Laminating duty-paid kraft paper with polyethylene amounts to manufacture and attracts central excise duty on the processed product.

Laminating duty-paid kraft paper with polyethylene was treated as manufacture for central excise purposes because the processing converted the paper into a distinct excisable commodity within the tariff entry for paper subjected to coating or similar treatment. Applying Supreme Court authority on treatment of paper, the Tribunal held that the laminated product remained liable to duty under Tariff Item 17(2). The impugned order was set aside and the appeal succeeded, with the processed laminated paper held exigible to duty.

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Issues: Whether laminating duty-paid kraft paper with polyethylene amounts to manufacture and attracts Central Excise duty under Tariff Item 17(2).

Analysis: The process of treatment of paper had already been treated as manufacture in the Supreme Court authorities considered by the Tribunal. Applying that line of authority, the laminated product was regarded as a distinct excisable commodity falling within the scope of the tariff entry covering paper subjected to treatment such as coating or similar processes.

Conclusion: Laminating duty-paid kraft paper with polyethylene amounts to manufacture and is again liable to Central Excise duty under Tariff Item 17(2), in favour of the Revenue.

Final Conclusion: The impugned order was set aside and the appeal succeeded, with the laminated paper held exigible to duty.

Ratio Decidendi: A process that materially treats paper so as to bring the resulting product within the relevant tariff entry constitutes manufacture for central excise purposes and attracts duty on the processed product.

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