TMI Blog2023 (11) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... ess lie against order [order-in-original no. 28/SK/M-I/2013 dated 30th September 2013] of Commissioner of Central Excise, Mumbai I, confirming demand of duty of ₹ 1,28,51,172/- for the period from 1st January 2012 to 30th November 2012 under section 11A of Central Excise Act, 1944 and imposing penalty of like amount under rule 25 of Central Excise Rules, 2000, and order [order-in-original no. 02/SK/M-I/2012 dated 5th October 2012] of Commissioner of Central Excise, Mumbai I, confirming recovery of duty of ₹ 4,32,21,365/- for the period from 2006-07 to 2010-11 and ₹ 51,49,104/- for the period from 1st April 2011 to 31st December 2011 under section 11A of Central Excise Act, 1944 along with imposition of penalty of like amount under section 11AC of Central Excise Act, 1944 and rule 25 Central Excise Rules, 2002 respectively. Both orders have also confirmed recovery of interest under section 11AB of Central Excise Act, 1944. The bone of contention in the appeals is excisability of books used for internal administration and record keeping in the zonal railway that were printed at zonal railway press. 2. It is the case of the central excise authorities that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The finding of the Commissioner is erroneous and is contrary to normal commercial practices. In the very nature of selling tickets, printed formats cannot have all the particulars. As already noticed in para 7 of this order, HSN Explanatory Notes under Chapter 49 specifically recognizes this and clarifies that certain printed articles may be intended for completion at the time of use and still would remain in the heading 49.11 provided they are essentially printed matter . The note goes on to clarify that printed forms (e.g. magazine subscription forms), blank multi-coupon travel tickets, circular letters, identity documents and cards etc. requiring only the insertion of particulars (e.g. dates and names) are classified in this heading. Thus, existence of blank portions in printed forms do not take them out of other printed products or articles . Many are the items that readily come to mind. Most printed application forms would leave the name and other particulars of the applicant blank. Similarly, ticket forms would not have names/numbers of the buyers. In the present case also, particulars of the buyers/numbers of the lottery tickets would get printed only at the time of sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the printing on the thermal sheets/rolls of paper brought into existence, receipts for the ATM, lottery tickets and rolls for bus tickets. Therefore, printing is not merely incidental to the use of the product as such printing imparts a substantial character and quality to the product. It is true that while actually using, certain particulars are required to be entered in these rolls by the ATM or the lottery machine or in the bus ticket vending machine. Nevertheless the products is specifically meant to be used as ATM receipts, lottery tickets and bus ticket. It is the printing done on the thermal paper which has imparted these characteristics and therefore, it has to be held that printing is not merely incidental to the use of the products. Applying the ratio of the decisions cited supra, it becomes evident that the impugned goods prior to enactment of Finance Bill, 2012 merit classification as products of the printing industry . Further, it is seen that in the Finance Bill, 2012 a specific note 14 (supra) was inserted in Chapter 48 to bring within the scope of Chapter 48 certain products of the printing industry. The said amendment introduced by way of Note 14 to Chapter 48, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re 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 commodity would be decided by the printed matter on the label. The printing of the label is not incidental to its use but primary in the sense that it communicates to the customer about the product and this serves a definite purpose. This Court in Rollatainers case held that what is exempt under the notification is the product of the printing industry. The product in this case is the carton. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are classifiable under Chapter 4901 and hence not liable for duty. On the issue of marketability, in view of the fact that all the printed products are contained details related to and for the purpose of various day to day function of Central Railway, these products are indeed used in-house by Central Railway. Excisebility of the product comes into play only when paper is printed. When bought out paper are printed and comes into existence an excisable product then test of marketability has to be under gone. After printing of the plain paper with the details containing therein all these forms leaflet, folders etc. can be used by Central Railway alone and it can neither be used nor shall be useful for any other person other than Central Railway. This undisputed facts is more than sufficient reason to hold that the product is not marketable because same is neither capable of being bought and sold nor can be factually bought and sold. As regard the marketability, the contention of the Revenue is that the product is commercially known in the market does not hold water for the reason that if the product in the present case since not capable being bought and sold, cannot be commercially k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... minium Company Limited (supra), we disagree with the appellant that zinc dross, flux skimming and zinc scallings are goods and hence excisable. F.G.P. Ltd. v. Union of India [2004 (168) E.L.T. 289 (S.C.)] 14. It is thus clear that the marketability of the goods is an essential ingredient of excisable goods for being subjected to the excise duty. 15. That the goods, are marketable, has to be proved by the excise authorities. In this case the appellants filed affidavits of certain concerns showing that they are not interested in purchasing glass lumps . No evidence whatsoever has been brought on record by the excise authorities to show that the said goods are marketable in the sense stated above. Based on the evidence of affidavits filed by the appellant it is sought to be argued that the deponents may not be interested in purchasing glass lumps but it does not disprove marketability of the goods. We are unable to accept this contention. The burden of showing that the goods are marketable is on the Revenue. In the absence of any proof brought on record by the Revenue that glass lumps are marketable or capable of being marketed, it is not possible to hold that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vent in the case of duties of excises is the manufacture of goods and the duty is not directly on the goods but on the manufacture thereof. Therefore, the essential ingredient is that there should be manufacture of goods. The goods being articles which are known to those who are dealing in the market having their identity as such. Section 3 of the Act enjoins that there shall be levied and collected in such manner as may be prescribed duties of excise on all excisable goods other than salt which are produced or manufactured in India. Excisable goods under Section 2(d) of the Act means goods specified in the Schedule to the Central Excise Tariff Act, 1985 as being subject to a duty of excise and includes salt. Therefore, it is necessary, in a case like this, to find out whether there are goods, that is to say, articles as known in the market as separate distinct identifiable commodities and whether the tariff duty levied would be as specified in the Schedule. Simply because a certain article falls within the Schedule it would not be dutiable under excise law if the said article is not goods known to the market. Marketability, therefore, is an essential ingredient in order to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 (225) E.L.T. 403 (S.C.)] 11. Since marketability is an essential ingredient to hold, that a product is dutiable or exigible, it was for the Revenue to prove that the product was marketable or was capable of being marketed. Manufacturing activity, by itself, does not prove the marketability. The product produced must be a distinct commodity known in the common parlance to the commercial community for the purpose of buying and selling. Since there is no evidence of either buying or selling in the present case, it cannot be held that the product in question was marketable or was capable of being marketed. Mere transfer of BMS by the appellant from its factory at Bangalore to its own unit at Patalganga for manufacture of final product does not show that the product was either marketed or was marketable. 12. Since the Revenue has failed to lead any evidence to show that the product in question was marketable or was capable of being marketed and that the product in question was a distinct product for being sold in the market, it has to be held that the product in question was not marketable. Accordingly, the appeal is accepted. The order of the Tribunal is set aside with cons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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