1994 (9) TMI 163 - AT - Central Excise

Issues Involved:
1. Admission of Test Report as additional evidence.
2. Classification of Thermal Paper under the appropriate Customs Tariff Item.

Detailed Analysis:

1. Admission of Test Report as Additional Evidence:
The Collector of Customs filed Misc. Application No. C/Misc/553/94-C to admit a Test Report dated 23-6-1993 issued by the Chief Chemist, Central Revenue Control Laboratory. The Department received this Test Report after the Collector (Appeals) had passed the impugned order. The applicant argued that the Test Report was crucial for a judicious decision. However, the respondent opposed its admission, stating that the report was not available to the lower authorities or disclosed to the appellant.

Upon careful consideration, the Tribunal found that the Test Report was not available during the initial decision-making process and the matter had been decided based on the existing evidence. Consequently, the Tribunal rejected the Misc. Application No. Misc/553/94-C, deciding not to admit the Test Report at the appeal stage.

2. Classification of Thermal Paper:
The primary issue was whether the Thermal Paper should be classified under Customs Tariff Item No. 4811.90 or 3707.10. The Collector of Customs argued for classification under Item No. 4811.90, while the appellant claimed it should be under Item No. 3707.10.

The facts of the case involved the import of Thermal Paper described in invoices and Bills of Entry as "Thermal Paper of 60 HK-2." The Customs Laboratory Test Report for similar goods described the sample as "white sheet of paper made of chemical pulp, coated with organic thermal colouring substances."

The appellant's argument was that the Thermal Paper should be classified under Chapter 37, specifically 37.03, which includes "Photographic Paper, Paper Board, and Textiles, Sensitised, unexposed." The appellant cited various technical definitions and literature to support their claim that Thermal Paper is a thermographic material, which should fall under Chapter 37.03.

The respondent, however, argued that the Thermal Paper did not meet the criteria for classification under Chapter 37.03. They pointed out that Chapter 37 covers sensitised paper that requires developing and exposing, which is not applicable to Thermal Paper. Instead, they argued that the paper should be classified under Chapter 48, specifically 4811.90, which covers "Paper, Paper Board, Cellulose Wadding and Webs of Cellulose Fibres, Coated, Impregnated, Covered, Surface-coloured, Surface-decorated or Printed, in Rolls or Sheets."

The Tribunal analyzed the competing entries and noted the significant difference between Chapter 37 and Chapter 48. Chapter 37.03 covers photographic paper that forms visible images through exposure to light or other radiation, while Chapter 48.11 covers paper coated with organic or inorganic substances.

The Tribunal found that the Thermal Paper in question was coated with organic thermal colouring substances, making it more akin to the goods classifiable under Chapter 48.11. The Tribunal also referenced the judgment in the case of Cosmos Enterprises v. CC, which classified thermal sensitive paper under Chapter Heading 48.11.

In conclusion, the Tribunal held that the Thermal Paper should be classified under Customs Tariff Heading No. 4811.90, as it did not meet the criteria for classification under Chapter 37.03. The Tribunal set aside the impugned order and allowed the appeal, confirming the classification under 4811.90.

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