2018 (2) TMI 65 - AT - Central Excise

Scope of SCN - Classification of goods - the very basis of the SCN that the finished products manufactured by the respondents are classifiable under Chapter 48 no longer exists - Held that - the very basis of the SCN that the finished products manufactured by the respondents are classifiable under Chapter 48 no longer exists - appeal dismissed - decided against Revenue.

Summary

Issues:
Classification of finished products under Chapter 48 or Chapter 49 for duty payment.

Analysis:
The appeal was filed by the Revenue against the Order-in-Appeal passed by the Commissioner (Appeals), Customs & Central Excise, Kanpur. The issue revolved around the classification of finished goods manufactured on a job work basis for Sahara India Ltd. The respondents believed their products fell under Chapter 49, which is non-dutiable. Subsequently, the Chief Commissioner clarified that the finished products, namely money receipts interleaved with carbon, were classifiable under Chapter Heading 4901. This clarification was based on the fact that the printed separate sheets used by a specific customer for a specified purpose were considered as printed carbon leaflets falling under Chapter 49. The Chief Commissioner emphasized that the worth of the product was due to the printing on it, making it more aligned with Chapter 49 than Chapter 48. The Commissioner of Customs, Central Excise Kanpur also supported this classification, citing similar decisions in other Commissionerates. The Tribunal, after considering the contentions and the clarification by the Chief Commissioner, concluded that the show-cause-notice basis for classifying the products under Chapter 48 was no longer valid. Therefore, the order of the Commissioner (Appeals) was upheld, dismissing the Revenue's appeals and entitling the respondents to consequential benefits as per the law.

This detailed analysis highlights the key legal issues, the arguments presented by both parties, the clarifications provided by the Chief Commissioner, and the final decision of the Tribunal based on the classification under Chapter 49 for the finished products.