1996 (8) TMI 305 - AT - Central Excise

Summary

Issues: Classification of Telex/Teleprinter Paper Rolls under the Central Excise Tariff Act, 1985 and entitlement to duty exemption under Notification No. 49/87-C.E.

In the judgment delivered by the Appellate Tribunal CEGAT, Madras, the appeal was filed against the orders passed by the C.C.E. (Appeals), Madras concerning the classification of Telex/Teleprinter Paper rolls under the Central Excise Tariff Act, 1985. The appellants initially classified these rolls under sub-heading 4823.90 and filed a classification list under protest, claiming duty exemption under Notification No. 49/87-C.E., dated 1-3-1987. However, the lower authority classified the goods under sub-heading 4817.90 until 28-2-1988 and under sub-heading 4823.19 from 1-3-1988 onwards. The appellants contended that the conversion of base paper into telex/teleprinter rolls does not constitute manufacture. They argued that if this contention is rejected, the goods should be classified under sub-heading 4823.90, entitling them to the claimed exemption.

The main issue before the Tribunal was whether the telex/teleprinter papers should be classified under sub-heading 4818.90 before 1-3-1988 and under heading 4823.90 after that date. The appellant argued that the process of slitting does not amount to manufacture. However, the Tribunal referred to a decision of the Hon'ble Bombay High Court in the case of M/s. Ramsay India Pvt. Ltd. v. CCE, which held that the conversion of base paper into teleprinter rolls or tapes results in a different product with distinct characteristics and usage. The High Court ruled that such conversion constitutes a process of manufacture under the Central Excises & Salt Act, 1944. The Tribunal found that teleprinter rolls and tapes are distinct items from printing and writing paper, known in the market by their specific names and uses, and are sold as separate commodities. Therefore, the Tribunal concluded that the goods fall outside the scope of the claimed exemptions under Notification Nos. 63/82 and 49/87, dated 28-2-1982 and 1-3-1987, respectively.

In light of the above analysis, the Tribunal dismissed the appeal, holding that the conversion of writing and printing paper into teleprinter rolls and tapes constitutes a process of manufacture under the law. The Tribunal affirmed that the goods in question are distinct commodities with specific identities and uses, not eligible for the claimed duty exemptions. The decision was based on the findings that the teleprinter rolls and tapes are separate items from the base paper, recognized in the market by their unique names and characteristics. Consequently, the appellant was deemed ineligible for the benefit of the claimed exemptions under the relevant notifications.