TMI Blog2011 (9) TMI 921X X X X Extracts X X X X X X X X Extracts X X X X ..... Chapters 48 and 49 of First Schedule to Central Excise Tariff Act, 1985. The appellants were also availing SSI exemption under Notification No. 8/2003, dated 1-3-2003. On a visit of the factory premises, it was noticed by the officers that the appellant company manufactured and cleared various dutiable goods during the years 2004-2005, 2005-2006 and 2006-2007, due to which their value of clearances exceeded the limit prescribed in Notification No. 8/2003. After coming to such a conclusion, the visiting officers were of the view the benefit of Notification No. 8/2003 is not eligible to appellant company. They recorded a statement of Director of the Company as regards goods which were cleared and whose value was not considered for calculating the aggregate value for the purpose of SSI exemption. Based on these allegations, a Show Cause Notice dated 10-9-2008 was issued, proposing recovery of Central Excise duty of ₹ 33,79,777/- (Rs. Thirty Three Lakhs, Seventy Nine Thousand, Seven Hundred and Seventy Seven only) under first proviso of Section 11A of Central Excise Act, 1944, interest on the said amount under Section 11AB of Central Excise Act, 1944, penalty under Section 11AC o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ival claims. He would also draw our attention to the HSN explanatory notes and also to the C.B.E. C. Circular on the issue. He would then draw our attention to the Chapter Note No. 12 of the Chapter 48, which reads and it was submitted that the products manufactured by the appellant will not fall under category of items which would have motifs, character or pictorial representation which are not merely incidental to the primary use of the goods. It is his submission that the products which are manufactured by the appellant which are listed out are types of forms like pre-printed Excise invoice, etc. and various other forms, wherein the details have to be filled up by the purchaser of the form to make it complete. He reads the HSN explanatory note annexed at Page 574 as regards products that would get covered under Chapter 48 and exclusions thereof. He would also draw our attention to the inclusions in Chapter 49.11 of HSN for the purpose of pointing out the difference between two Chapter Headings, and how their products would not get covered under Chapter 48. He also read C.B.E. C. Circular dated 15-10-1991 for the purpose of showing clarity on the classification of the product ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Heading 48. He would emphasize on the explanatory note of HSN to Chapter 48, after reading the same, submits the note indicates the articles of the type manufactured would get covered under Chapter 48. He would also submit that exclusion given in the HSN explanatory notes to Chapter 48 are specific and cannot be said to include the items manufactured by appellant company. He would emphasize that for the product in question, the appellant has pre-printed the entire details e.g. Excise Invoice form, the name and date, details of goods, value thereof, duty liability, sales tax liability, etc., are pre-printed. It is his submission that filling up of the information in Excise invoice would not mean that only minor details are filled. It is his submission that identical issue was raised in the case of Surya Offset before this Bench and this Bench vide Final Order No. A/223/WZB/AHD/2011, dated 4-2-2011 [2011 (267) E.L.T. 516 (Tri.)] in Paras 9 10 has categorically held that the items which are under dispute would fall under Chapter Heading 48 and more specifically 48.20. It is his submission that this judgment was delivered recently i.e. on 4-2-2011. He would submit that the issue inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rms 15. Pre-printed Excise Export Invoice Forms 16. Pre-printed Tax Invoice Forms 17. Pre-printed Retail Invoice Forms 18. Pre-printed Retail/Tax Invoice Forms 19. Pre-printed Bank Payment Voucher Forms 20. Pre-printed Form No. 402 Forms 21. Pre-printed Stock Transfer Forms 22. Pre-printed Pay Slips Forms 23. Pre-printed Restaurant Bill Forms 24. Pre-printed Letter Head Forms 25. Pre-printed Goods Inward-cum-Inspection Report Forms 26. Pre-printed Pay Roll Outer Forms 27. Pre-printed Invoice Forms on Carbonless Paper Forms 28. Pre-printed Repair Order Forms 29. Pre-printed Credit/Cash Memo Forms 30. Pre-printed Debit Memo Forms 31. Pre-printed Test Report Forms 32. Pre-printed Job Order Forms 33. Pre-printed Certificate of Analysis Forms 34. Pre-printed Forms 35. Pie-printed Contract Forms 36. Pre-printed L R Forms 37. Pre-printed Grahak Ni Fariyad Forms 38. Pre-printed Petty Cash Voucher Forms 39. Pre-printed Vij Bill Bharva Mate Forms 40. Pre-printed Meter Testing Forms 41. Pre-printed Letter for New Connection Forms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g. 16% Chapter Heading 49.11 in HSN : 4911 Other Printed matter, including printed pictures and photographs 4911 10 Trade advertising material, commercial catalogues and the like : Kg. Nil 4911 10 10 Posters, printed Kg. Nil 4911 10 20 Commercial catalogues Kg. Nil 4911 10 30 Printed inlay crds Kg. Nil 4911 10 90 Other Kg. Nil Other : Kg. Nil 4911 91 00 Pictures, designs and photographs Kg. Nil 4911 99 Other: Kg. Nil 4911 99 10 Hard copy (printed) of computer software Kg. Nil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct position, we reproduce one of the forms which was considered by ld. Commissioner (Appeals) as falling under Chapter Heading 49.11. 14. It can be seen that the above said form also needs to be filled with some details which is to be filled either by hand or type-writing. 15. Specimens of some of the forms where the lower authorities have held that the appellant s product needs to be classified under Chapter Heading 48 is as follows : 16. It can be seen from the above that consignment note also requires to be filled in with some kind of details and the Complaint form also needs to be filled in with some kind of details. In both type of pre-printed forms, details depicted on the forms indicate that the said forms arise from a specific office or a place or an organization. 17. After reproducing the un-disputed and factual position, we now address ourselves to Chapter Note 12 which is reproduced in Paragraph 11 hereinabove. 18. On plain reading of Chapter Note, it can be seen that motifs, character or pictorial representation which are not merely incidental to the primary use of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd but not including music), and also their carbon copies or photographic reproductions on sensitized paper of such texts, are also included in this heading whether bound or not. This heading does not cover : (a) Copying and transfer papers, bearing written or typed texts for reproduction (heading 48.16) (b) Printed plans and drawings (heading 49.05, 49.11) (c) Typescripts (including carbon copies) and copies of manuscripts or typescripts obtained by duplicating machines (heading 49.01 or 49.11) 19. It can be seen from the above reproduced General Notes to HSN that Chapter 49, that they very clearly indicate barring few exceptions, Chapter 49 covers all printed matters of which essential nature and use is determined by the fact of its being printed with motifs, characters or pictorial representation. In our considered view, entire issue needs to be read in context of Chapter Note 12 of Chapter 48, which clearly defines the scope and purport of Chapter Heading 48.20. A plain reading would mean that even if a product falls under the general description of Tariff Heading 48.20, it would not get classified thereunder if the printed motifs, characters or pict ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce in the forms for which the impugned order has accepted the classification as 49.11, and the other forms for which the Commissioner (Appeals) has not accepted the classification under 49.11. 23. We find that in an identical issue, in the case of Sunstrand Forms Pvt. Ltd. (supra), the co-ordinate Bench of this Tribunal was considering the classification of the product manufactured by the assessee in that case indicated in Para 2 of the said order. 2. that the products manufactured by them are invoices, statements, guest folios, restaurant bills, MICR Bank Cheques, etc. which are purchased only by the actual users such as Five Star Hotels, airlines, multi-national banks and multinational companies. He explained the manufacturing process by mentioning that duty paid printing paper is purchased in reel form; these reels are put on slitters to obtain different width; slit paper remaining in reel form is put on the said two machines where printing is done in different colours on the first three towers; Paper then moves to fourth tower in the continuous form where, if required, the spot coating of ink is done at the respective selected spots on the printed paper; thereafter p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 26. In the case of Sai Security Printers Ltd. (supra), the Bench had considered that the classification of the product Lottery tickets, bus tickets, cheque books, demand draft and MTNL-VCC Trump Card etc. printed on thermal paper rolls. While holding the said products would fall under Chapter 49, the Bench has observed as under : 4. We have examined the case records and heard both sides. We have also examined the specimens produced by the appellant in his paper book. We find that the thermal paper produced before us bears words and graphics. Both slit and unslit specimens bear such printing. It is, therefore, evident that the imported thermal paper has first under gone printing and later on cutting and slitting has taken place. There is also no dispute that the appellants are clearing this product in roll form so that the same could be used by various users straightway as in online lottery. We are, therefore of the view that the product in question can be rightly classified under sub-heading 4901.90 as it can be treated as the product of the printing industry. While arriving at this conclusion, we also rely upon the ratio arrived at by the Hon ble Supreme Court in their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rein was seeking classification under Chapter 49 as other printed products of printing industry, while Revenue was seeking classification under Chapter 48 as printed thermal paper. After considering the rival submissions in that case, the Bench held as under : 9. The basic dispute here is whether the printed rolls prepared in question have changed their character from the imported thermal paper to products of printing industry. The test laid down In the HSN Notes is whether the printing is incidental or not. If the printing is incidental, the item would continue to be paper. If it is not, the item becomes product of printing industry. The parties canvass opposite contentions on the nature of printing carried out. According to the appellant, printing is not incidental and printing makes the rolls blank lottery tickets and the paper has ceased to be thermal paper. Commissioner has found fault with this contention about the changed character by pointing out that, in the absence of specific ticket numbers, the printed rolls continue to be thermal paper. 10. The finding of the Commissioner is erroenous and is contrary to normal commercial practices. In the very nature of selling ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstituted. It is also further seen that the decisions as has been produced before us, as indicated by us in preceding paragraphs as regards classification of identically placed goods, were never produced before the Bench, due to which, the view taken by the Bench seems to be different than the view taken by various decisions of the Tribunal. 29. In view of this, we are of the opinion that there was inadequate assistance to the Bench in case of Surya Offset and hence though the decision in regards of similar products, is per incurium as it has not considered the binding decisions of co-ordinate Bench. We have followed the ratio of various decisions as cited hereinabove while coming to the conclusion in this case. We also find that the judgment of Hon ble Supreme Court in the case of Metagraphs Pvt. Ltd. (supra), a ratio has been laid down which is guiding factor for coming to a conclusion whether the product will fall under the category of product of Printing Industry or otherwise. Their Lordship in Para 10 has laid down the ratio which is with respect reproduced. 10. The label announces to the customer that the product is or is not of his choice and his purchase of the com ..... X X X X Extracts X X X X X X X X Extracts X X X X
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