TMI Blog2015 (8) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... mely, that they are to be used for security purposes. Also, the HSN Explanatory Notes are relevant, which according to the judgment of this Court reported in 'Collector of Central Excise, Shillong v. Wood Craft Products Ltd.' [1995 (3) TMI 93 - SUPREME COURT OF INDIA] Decision relates to product ‘hologram’ and the Hon’ble Supreme Court held that it is a product of printing industry classifiable under Chapter 49. The only difference in the present case is the goods are PVC film printed with logos. - By respectfully following the above decision of the Hon’ble Supreme Court and the Tribunal’s decision in Srikumar Agencies (supra), we hold that the product “printed PVC film” is classifiable under Chapter 490190 chargeable to nil rate of duty. Accordingly, the impugned order is set aside - Decided in favour of assessee. - E/737/2004 - Final Order No. 40773 / 2015 - Dated:- 7-7-2015 - Shri R. Periasami and Shri P. K. Choudhary, JJ. For The Appellant : Shri S. Raghu, Advocate For The Respondent : Ms. Indira Sisupal, AC (AR) Per R. Periasami The present appeal is second round of litigation before this Tribunal. 2. The brief facts of the case are that the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he reiterated the findings recorded by the learned Commissioner (Appeals). She relied on the following case laws:- (a) Union of India Vs. Rollatainers Ltd. - 1991 (55) ELT 317 (Kar.) (b) Rollatainers Ltd. Vs. Union of India - 1994 (72) ELT 793 (SC) (c) Garden Silk Mills Ltd. Vs. Collector of Customs, Bombay - 1997 (91) ELT 263 (SC) 7. We have considered the submissions of both sides and perused the records. The short issue to be decided is whether product PVC films printed with logos is classifiable under Chapter 490190 or 3920.39. It is pertinent to state that due to divergent decisions of Hon ble Supreme Court and various High Courts and Tribunal decisions, the issue was placed before the Larger Bench of the Hon ble Supreme Court and the Hon ble Apex Court in the case of CCE Vs. Srikumar Agencies (supra), remanded the batch of appeals to the Tribunal. The Tribunal in the Final Order No. 659 to 683/2011 dated 9.8.2011 in the case of Srikumar Agencies Ors. examined the issue in detail taking into account of Hon ble Supreme Court s decision in the case of Union of India Vs. Rollatainers Ltd. (supra) and ITC Ltd. Vs. CCE. The relevant paragraphs of Tribunal s order ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of packaging industry. Hon ble Supreme Court after noting that the printing industry by itself could not bring cartons into existence, held that such printed cartons could not be considered as products of printing industry. The ratio of the said decision cannot be applied to the facts of the present case which involve determination of classification of the printed products which could fall either under chapter 48 or 49 depending upon the nature and scope of printing on the products. Hon ble Supreme Court, in the ITC Ltd. cited supra considered appeal against the CEGAT s Final Order No.251 to 256/95-C dt. 31/8/1995 (copy placed on record by ld. SDR). On perusal of the said order of the Tribunal, it is noticed that the same dealt with classification of items like printed racks unfolded, printed top lid flats unfolded, printed hanged lid, printed shells/hulls, and slider which are parts / components of packets meant for packing of cigarettes. The Tribunal held that they could not be treated as products of printing industry on the ground the capacity to contain is essential characteristic of a carton and not the printing work on it which is merely incidental. Tribunal heavily relied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xxxxx xxxxxx xxxxx 16. The real question, therefore, in this appeal is the application of Note No. 2 to entry 49, which reads as follows: - Except for the goods of Heading No. 39.18 or 39.19, plastics, rubber and articles thereof, printed with motifs, characters of pictorial representations, which are not merely incidental to the primary use of the goods, fall in Chapter 49. 17. It is clear therefore, that the question resolves itself into whether printing is only incidental to the primary use of the goods or is something more than something merely incidental. We have already referred to the process hereinabove and the final product which emerges is a product which is used for security purposes. It is important to remember therefore, that the primary use of the product is security and not the quality of being adhesive. Here again, a simple example will suffice. Take an adhesive tape with a monogram printed upon it. The primary use of such tape is by virtue of its adhesiveness to bind and package containers in which goods are to be stored and transported. Obviously, in such an example, the printed monogram of such adhesive tape would be 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 ..... ary use. Similarly, in the facts of the present case, a security hologram sticker would have as its primary part, the security hologram, the sticker part or adhesive part only being incidental to the primary use of the said goods. xxxxxx xxxxx xxxxxx xxxxx 21. It will be seen that under Para 3 of the second circular self adhesive embossed holograms will now fall under Heading 39.19, whereas embossed plastic holograms which are not self adhesive alone will fall under entry 49. This is said to be in view of Note 2 to Chapter 49. We are afraid that the second circular which has been quoted hereinabove does not set out the law correctly. It is clear that merely because a particular embossed hologram is self adhesive, therefore in all cases, it will attract entry 39 is not correct. What is to be seen, as has been pointed out above, is whether the self adhesive part of the product is of primary use or the printed matter is of primary use. It cannot be that invariably in all cases, the moment a hologram is self adhesive it will fall within entry 39 without more. To this extent, it is clear that the circular as has been noted above, does not lay down the correct law. 22. We will n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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