1992 (10) TMI 174 - AT - Central Excise

Summary

Issues: Classification of printed, lacquered, varnished tin sheets under Central Excise Tariff Act, 1985; Eligibility for exemption under Notification 202/88-C.E.

In this judgment by the Appellate Tribunal CEGAT, New Delhi, the main issue was the classification of printed, lacquered, varnished tin sheets manufactured by the appellants under the Central Excise Tariff Act, 1985. The question was whether the sheets should be classified under Heading 7212.30 as claimed by the appellants or under Heading 7212.90 as confirmed by the Department. Another issue was the eligibility of these items for the benefit of exemption under Notification 202/88-C.E., dated 20-5-1988.

The appellants, engaged in manufacturing containers of base metal other than aluminum, carried out job work of lacquering, varnishing, and printing of tin sheets. The process of printing on tin sheets was done based on customers' designs, similar to offset printing on paper. The appellants classified printed tin sheets under Heading 7212.30 in their classification list, seeking exemption from excise duty as per Notification 202/88. However, show cause notices proposing a duty levy were issued by the Department, contending that the sheets should be classified under Heading 7212.90. The appellants argued that printing is not a manufacturing process unless specified in the Tariff Item, hence no duty should be levied on it.

The Tribunal analyzed the definition of "manufacture" under Section 2(f) of the Central Excises and Salt Act, 1944, post the introduction of the Central Excise Tariff Act, 1985. It noted that unless the process of printing is included in the Tariff Item's description, it does not amount to a manufacturing process attracting excise duty. The Government's clarification and a Trade Notice further supported that printed tin sheets should be classified as varnished sheets under Heading 7212.30, making them eligible for exemption under relevant notifications.

Based on the discussion, the Tribunal held that the printed, lacquered, varnished tin sheets should be classified under Heading 7212.30 of the Central Excise Tariff Act, 1985. It also determined that the sheets were eligible for exemption under Notification 202/88 dated 20-5-1988, as they were final products made from duty-paid inputs specified in the notification. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellants with any consequential relief due to them.