1997 (12) TMI 218 - AT - Central Excise

Summary

Issues involved: Classification of product "Hanging Cards" u/s Central Excise Tariff, applicability of exemption notification, dominant characteristic for classification.

Classification of Hanging Cards:
The appellants argued that Hanging Cards were approved as a Product of Printing Industry before 28-2-1986 and were exempt u/s Notification No. 234/82. They contended that the product should not be classified u/r sub-heading No. 4823.90 as it excludes "Other articles of Board cut to size and shape." The appellants asserted that the main purpose of the product was advertisement and display, making Chapter 49 more appropriate for classification. The Tribunal observed that the product, resembling posters with advertising material and samples of advertised articles, was primarily intended for advertising purposes. The printing on the cards was not merely incidental but done with the intention to advertise the product, making Chapter 49 the more suitable classification.

Appellate Decision:
The Tribunal noted that prior to the change in the Tariff, the product was classified as a product of printing industry and was exempt u/s Notification No. 234/82. Despite the change in the tariff, the nature of the product as advertising material with printing for display being the dominant role remained consistent. Therefore, the impugned order was set aside, and the appeal was accepted with the direction to reclassify the product under the appropriate heading and reassess considering any applicable exemption notification during the relevant period.

Conclusion:
The appeal against the order of the Collector (A) regarding the classification of Hanging Cards was accepted by the Appellate Tribunal CEGAT, New Delhi. The Tribunal determined that the product, primarily intended for advertising purposes with printing playing a dominant role, should be classified under Chapter 49 of the Central Excise Tariff. The decision highlighted the importance of the main purpose and dominant characteristic of the product in determining its classification, leading to the acceptance of the appeal and reclassification of the product accordingly.