2015 (10) TMI 443 - SC - Central Excise

Classification of goods - Classification of printed thermal paper rolls - Classification under Chapter Heading 49.01 or under Head 4811.90 - Held that - As per the assessee, it is essentially printing work which is done by the assessee relating to the product in question and, therefore, the product comes under Chapter Heading 49.01 which pertains to printing - insofar as the assessee is concerned, it is undertaking the work of printing alone and is supplying to those who place orders in this behalf. The end use of the said product at the hands of the purchaser is not the concern of the assessee and cannot be the consideration for classifying the goods in question. It is the respondent which is to be assessed under the Central Excise Act and it has to pay the excise duty on the manufacturing process undertaken by it - description of the work done by the assessee makes it clear that it is the printing which it is undertaking and, therefore, it is rightly classified under Chapter Heading 49.01. Merely because the thermal paper rolls are the raw material used which is imported or which is cut to different sizes, would not be relevant factor in determination of the classification. - Decided against Revenue.

Issues involved: Classification of "printed thermal paper rolls" under Chapter Heading 49.01 or 48.11 of the Central Excise Tariff Act, 1985.

Analysis:
In the case at hand, the primary issue revolves around the classification of the product "printed thermal paper rolls" manufactured and cleared by the respondent. The respondent asserts that the correct classification is under Chapter Heading 49.01, which pertains to printed books and products of the printing industry. On the other hand, the Department argues that the proper classification should be under Head 4811.90, which covers paper and paperboard coated, impregnated, or printed. The critical contention is whether the process undertaken by the assessee primarily involves printing work, as claimed by the respondent, or if other factors should determine the classification.

Upon examining the manufacturing process described by the Company's Director, it is evident that the main raw material used is one side coated thermal paper, which is then subjected to printing as per the buyers' requirements. The process involves printing on the uncoated side of the thermal paper, with the coated side remaining blank or having the buyer's monogram printed as background. The rolls are subsequently cut, slit into smaller rolls, and packed for sale. The key aspect highlighted is that the assessee is primarily engaged in printing activities and supplies the printed rolls to customers based on their orders. The end use of the product by the purchaser is deemed irrelevant for classification purposes, emphasizing that the focus should be on the manufacturing process undertaken by the respondent.

The description of the work carried out by the assessee underscores the printing nature of the activities, leading to the rightful classification under Chapter Heading 49.01. The fact that thermal paper rolls are utilized as raw material or undergo size modifications does not alter the classification criteria. The judgment cites precedents such as 'Headway Lithographic Company v. CCE, Kolkata' and 'Holostick India Ltd. v. CCE, Noida' to support the classification based on the nature of the manufacturing process. Consequently, the appeal is dismissed, affirming the classification under Chapter Heading 49.01.

In a related matter encompassing appeals concerning the manufacturing process involving printing on ordinary paper, the decision in Civil Appeal No. 285 of 2007 is upheld, resulting in the dismissal of these appeals as well. This reaffirms the importance of the printing process in determining the classification of products under the Central Excise Tariff Act, 1985.

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