2018 (11) TMI 293 - AT - Central Excise

Manufacture - process of manufacture of printed plastic pouches and printed laminated plastic films, out of films purchased from the market - NIL rate of duty under Tariff Item No.4911 of the Central Excise Tariff Act, 1985 - Held that - The issue is no more res-integra and is decided in the case of M/S ESSAR PACKAGING PVT. LTD. & SHRI ATUL GOEL VERSUS COMMISSIONER OF CENTRAL EXCISE AND S.T., ALLAHABAD 2017 (6) TMI 368 - CESTAT ALLAHABAD , where it was held that The printed poly films do not attract Central Excise duty, further till 09.05.2008 laminated printed poly films did not attract Central Excise duty. Further, wef. 10.05.2008, printed laminated poly films fall under Tariff Item No.4911 and attract nil rate of duty. Demand set aside - appeal allowed - decided in favor of appellant.

Summary

Issues: Classification of printed laminated plastic films under Central Excise Tariff Act, 1985 and applicability of SSI Exemption.

Classification Issue:
The appeal arose from an Order-in-Original passed by the Commissioner of Customs, Central Excise & Service Tax, Allahabad, regarding the classification of printed plastic pouches and printed laminated plastic films. The appellants classified plastic pouches under Chapter 39 and laminated plastic films under Chapter 49 of the Central Excise Tariff Act, 1985. The revenue contended that the printed laminated plastic films should also be classified under Chapter 39, leading to a demand for Central Excise duty of approximately ?58 lakhs for the period from 2006-07 to 2010-11. The Original Authority upheld the revenue's classification and imposed penalties. The appellant challenged this decision before the Tribunal.

Analysis:
During the hearing, the appellant's counsel argued that the issue had already been settled by a previous decision of the Tribunal in the case of M/s Essar Packaging Pvt. Ltd. vs Commissioner of Central Excise & Service Tax, Allahabad. The Tribunal in the cited case held that printing of poly films did not attract Central Excise duty as it did not amount to manufacture. The appellant contended that their activity of printing and laminating should be treated as manufacturing, attracting NIL Central Excise duty under Tariff Item No. 4911. The revenue's representative agreed that the issue was covered by the Tribunal's previous decision.

Decision:
After considering the arguments and reviewing the records, the Tribunal found that the issue was no longer res-integra based on the precedent set by the Tribunal in the case of M/s Essar Packaging Pvt. Ltd. The Tribunal reiterated the findings of the previous case, stating that printed laminated plastic films fall under Tariff Item No. 4911 and attract NIL Central Excise duty from 10.05.2008 onwards. The Tribunal set aside the Order-in-Original, ruling in favor of the appellant and granting consequential relief. The Tribunal held that the activity of printing and laminating constituted manufacturing, but attracted nil rate of duty from 10.05.2008 onwards as per the precedent decision.

Conclusion:
In conclusion, the Tribunal classified the printed laminated plastic films under Tariff Item No. 4911, exempting them from Central Excise duty starting from 10.05.2008. The Tribunal's decision was based on the interpretation that the printing and laminating activity amounted to manufacturing and fell under a tariff item attracting nil duty. As a result, the impugned order was set aside, and the appeal was allowed with consequential relief granted to the appellant.