Essential character controls excise classification, and a mere aluminium component did not make the product a container.

Excise classification depends on the article's essential commercial and functional character: a lipstick component made of a plastic body with an aluminium sleeve did not become a container merely because one part was metallic, because the sleeve did not itself perform the containment function. The goods were therefore not classifiable as containers under Item 27(f). The duty demand for the earlier period was also held time-barred, as the demand covering 1971 to 1974 was raised in 1976 and failed for want of limitation. On that basis, the revision succeeded, and the demand and penalty did not survive.

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Issues: (i) Whether the goods manufactured by the petitioners were classifiable as containers under Item 27(f) of the Central Excise Tariff merely because they contained an aluminium sleeve; and (ii) whether the duty demand for the earlier period was barred by limitation under the Central Excise Rules.

Issue (i): Whether the goods manufactured by the petitioners were classifiable as containers under Item 27(f) of the Central Excise Tariff merely because they contained an aluminium sleeve.

Analysis: The relevant test was whether the article, in substance, performed the function of a container ordinarily intended for packaging goods for sale. The aluminium sleeve was only a hollow tube with both ends open and did not, by itself, hold the lipstick or perform the essential function of a container. The body made of plastic was the essential part of the product, and the sleeve served only as a component or decorative piece. On that basis, the goods could not be treated as containers merely because one component was made of aluminium.

Conclusion: The goods were not classifiable as containers under Item 27(f) of the Central Excise Tariff.

Issue (ii): Whether the duty demand for the earlier period was barred by limitation under the Central Excise Rules.

Analysis: The Government accepted the contention that the demand, covering the period 1971 to 1974 but raised in 1976, attracted the plea of time bar. The record disclosed sufficient force in the objection that the demand was not sustainable for want of timeliness under the applicable rules.

Conclusion: The duty demand was barred by limitation.

Final Conclusion: The revision succeeded, the appellate order was set aside, and the demand and penalty did not survive.

Ratio Decidendi: For excise classification, an article must be judged by its essential commercial and functional character, and a mere component which does not itself perform the function of packaging or containment cannot make the goods a container; a duty demand must also conform to the applicable limitation period.

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