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CX – No distinct, identifiable commodity emerges out of process of printing undertaken by respondent - no justification to charge CE duty on printed paper Rolls: CESTAT

By TIOL News Service

NEW DELHI, JUNE 05, 2017: THIS is a Revenue appeal filed in the year 2010.

The respondent is having a printing press and is engaged in the activity of printing of various articles of paper or paper boards. One of their products is 'Printed Chromo Art Paper Rolls' which is obtained by printing upon the Chromo Art Paper Rolls purchased from the market. The respondent was clearing the said product without payment of Central excise duty by classifying the same under 49119990.

It is the Revenue view that the said product is classifiable as "Printing & Wrapping Paper" SH48239013 and attracts CE duty @16% from August 2006 to February 2008 and at the rate of 14% thereafter.

Demand notice of Rs.6.94 lakhs was issued and the same was confirmed by the adjudicating authority.

However, the Commissioner(A) set aside the order and, therefore, Revenue is in appeal before the CESTAT.

After considering the submissions made by both sides, the Bench inter alia observed thus –

+ The product is being supplied in the form of printed sheet to M/s Eveready Industries Limited. The item is used for packing and wrapping the battery cell. In retail shops, the pencil cells are bubble packed and the printed paper remains on the back side of the product in question.

+ It is to be noted that the primary function of the said product is packing the battery cells and printing thereon is merely incidental to the primary use of the product.

+ Having noted the fact that printing is merely incidental to the primary use of the goods i.e., packing of cells, in the light of the chapter note 12, it is evident that the goods are not liable for classification in chapter 49, but will remain classified in chapter 48 only.

+ Since printing on the paper is purely incidental to its main use, we are of the view that the classification of the printed paper Rolls will also remain within the same chapter subheading 4810 13 30.

+ It is easily seen that no distinct, identifiable commodity emerges out of the process of printing undertaken by the respondent. The Chromo Art Paper Rolls remain the same albeit with printing. Hence, in our opinion, no new commodity emerges and hence there is no justification to charge Central excise duty on the printed paper Rolls.

The Revenue appeal was rejected.

(See 2017-TIOL-1864-CESTAT-DEL)


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