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TMI Blog2024 (7) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... ON LTD. VERSUS COLLECTOR OF CENTRAL EXCISE, BOMBAY-II [ 1997 (7) TMI 138 - SUPREME COURT] had considered whether paper printed labels would be eligible for exemption as a product of printing industry and held the issue in favour of the assessee. The Ld. A.R produced the decision in the case of ITC. LIMITED VERSUS COLLECTOR OF CENTRAL EXCISE, MADRAS [ 1997 (12) TMI 115 - SC ORDER] . In the said case, the issue that was under consideration was with regard to the paper / paperboard articles used for packaging of cigarettes which also contained printed matter. After considering both the competing classifications under Chapter Heading 48 as well as 4901.90, it was held that since the primary use of the articles being in connection with the packaging of cigarettes and the printing there being merely incidental to the primary use, the goods are correctly classifiable under Chapter 48 of the Tariff Act, 1985 - This decision would clearly bring out the distinction between the printing which is merely incidental as well as that of primary use and therefore would substantiate our view that the printing being of primary use in printed label, the impugned products in the present case are classi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CTH 48.21 and confirmed the demand of Rs.11,76,463/- along with interest. Aggrieved by such order, the appellant has filed the present appeal. 5. The Ld. Counsel Shri J. Shankarraman appeared and argued for the appellant. It is submitted that the appellant contends that the goods are classifiable under Chapter Heading 4901.90 of the Central Excise Tariff Act, 1985 attracting NIL rate of duty whereas the department contends that printed paper labels fall under Heading CETH 48.21 attracting 16% ad valorem during the relevant period. 5.1 The show cause notice dated 19.03.2003 for the period from 08.03.2002 to 30.11.2002 proposed to classify the goods under CETH 4821 and demanded duty of Rs.46,38,324/- for the clearances effected from 05.04.2002 till 30.11.2002 along with interest thereon. Further the show cause proposed to appropriate the sum of Rs.3,92,991/- already paid by the appellants. The adjudicating authority confirmed the entire demand in the show cause notice, in terms of Order Original No. 37/2003 dt.17.12.2003. The Commissioner (Appeals) then passed Order-in- Appeal No. 32/04 dated 18.06.2004 classifying the paper printed labels under chapter heading 48.21 but reduced the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tagraphs Pvt. Ltd. Vs. Collector of Central Excise, Bombay 1996 (88) ELT 630 (SC) and in Johnson Johnson Ltd. Vs.Collector of Central Excise, Bombay-II 1997 (94) ELT 286 (SC). Following the said decisions and for the reasons stated therein, this appeal is allowed and it is held that the cloth printed labels, aluminium foil printed labels, film printed labels and paper printed labels are eligible for exemption as a product of the print industry. 5.7 It will also be relevant to rely upon the decision of the Hon ble Tribunal in the case of CCE -Vs- Johnson Johnson Ltd.- 2016 (343) ELT 657 (T) wherein it was held as follows: 4. We have gone through the ground of appeal as also order of the Hon ble Supreme Court. Printed paper labels classification was not under dispute and the said entry is chargeable to NIL rate of duty under Notification No. 228/86, dated 3-4-1986. In the appeal Hon ble Supreme Court has held that in addition to the other type of labels, printing paper label is product of printing industry and therefore chargeable to NIL rate of duty. The said product is therefore not chargeable to duty. Accordingly appeal filed by the Revenue is dismissed. 5.8 The decision of the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The main contention of the department is that since CETH 4821 specifically mentions paper or paperboard labels of all kinds whether or not printed, the goods manufactured by the appellant would fall under the said heading. However, Section Note 11 states that when the printing is not merely incidental but for primary use of the goods such goods would fall under Chapter 49. In the present case, the appellant has stated that they do not manufacture paper or paperboard and that they do only the printing on the labels, according to the customers requirement. Thus it cannot be said that the printing is merely incidental. The printing on the goods clearly shows the nature of the goods and therefore would merit classification, in our view, under Chapter 49. 9. The primary use of the goods is known to be as printed labels and the product would then be correctly classifiable as a product of printing industry falling under 4901.90 as argued by the appellant. 10. The Tribunal in the case of Lovely Offset Printers Vs CCE Tirunelveli - 2018 (8) G.S.T.L 53 (Tri.-Mad) had occasion to consider the very same issue of classification of printed paper labels. The Tribunal followed the decision in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d labels would be eligible for exemption as a product of printing industry and held the issue in favour of the assessee. The relevant paragraphs reads as under : 2. The dispute before us is only in relation to Printed plastic labels, Printed cloth labels and Printed aluminium labels. In regard to Printed paper labels, there is no dispute before the Tribunal either and that part of the order of the Tribunal in relation thereto has now become final. Insofar as other items are concerned the same are covered by decisions of this Court in Metagraphs Pvt. Ltd. v. Collector of Central Excise, Bombay - 1996 (88) E.L.T. 630 (S.C.) and in Johnson Johnson Ltd. v. Collector of Central Excise, Bombay-II - 1997 (94) E.L.T. 286 (S.C.). Following the said decisions and for the reasons stated therein, this appeal is allowed and it is held that the cloth printed labels, aluminium foil printed labels, film printed labels and paper printed labels are eligible for exemption as a product of the print industry. 12. The said decision was followed in the case of CCE Vs Mumbai II Vs Johnson Johnson Ltd. - 2016 (343) ELT 657 (Tri.-Bom.) wherein it was held that the printed paper labels are chargeable to NIL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... produced the decision in the case of I.T.C. Limited Vs Collector of Central Excise, Madras 1998 (97) E.L.T 401 (SC). In the said case, the issue that was under consideration was with regard to the paper / paperboard articles used for packaging of cigarettes which also contained printed matter. After considering both the competing classifications under Chapter Heading 48 as well as 4901.90, it was held that since the primary use of the articles being in connection with the packaging of cigarettes and the printing there being merely incidental to the primary use, the goods are correctly classifiable under Chapter 48 of the Tariff Act, 1985. This decision would clearly bring out the distinction between the printing which is merely incidental as well as that of primary use and therefore would substantiate our view that the printing being of primary use in printed label, the impugned products in the present case are classifiable under Chapter heading 4901.90 of CET Act, 1985. 14. From the discussions made above, we hold that the impugned products fall under Chapter Heading 4901.90 as products of printing industry and attract NIL rate of duty. The demand of duty therefore cannot sustain. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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