1993 (9) TMI 131 - SC - Central Excise

Court upholds denial of exemption for corrugated board under Central Excise Act

The Court dismissed the appeal, upholding the authorities' decision to deny the benefit of an exemption under Notification No. 208/67 to the appellant, as ... Whether corrugated board is included within the expression 'paperboard' occurring in Notification No. 225/67? Held that:- According to the various publication 'corrugated Fibreboard' is described as Board consisting of one or more sheets of fluted paper stuck to a flat sheet of paper or board between several sheets, usually of kraft. Reference is also made to BS 1133 (Section 7 : 1967) Packaging Code. Even this Code says that corrugated fibreboard defined in BS 3130 is a corrugated (fluted) sheet of paper or paperboard affixed on both sides with flat paper, usually kraft, called the facing (liner). To the same effect is the statement in the British Standard Glossary of Packaging Terms sub-section 12.6 Fibreboard. The corrugated fibreboard is defined as 'a corrugated (fluted) sheet of paper or paperboard, faced on both sides with flat paper, usually kraft, called the `liner''. The material relied upon by the appellant does not appear to support his contention that corrugated board is not paperboard. Indeed, it tends to establish to the contrary. Appeal dismissed. Issues:1. Interpretation of Exemption Notifications under the Central Excise Act.2. Determination of whether corrugated board falls under the definition of 'paperboard' in Notification No. 225/67.Analysis:The case involved an appeal against the dismissal of a revision petition filed by the appellant under Section 36 of the Central Excise Act regarding the benefit of an Exemption Notification. The appellant, engaged in manufacturing corrugated boards, was availing the benefit of Notification No. 135/67. A subsequent Notification, No. 208/67, exempted the first 1000 metric tonnes of paper from duty. However, Notification No. 225/67 excluded paperboards from the exemption, leading to a dispute over whether corrugated board fell under the term 'paperboard' in the latter notification.The Court examined the definitions and provisions of the relevant notifications and tariff items. It noted that while the term 'paperboard' was not explicitly defined, the structure of Tariff Item No. 17 indicated that corrugated board could be considered a type of paperboard. Subsequent sub-items in the tariff item referred to specific types of paper, including corrugated board, suggesting that corrugated board was encompassed within the broader category of paperboard. The authorities were deemed correct in treating corrugated board as paperboard under Notification No. 225/67.The appellant's counsel presented literature definitions attempting to show that corrugated board did not fall under the definition of paperboard. However, the Court found that the definitions cited, such as those from the British Standard Glossary of Packaging Terms and other publications, actually supported the authorities' interpretation that corrugated board was indeed a type of paperboard. The Court concluded that the appellant's arguments lacked merit based on the definitions and standards provided in the literature.Ultimately, the Court found no substance in the appellant's appeal and dismissed the appeals, with no costs awarded. The judgment upheld the authorities' decision to deny the benefit of the exemption under Notification No. 208/67 to the appellant based on the interpretation that corrugated board fell within the scope of 'paperboard' as per Notification No. 225/67.This detailed analysis of the judgment highlights the key legal issues, the interpretation of relevant provisions, and the reasoning behind the Court's decision regarding the classification of corrugated board under the Central Excise Act's Exemption Notifications.