TaxTMI 
TaxTMI 
1994 (11) TMI 218
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....Classification List No. 1/89 w.e.f. 20-10-1989 has been finally approved under this heading. 2. The Asstt. Collector in the order-in-original has held that the subject product gives the essential character to the cigarettes, without which the filter tipped cigarettes will not be complete. The Asstt. Collector has held, relying on the assessee's admission that the process carried out by the party on the duty paid base paper is a printing process called `MOTLEY', whereby dots appear on the base paper. The essential character of this paper, i.e., non-porous nature is not imparted by this process, and hence the Asstt. Collector has held that it cannot be called conversion. Observing the function of the product, the Asstt. Collector has held :- "In filter tipped Cigarettes there are two portions. One is the tobacco mass and the other is the filter mass. The former has to burn but the filter mass should not burn, otherwise it will burn the fingers of the smokers. The two masses have to be wrapped in paper to make a Cigarette. Tobacco mass has to be wrapped in porous paper so that oxygen can reach it to keep it to burn, whereas filter mass, which should not burn is to be wrappe....
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....is context rely on the ruling of the Hon'ble Supreme Court as rendered in the case of Dunlop India v. U.O.I. [1983 (13) E.L.T. 1566 (SC)] and that of the Tribunal ruling rendered in the case of Goodlass Neurolac Paints v. C.C.E. [1992 (60) E.L.T. 392]. It is pleaded that Tariff Entry 48.11 does not mention that surface decorated paper, if used for wrapping the filter mass would be cigarette paper under 4813.00. It is stated that physical character of the paper evidently manifests the use to which it is put to and therefore, its use does not change by surface decorating it. It is stated that in long past Cork was used as a `tip' to one end of the Cigarette and the paper which wrapped it was called cork-tipped paper or C.T. paper i.e. tipping paper. It is stated that though Cork has long been replaced by filter, the paper wrapping the filter continues to be called C.T. paper (Cork Tipped Paper) in the industry and the trade. Cork used to have dots which was reflected on the paper wrapping it. It is stated that, it was for this reason that when filter replaced the cork, the paper wrapping the filter has been surface decorated by a process called 'Motley' so that dots appear on the pap....
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....itted that the plea for classification of the product under the residuary Item 4811.90 as 'other' under the main description of the Tariff heading "paper, paper-board, Cellulose wadding and Webs of Cellulose fibres, coated, impregnated, covered, surface-coloured, surface decorated or printed, in rolls or sheets, other than goods of Heading Nos. 48.03, 48.09, 48.10 or 48.18" is justified. He submitted that the Heading 48.13, which reads, "Cigarette paper, whether or not cut to size or in the form of booklets or tubes", is not an appropriate heading, as the paper is not Cigarette paper. He submitted that the item is supplied to them by ITC and Triveni Tissues, and it is referred as Cigarette Tissues. It has special quality and it is a fine paper, odourless, porous, combustible, and it has its own specification, which is different from that of the other papers. He submitted that both sides had not produced any evidence on Trade understanding or Trade opinion. He submitted that the onus of classification is on the department and that they had not discharged the same. He submitted that the process of `Motley' does not convert the cigarette-tissue into a `Cigarette Paper', and that the p....
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....tte Paper'. The character of the paper has changed after the printing as the transparency of the paper has changed, after the process of Printing. He submitted that there is no definition in ISI for `Cigarette Paper'. He submitted that the process of printing does amount to the process of manufacture and in this context relied on the ruling of Vimla Printers v. CCE, reported in 1993 (66) E.L.T. 231 and that of U.O.I. v. Bata India, reported in 1993 (68) E.L.T. 756. He submitted that the items shown in the Tariff, would be deemed to be marketable, unless otherwise shown by the assessee and that burden is on the assessee and that the same has not been discharged by them. He submitted that the paper received by the assessee were classified under sub-heading 4805.90 as `Uncoated Paper under Rolls or Sheets' and after the `Motley' process, they would be rightly classifiable as `Cigarette Paper', based on their use to which it is put. He submitted that the use in manifest in the Tariff itself, and hence the question of not considering the end-use does not arise at all. Therefore, the end-use in this particular case is certainly relevant. He pointed from the definition relied by the ld. A....
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.... it does bring a physical change, but that change does not make it a `Cigarette Paper' to be classified under Heading 48.11. They contend that end-use is not the criteria for classification and HSN Explanatory Note is not applicable and that department has not considered the Trade and Commercial understanding of the product. In this context definition of the 'Cigarette Paper' as appearing in the various Texts, as mentioned, is relied. 14. The definition of `Cigarette Mouth Piece Paper', `Cigarette Paper' as appearing at Page 118 of `The Dictionary of Paper' published by American Paper and Pulp Association, is reproduced hereunder :- "Cigarette Mouthpiece Paper : A soft, flexible paper, made of flax and/or bleached chemical wood pulps, of a basis weight of 80 to 90 pounds used for the tips of cigarettes. "Cigarette Paper : A strong tissue paper of close, uniform texture, free from pinholes, used as a wrapper for tobacco in manufacture of cigarettes. It is generally made from flax pulp (see Chapter Two, p. 27) and contains no size. This paper may be either combustible or non-combustible. Combustible paper is also called free burning paper, contains from about ....
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....inion would be only a delusive guide and it cannot be sufficient to decide the matter in one way or the other. The Deptt. has to send the samples of the product after `Motley' process for Technical and Trade opinion and counter the same to the assessee for a reply. Only thereafter, the matter can be adjudicated keeping in view the HSN Expl. Notes, which indeed has a persuasive value. If the trade recognises the product as a different one after Motley process, and the identity of Cork-tipping has been lost after the process, then indeed a process of manufacture has occurred. This has to be examined in the light of evidence and ruling of the Hon'ble Supreme Court in the case of Laminated Packaging's case. The ld. Collector, has remanded the matter for considering the grant of benefit of Notification to the original authority. We are of the opinion, that the order of Collector (Appeals) on classification be also set aside and the issue is also remanded to the Asstt. Collector for de-novo consideration in the light of our observation. Thus the appeal is allowed by remand. 17. [Order per : S.K. Bhatnagar, Vice President]. - With due respects to Hon'ble Member (J) my views and or....