1998 (8) TMI 173 - AT - Central Excise

Paper - Gum coated paper in the form of sheet or reel and not in the form of strip or roll eligible to benefit of Notification No. 49/87-C.E.

Summary

Issues involved:
- Interpretation of Notification No. 49/87 regarding benefit availability for gum coated paper.
- Application of Note 7 to Chapter 48 in H.S.N. for determining the form of the paper.
- Distinction between "reel" and "roll" forms of paper as per I.S.I. Specification.
- Examination of whether the impugned paper was in reel or roll form.

Analysis:

The primary issue in the appeal was the eligibility of M/s. Shree Vindhya Paper Mills Ltd. for the benefit of Notification No. 49/87 concerning gum coated paper. The appellant undertook gum coating on stamp base paper and claimed the benefit based on the exclusion of "gummed or adhesive paper in strips or rolls" from the notification. The Department argued that the product exceeded 15 cms in width, classifying it as a roll under Note 7 to Chapter 48 in H.S.N., thus not qualifying for the exemption.

The appellant's representative highlighted the absence of Note 7 in Chapter 48 of the Central Excise Tariff Act, citing precedents where statutory notes were not used for interpretation. Referring to relevant cases, it was argued that if the gummed paper was cleared in reels, the benefit of the notification applied. Additionally, it was emphasized that the impugned product was only supplied in reel or sheet form, meeting the notification's condition.

In the judgment, the Tribunal considered the definitions of "reel" and "roll" as per I.S.I. Specification, distinguishing between a continuous web wound on a core (reel) and a continuous strip rolled around itself without a core (roll). It was concluded that the Collector (Appeals) erred in categorizing any paper in a form other than sheet as a roll. As the appellant supplied the product in sheet or reel form, the prohibition in the notification did not apply, making them eligible for the benefit.

The final decision allowed the appeal, emphasizing that the impugned product's form met the criteria for exemption under Notification No. 49/87, thereby overturning the Collector (Appeals) decision based on the incorrect interpretation of the form of the paper.