1991 (7) TMI 216 - AT - Central Excise

Issues Involved:
1. Classification of "reel core" under the Central Excise Tariff Act, 1985.
2. Applicability of Notification No. 140/86-C.E., dated 1-3-1986 for exemption from duty.
3. Binding nature of the Central Excise Board's Tariff Advice on quasi-judicial bodies.

Detailed Analysis:

1. Classification of "reel core" under the Central Excise Tariff Act, 1985
The appellants contended that "reel core," manufactured from sub-standard Kraft Paper and used internally for winding paper, should be classified under Tariff Item (T.I.) 4818.12, which pertains to printed cartons, boxes, containers, and cases made wholly out of paper or paperboard. They argued that "reel core" serves as a container for winding paper and thus should fall under this classification.

However, the Assistant Collector and the Collector of Central Excise (Appeals), Madras, classified "reel core" under T.I. 4818.90, which covers "other articles of paper pulp, paper, paperboard, cellulose wadding or webs of cellulose fibers." This classification attracts a duty liability of 12% ad valorem.

The Tribunal examined the definitions and interpretations of "container" as provided in various dictionaries and glossaries. It concluded that a container must be a receptacle that holds, restrains, or encloses goods for storage or transport. The Tribunal referred to the Supreme Court's ruling on similar items like "egg trays" and "egg cartons," which were not considered containers as they did not enclose or cover the items for transport.

The Tribunal found that "reel core" does not meet the definition of a container as it merely serves as a reel for winding paper and does not enclose or cover the paper for transport. Therefore, the appropriate classification for "reel core" is under T.I. 4818.90 as "other articles of paper."

2. Applicability of Notification No. 140/86-C.E., dated 1-3-1986 for exemption from duty
The appellants claimed that "reel core" should be exempt from duty under Notification No. 140/86-C.E., dated 1-3-1986, which provides exemptions for certain items classified under specific tariff headings.

Since the Tribunal upheld the classification of "reel core" under T.I. 4818.90, the exemption under Notification No. 140/86-C.E., which applies to items classified under T.I. 4818.12, is not applicable. Consequently, "reel core" does not qualify for the claimed exemption from duty.

3. Binding nature of the Central Excise Board's Tariff Advice on quasi-judicial bodies
The appellants referred to the Central Excise Board's Tariff Advice No. 46/88, dated 29-3-1988, which classified "reel cores" under T.I. 4818.18 or 4818.19, attracting a "nil" rate of duty. They argued that this advice should be binding on the Tribunal.

The Tribunal, however, noted that tariff advice issued by the Board is not binding on quasi-judicial bodies. This position is supported by the Supreme Court's ruling in the case of C.C.E., Kanpur v. Krishna Carbon Paper Co. - 1988 (37) E.L.T. 480 (S.C.), which held that such advice is not obligatory for quasi-judicial authorities. Therefore, the Tribunal was not bound to follow the Board's Tariff Advice.

Conclusion
The Tribunal upheld the classification of "reel core" under T.I. 4818.90, rejecting the appellants' claim for classification under T.I. 4818.12 and the associated duty exemption under Notification No. 140/86-C.E. It also affirmed that the Central Excise Board's Tariff Advice is not binding on quasi-judicial bodies. Consequently, the appeal was dismissed.

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