2017 (12) TMI 482 - AT - Central Excise

Classification of goods - Printed Chromo Art Paper Rolls - Held that - printing is merely incidental to the primary use of the goods i.e., packing of cells - the goods are not liable for classification in chapter 49, but will remain classified in chapter 48 only. Whether the printing undertaken on the paper amounts to a process of manufacture in terms of section 2(f)? - Held that - 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 - no new commodity emerges and hence there is no justification to charge Central excise duty on the printed paper Rolls. Appeal dismissed - decided against Revenue.

Summary

Issues: Classification of 'Printed Chromo Art Paper Rolls' for Central excise duty liability.

In the case, the Appellate Tribunal CESTAT NEW DELHI heard an appeal filed by the revenue against an order regarding the classification of 'Printed Chromo Art Paper Rolls' for Central excise duty liability. The respondent, a printing press, was clearing the product without payment of duty under one classification, while the revenue contended it should be classified differently. The issue revolved around whether the printing on the paper rolls amounted to a process of manufacture, resulting in a new commodity attracting excise duty. The primary function of the product was deemed to be packing battery cells, with printing being incidental. The Tribunal referred to Chapter Note 12 to determine classification, which stated that printed goods not merely incidental to the primary use fall under a different chapter. The Tribunal found that since the printing was incidental to the main use of packing cells, the product should be classified under the same chapter as the paper rolls, not as a distinct commodity. As no new commodity emerged from the printing process, the Tribunal concluded that there was no basis to charge Central excise duty on the printed paper rolls. Ultimately, the Tribunal rejected the appeal filed by the revenue, upholding the initial order setting aside the duty demand.