2016(12)LCX0083

IN THE CESTAT, PRINCIPAL BENCH, NEW DELHI [COURT NO. I]

Justice Dr. Satish Chandra, President and Shri V. Padmanabhan, Member (T)

PRAKASH INSCRIPT INNOVATIONS PVT. LTD.

Versus

COMMR. OF CUS., NEW DELHI (ICD TKD)

Final Order No. C/A/56075/2016-CU(DB), dated 26-12-2016 in Appeal

Cases Quoted -

Metagraphs Pvt. Ltd. v. Collector- 1996(11)LCX0034 Eq 1996 (088) ELT 0630 (S.C.) - Relied on [Para 4]

Advocated By -

Ms. Cham Bansal and Ms. ji/oti Pal, Advocates, for
the Appellant.
Shri R.K. Manjhi, AR,for the Respondent.

[Order per : V. Padmanabhan, Member (T)]. -

The appeal is directed against the order-in-appeal dated 6-8-2013. The appellant imported 'Graphis-tone-Love in 100 languages (3 MM glass crystal having images or text engraved)' by declaring total assessable value Rs. 1,71,509/- and by classifying under Customs Tariff Heading (CTH) 4911 99 90. On scrutiny of sample received from the Shed on 1st check examination, it was found that the same was a tiny glass square crystal (3 sq. mm size) with an image or illustration engraved on one of its flat surface affixed with very thin layer of some metal. Further, the image or illustration could be seen with the help of a lens (the lens was also found affixed onto the sample). On scrutiny of the sample of the "imported item", it was found that it was tiny glass crystal (3 sq. mm size) with an image or illustration engraved. Customs took a view that the goods were not classifiable under Chapter 49 being not printed material. The Deputy Commissioner of Customs in his original order dated 3-12-2012 decided the classification of the imported goods under CTH 7018 90. This order was challenged before Commissioner (Appeals) who approved the classification as done by the lower authorities. Aggrieved by the said decision, the present appeal has been filed.

2. The contention of the appellant is that the imported goods are classifiable under Chapter 49 (4911). Their submission is that the imported product -graphistone - acquires essential character by the printing on crystal embedded within it by using nano-technology. Micro-copies of text has been engraved on a tiny crystal which is made visible by use of small lens which is attached to the glass bead. According to them, the CTH 4911 includes the printed items which are not specifically covered under other headings of Chapter 49.

3. We have heard Ms. Charu Bansal and Ms. Jyoti Pal, learned advocates appearing for the appellants and Shri R.K. Manjhi, learned DR appearing for the Revenue.


4. Learned Counsel relied upon the decision of Hon'ble Supreme Court in the case of Metagraphs Pvt. Ltd. v. Collector of Central Excise, Bombay [1996(11)LCX0034 Eq 1996 (088) ELT 0630 (S.C.)l in which the Apex Court has held that if printing brings into existence a product and if printing is not merely incidental to its use but is primary, then the resultant product would be a product of printing industry.

5. Learned DR supported the orders passed by the authorities below. He vehemently opposed the classification under Chapter 49 which according to him is applicable only to products of printing industry, such as printed books, newspaper, pictures, etc. He submitted that literature pertained to graphistone clarifies that the use of the product is predominantly in jewellery, classification of which falls under Chapter Heading 70.18. It is the contention that the imported articles is predominantly made of glass. The fact that the imprinted crystal is embedded into a product, make it a product of printing industry.


6. The imported goods which are prescribed as graphistone comprises of a tiny crystal on which certain text is engraved. These microcopies are supported by a 3 mm borosilicate glass to enable viewer to read all the text printed and engraved on crystal. The small lens magnified the image. The text is en graved with the help of nano-technology.
The competing entries for classification are under Chapter 49, which deal with the printing material and Chapter 70, which covers articles made of glass. Chapter 49 covers printed books, brochures, leaflets and similar printed matter and other products of printing industry. The appellant has sought classification under Chapter 49 as other printed product.

7. We have perused the samples of imported product. The crystal has a certain text printed on it with the help of nano-technology. This is visible through a thin lens attached to graphistone which magnifies the image for easy viewing. Chapter 49 covers products of printing industry. In the case law cited by the appellant, the Hon'ble Supreme Court has held that for a product to be classified under Chapter 49, printing of the label should not be merely incidental to the products' use but should be the primary use. The nature of the product is such that it finds use primarily in ornaments and is made essentially of glass. It is evident that printing is only incidental to the use of the product in jewellery. Consequently, we rule out classification of the product under Chapter 49.

8. This product is made of high quality borosilicate glass on which an engraved crystal is attached on one side and on the other side a magnifying lens is attached. Hence, the most obvious classification of the product would be under Chapter 70 covering glassware. The CTH 7018, where the department has classified the imported goods which covers a range of widely diversified glass articles most of which are used, directly or after further processing, for ornamental or decorative purposes. When we look for rules for classification (which is a part of Customs Tariff), we find that Rule 3(a) deals with the classification of goods consisting of more than one material or substance which provides for classification under the heading which provides the most specific description. We find that this rule is not relevant inasmuch as no specific description is found in the tariff. Next we turn to Rule 3(b), which covers classification of mixtures, and composite goods consisting of different materials or made up of different components. This requires classification to be made as though the composite goods consists only of material which gives them their essential character. In the present item, the goods are made of a metal piece printed with a motif on a crystal which can be seen with the help of a lens. The essential character of this composite article is that of glass. Consequently, the classification under Chapter 70 would be most appropriate. The classification under Chapter sub-heading 7018 90 as done by authorities below is approved and that under Chapter 49 is rejected.

9. In view of the above, we find no reasons to interfere with the im
pugned order which is upheld and appeal dismissed.
(Pronounced in the open Court on 26-12-2016)

Equivalent 2017 (349) ELT 0168 (Tri. - Del.)