1997 (7) TMI 264 - AT - Central Excise

Summary

Issues:
1. Classification of the product under Chapter 48 of the CETA, 1985 and the benefit of Notification 25/84.
2. Dispute regarding the definition of kraft paper as per Note 6 to Chapter 48.
3. Approval of the classification list provisionally and the subsequent issuance of a show cause notice.
4. Application of Chapter Note 6 for determining the eligibility for the benefit of Notification 25/84.
5. Interpretation of the language used in the notification in contrast to the statutory definition in the tariff.

Analysis:
1. The case involves the classification of the product manufactured by the respondents under Chapter 48 of the CETA, 1985 and the benefit of Notification 25/84. The respondents claimed the benefit of a concessional rate of duty under the notification for their product known as kraft paper.

2. The dispute arose when a show cause notice was issued proposing recovery of duty as the product was alleged to not meet the definition of kraft paper as per Note 6 to Chapter 48. The Assistant Collector contended that the product did not contain the required fiber content obtained by specific processes.

3. The lower Appellate authority found that the Revenue did not draw samples of the disputed product for analysis as per Note 6. It was argued that the product was recognized as kraft paper by the trade, and hence, the benefit of the notification should apply.

4. The Tribunal upheld the lower authority's decision, emphasizing that once the classification of the product as kraft paper was accepted, the benefit of the notification should extend to the product. The Tribunal noted that the department did not dispute the classification of the product as kraft paper.

5. The Vice President's order highlighted the provisional approval of the classification list and the absence of conclusive evidence that the product did not qualify as kraft paper. The Tribunal emphasized the need for proper testing and classification determination before denying the benefit of the notification.

6. The Tribunal concluded that the language used in the notification, which referred to common parlance tests, should prevail over the statutory definition in the tariff. The lack of evidence presented by the department regarding the product not being commonly known as kraft paper led to the rejection of the appeal.

This detailed analysis covers the issues related to the classification of the product, the application of relevant definitions, the procedural aspects of provisional approvals, and the interpretation of statutory provisions and notifications in the given legal judgment.