1991 (3) TMI 273 - AT - Central Excise

Summary

Issues:
Determining eligibility of duty exemption for gummed paper under Central Excise Notification No. 49/87.

Analysis:
The appeal before the Appellate Tribunal CEGAT, New Delhi involved the question of whether gummed paper manufactured by the appellants, falling under Heading 4811.20 of the Central Excise Tariff Act, is eligible for duty exemption under Central Excise Notification No. 49/87. The notification exempts converted types of paper from excise duty if certain conditions are met, excluding gummed or adhesive paper in strips or rolls. The appellants argued that their gummed paper does not fall under the excluded category, as it is classified under sub-heading 4811.20, not 4817.10 or 4823.11, which are specifically mentioned in the notification. They claimed the goods were cleared in reels, not rolls. The department contended that regardless of the sub-heading, all gummed paper is excluded from the notification.

The Tribunal analyzed the definitions of "reel" and "roll" in the Indian Standard Glossary of Terms used in the paper trade and industry. It noted the distinction between the two terms, emphasizing that reels are continuous webs wound on a core, while rolls are continuous strips rolled around themselves without a core. The Tribunal also examined the statutory notes and explanatory notes to understand the meaning of "rolls" in different headings. It concluded that gummed paper in rolls under sub-heading 4823.11 refers to those cut to size or shape, not continuous webs like reels.

The Tribunal further considered the classification of the subject goods under sub-heading 4811.20, which covers gummed or adhesive paper in rolls or sheets. It determined that Notification No. 49/87 applies to gummed paper cleared in rolls or sheets, excluding those cleared in strips or rolls cut to size or shape. Citing legal principles and precedents, the Tribunal emphasized the need for consistent interpretation of terms in notifications and parent acts. Due to conflicting evidence on how the gummed paper was cleared, the Tribunal remanded the matter to the Collector (Appeals) for further determination based on additional evidence from both parties.

In conclusion, the Tribunal set aside the previous order and instructed the Collector (Appeals) to conduct a fresh assessment to ascertain whether the appellants' gummed paper qualifies for the duty exemption under Notification No. 49/87, depending on how it was cleared - in reels or rolls.