Paper-impregnated laminated sheets: concessional duty denied, but converted paper exemption survived until the exclusion date.

Paper-based decorative laminated sheets impregnated with phenol formaldehyde and melamine formaldehyde resins were treated as goods consisting of paper impregnated with plastics, bringing them within the exclusion from concessional duty under Notification No. 135/89; they were therefore not eligible to that benefit. For the earlier exemption under Notification No. 49/87, the goods were regarded as converted paper or paper board until the notification was amended to exclude paper or paper board impregnated, coated or covered with plastics compressed together in one or more operations, so the exemption remained available up to 19-3-1990.

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Issues: (i) Whether paper-based decorative laminated sheets were entitled to concessional duty under Notification No. 135/89 dated 12-5-1989. (ii) Whether the same goods were entitled to total exemption under Notification No. 49/87 dated 1-3-1987, and if so, for what period.

Issue (i): Whether paper-based decorative laminated sheets were entitled to concessional duty under Notification No. 135/89 dated 12-5-1989.

Analysis: The product was found to be manufactured by impregnating paper with phenol formaldehyde and melamine formaldehyde solutions which, on heating and pressure, become thermosetting resins and finally C-stage resin. The expression "plastics" in the notification was treated as having the same meaning as in Chapter Note 1 to Chapter 39 of the Central Excise Tariff Act, 1985. On that basis, the sheets were held to be products consisting of paper impregnated with plastics and, therefore, within the exclusion to the concessional notification. The later amendment by Notification No. 144/94 was treated as not necessary to decide the controversy under the unamended notification.

Conclusion: The goods were not eligible to the benefit of Notification No. 135/89.

Issue (ii): Whether the same goods were entitled to total exemption under Notification No. 49/87 dated 1-3-1987, and if so, for what period.

Analysis: The goods were treated as converted paper or paper board for the purpose of the exemption notification up to the date on which the notification was amended to exclude products consisting of paper or paper board impregnated, coated or covered with plastics compressed together in one or more operations. The reasoning followed earlier Tribunal decisions that had extended exemption to similar laminated or coated paper-based products before the exclusion was introduced.

Conclusion: The goods were eligible to the benefit of Notification No. 49/87 up to 19-3-1990.

Final Conclusion: The exclusion under the concessional notification applied, but the exemption for converted paper and paper board survived for the earlier period up to 19-3-1990.

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