2015 (10) TMI 1653 - AT - Central Excise

Waiver of pre deposit - Classification of goods - Held that - The chapter note no. 12 of Chapter 48 reads as under except for the goods of heading 4814 or 4821, paper, paper board, cellulose wadding and articles thereof, printed with motifs, characters or pictorial representation which are not merely incidental to the primary use of the goods, fall in chapter 49. Further the Learned Commissioner has also relied upon the explanatory of HSN under chapter 4821 which reads as under this heading covers of varieties of paper and paper board, labels used for attachment to any type of article for the purpose of indicating its nature, identity, ownership, destination, price etc. They may be of the stick-on-type (gummed are self adhesive) or designed to be affixed by other means example string . - he second sticker produced relates to a product Nicetamol and has a label which again identifies the product and its nature. The third sticker is covering an item and the label for the time which is given away as gift or presentation and therefore can be said to be advertisement or can be said to be a nature of label indicating the use of the products. Prima facie, the stickers produced by the appellants are covered by HSN chapter notes. Nevertheless, in view of the fact that at the original level the original adjudicating authority had taken a view in favor of appellant and further issue relates to classification and requires detailed consideration of Tariff description, HSN notes etc. in our opinion, it would be sufficient if appellant deposits an amount of ₹ 50,000/- as predeposit. - Partial stay granted.

Summary

Issues:
Classification of self-adhesive stickers under chapter heading (4821 10 90) or chapter 49 for duty rate determination, imposition of duty, interest, and penalties under Central Excise Rules, 2002.

Analysis:
The appellant, engaged in manufacturing carton boxes, labels, and other products, faced a demand for duty of &8377; 2,46,067/- due to the classification of self-adhesive stickers. The appellant argued that the stickers should be classified under chapter 49 as products of the printing industry, while the Revenue contended they should fall under chapter 48. The Tribunal noted that the chapter note no. 12 of Chapter 48 excludes goods of heading 4814 or 4821, indicating that products printed with motifs, characters, or pictorial representations not incidental to the primary use fall in chapter 49. Additionally, the Tribunal considered the HSN explanatory note under chapter 4821, covering paper labels for indicating nature, identity, ownership, etc. The Tribunal examined three sticker samples provided by the appellant, finding them prima facie covered by the HSN chapter notes. However, due to the original authority's favorable view and the need for detailed consideration of tariff descriptions and HSN notes, the appellant was directed to deposit &8377; 50,000 as a predeposit within four weeks. Compliance would result in a waiver of the balance dues' predeposit requirement, with a stay against recovery during the appeal's pendency.