2019 (6) TMI 1065 - AT - Central Excise

Tribunal rules in favor of appellant, exempting branded printed items from tax under Chapter 49.

BOX CORUGATORS & OFFSET PRINTERS Versus COMMR. OF CGST, C. EX. & CUS., BHOPAL

The Tribunal ruled in favor of the appellant, holding that the printed items with specific branding fell under Chapter 49, attracting a nil tax rate. The ... Classification of goods - printing ‘duplex board and kraft paper’ - whether fall under Chapter 48 or 49 of the First Schedule to the Central Excise Tariff Act, 1985? - HELD THAT:- The items in dispute being registers, answer sheets, certificates, writing pads, books, receipts, school diaries, school prospectus etc., are all printed with name and logo of particular organisations. Accordingly by virtue of Chapter Note 12 to Chapter 48, these items will fall in Chapter 49 being goods of printing industry - We find that not a single RUD, is in form of stationery which is meant for general use. The appellant is not liable to Excise duty as the items in dispute printed by them fall under Chapter 49 and the tax rate under CETH Chapter 49 is nil - appeal allowed - decided in favor of appellant. Issues:Classification of products under Chapter 48 or 49 of CETA, eligibility for SSI exemption, marketability of printed items.Classification Issue Analysis:The appellant, engaged in manufacturing articles of paper and paper boards, disputed the classification of their products as per the Revenue's finalization. The dispute mainly revolved around items like letter pads, registers, folders, and other printed materials. The Ld. Commissioner accepted the classification of folders under CETH 4911 but disallowed classification of other items under Chapter 48. The Tribunal analyzed the products and found that they were all printed with specific logos, motifs, and names of particular organizations, falling under Chapter 49 as per Chapter Note 12 of Chapter 48. As none of the items were for general use, the Tribunal held that the appellant was not liable to Excise duty as the items fell under Chapter 49, which had a nil tax rate.Eligibility for SSI Exemption Issue Analysis:The appellant availed SSI exemption under Notification No. 8/2003 and also benefits under Notification No. 214/86. The Adjudicating Authority allowed the SSI exemption and exemption for job work but imposed duty for certain years where the SSI limit was exceeded. However, the Tribunal found that the appellant was eligible for SSI exemption for the earlier years and accordingly set aside the duty imposed for those years.Markettability of Printed Items Issue Analysis:The appellant argued that the printed stationery items containing specific client names, motifs, and logos were not marketable and, therefore, not excisable. The Tribunal considered this argument along with the classification issue and concluded that the items falling under Chapter 49 with specific branding were not liable for Excise duty. As a result, the impugned order was set aside, and the appellant was entitled to consequential benefits as per the law.In conclusion, the Tribunal ruled in favor of the appellant, holding that the printed items with specific branding fell under Chapter 49, attracting a nil tax rate. The appellant was found not liable for Excise duty, and the impugned order was set aside, granting them consequential benefits.