1996 (1) TMI 252 - AT - Central Excise

Summary

Issues: Classification of product "Record Bags" under Central Excise Tariff Act, 1985.

The judgment involves the classification of the product "Record Bags" under the Central Excise Tariff Act, 1985. The appellants contested the order-in-appeal passed by the Collector (Appeals), Bombay, which classified the product under sub-heading 4818.13. The Revenue argued that the record bags should be classified under sub-heading 4818.13 as containers, subject to a 35% duty rate. On the other hand, the assessee claimed that the product should be classified under sub-heading 4818.19 with a nil rate of duty as "Other" packing containers. The dispute centered around whether the record bags should be considered containers or cases for classification purposes.

The Learned Advocate for the appellants argued that the record bags should fall under sub-heading 4818.19 as "Other," attracting nil duty, and not under sub-heading 4818.13 as containers. He referred to the Harmonized System of Nomenclature (HSN) entry to support his contention that record sleeves are distinct from cartons, boxes, and cases. The Learned DR for the Revenue contended that the item is a case and should be classified under sub-heading 4818.13. The tribunal carefully considered the submissions and analyzed the relevant tariff heading to determine the appropriate classification for the record bags.

The tribunal examined the Tariff Heading 48.19, which covers cartons, boxes, cases, bags, and other packing containers made of paper or paperboard. It noted that the item in question, referred to as record bags, is a cardboard cover used for gramophone records. The tribunal referred to a previous Supreme Court case regarding the classification of various products as containers and emphasized the need to interpret the term "container" within the context of the tariff entry. The tribunal concluded that the record bags served the purpose of storing gramophone records and, therefore, qualified as containers. However, since containers were not explicitly included in sub-heading 4818.13, the tribunal ruled in favor of the appellants, classifying the record bags under the residuary heading 4818.19 as "Other." The tribunal set aside the Collector's order and allowed the appeal, granting consequential relief to the appellants.