submissions made by Shri Soli Sorabjee, learned Counsel for the appellants, may be summarised thus:- (i) The 1976 budget changes did not have the effect of bringing carbon paper under item 17(2) CET. Carbon paper was brought under item 17 f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tition between Items No.17 and 68. (ii) Item No. 17(2) might not be a definition: it was much more than that. The item covered paper which was subjected to treatment -it did not require that the treated paper should be known as paper in the trade. Even if Carbon paper was known in the trade as an article of stationery and not as paper, it would still fall under Item No. 17(2) (by virtue of the inclusive character of the item) since it was paper falling under Item No. 17 which was subjected to treatment. The question of considering item 68 would not, therefore, arise. The Tribunal s decision in [1984 (17) E.L.T. 590] was cited in this context. (iii) The Supreme Court s decision in the Kores (India) Ltd., case (supra) would not apply to the facts of the present case since the Central Excise tariff entry was not in paria materia with the entry in the Tax law. (iv) The Tribunal had considered the classification of carbon paper in the following cases :- (a)" Continental Carbon Ribbon Mfg. Co. v. Collector of Central Excise, Calcutta - Order No. 456 : 457/84-C, dated 16-7-1984. (b) Universal Carbon Ltd., Hyderabad v. Collector of Central Excise, Hyderabad - Order No. 55/85-C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SPECIFIED BELOW, in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power - (1) Uncoated and coated printing and writing paper (other than poster paper). (2) Paper board and all other kinds of paper (including paper or paper boards which have been subjected to various treatments such as coating, impregnating, corrugation, creeping and design printing), not elsewhere specified - (a) X X X X X X (b) X X X X X X (3) Carbon and other copying papers (including duplicator, stencils) and transfer papers, whether or not cut to size and whether or not put up in boxes. (4) X X X X X X 9. The base paper is admittedly a paper falling under item 17 which has discharged its duty burden. The question is whether after it is subjected to the processes described in the earlier part of this Order, and has acquired its identity as carbon paper, would still fall under Item No. 17(2) CET or under the residual Item No. 68. It is the appellants contention as set out in the memorandum of revision (the appeal before us), that the said processes result in or bring into existence a substanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her the ratio of the decision has application to the case before us. In this context, it will be useful and relevant to note the observations of the Supreme Court in its recent judgment in Empire Industries Ltd. and Others v. Union of India and others - [1985(20)-E.L.T.179(SC)]. It may be noted that the taxable event in the context of Sales Tax Law is sale . The taxable event under the Excise Law is manufacture . The moment there is transformation into a new commodity commercially known as a distinct and separate commodity having its own character, use and name, whether be as the result of one process or several processes manufacture takes place and liability to duty is attracted." The above passage occurs in para 30 at page 193 of the report. 12. We have reproduced in the earlier part of this order Item 17(2) of the CET as it stood at the relevant time. This sub-item covers inter alia all other [i.e. other than the paper specified in sub-item (1) ] kinds of paper (including paper which has been subjected to various treatments such as coating, impregnating, corrugation, creeping and design printing), not elsewhere specified. Now, in the present case, tissue paper is indispu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stood as a coated paper in trade, we have the authority of the Indian Standards Institution s publication Glossary of Terms used in Paper Trade and Industry - IS:4661: 1968. This Glossary as the book shows, was drawn up by a paper sectional committee consisting inter alia of representatives of All India Federation of Master Printers, Bombay, Stationery and Office Equipment Association of India, Calcutta, Indian Paper Mills Association, Calcutta, Calcutta Paper Traders Association, Indian Paper Makers Association, Calcutta etc. apart from technical and other authorities. As the foreword shows, the standard has been formulated with a view to eliminate ambiguity and confusion, arising from different interpretations of terms used in paper trade and industry and establishing a generally recognised usage and that, wherever possible, the terms accepted by the I.S.O. (International Standards Organisation) had been retained realising the need for a common terminology throughout the world, (paras 0.2, 0.3). The Standard defines the terms commonly used in the paper trade and industry in this country (India) (para 1.1). The following definition occurs in the Glossary: Carbon paper - Paper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce Bill (which is the item under consideration now). The notices are hence not relevant for the present purpose nor are they decisive of the question as fairly stated by Shri Soli Sorabjee. 17. The analogy of the Brussels Tariff Nomenclature (C.C.C.N.) is, in our view, of no help in resolving the dispute before us. The C.C.C.N. has a specific entry - 48.13 - which covers inter alia carbon paper. The question of considering carbon paper for inclusion in 48.07 as a coated paper, therefore, does not arise. Nor is the reference to I.S. specifications for Carbon paper of any help. These specifications are quality specifications and have nothing to do with the question whether carbon paper is a coated paper. As we have seen, the I.S.I. Glossary of Terms defines carbon paper as a coated paper. 18. The Gujarat High Court decision in Hind Engineering Co. v. Sales Tax Commissioner 1984(17) E.L.T. 268(Guj.) = [1974 T.L.R. 1788 (Guj.)] was re-lied upon by the learned Counsel for the appellants in support of the contention that if, as a result of treatment, paper loses its identity as paper, and gets transformed into a different commercial commodity, then it cannot be classified under Item ..... X X X X Extracts X X X X X X X X Extracts X X X X
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