1995(09)LCX0104
IN THE CEGAT, SPECIAL BENCH `B1’, NEW DELHI
S/Shri S.L. Peeran, Member (J) and Gowri Shankar, Member (T)
I.T.C. LTD.
Versus
COLLECTOR OF CENTRAL EXCISE, MEERUT
Order Nos. E/372-377/95-B1, dated 14-9-1995 in Appeal Nos. E/1753, 2925, 2926, 2928-2930/93-B1
Cases Quoted
Zupiter Printers v. UOI — 1991 (034) ECR 0007 (Del.) [Para 2]
Hindustan Packaging Co. v. Collector — 1994(11)LCX0059 Eq 1995 (075) ELT 0313 (Tribunal) [Paras 2, 4]
I.T.C. Ltd. v. Collector — 1994(02)LCX0024 Eq 1994 (071) ELT 0478 (Tribunal) [Paras 3, 4]
Advocated By : Shri Ravinder Narain with Ms. Sonu Bhatnagar, Advocates, for the Appellants.
Shri Mohan Lal, JDR, for the Respondent.
[Order per : Gowri Shankar, Member (T)]. - The issue for decision in these appeals is the classification of inner frames for cigarette packets manufactured by the appellant company. The department has classified these goods under sub-heading 7116.90 of the Central Excise Tariff, whereas the appellant claims that these are classifiable under Heading 7607.30 of the Tariff read with Notification 180/88.
2. Shri Ravinder Narain, Advocate for the appellant, explained that the inner frames were manufactured out of aluminium foil which is backed with paperboard. This material is received in the form of rolls. Out of these the inner frame is cut to the required size and shape. Thereafter it is perforated on both sides at the required distance from the edge, so that it can be folded at the perforation. Shri Ravinder Narain demonstrated with the assistance of samples how the inner frame is pasted to the inner side of the cigarette packet so as to provide support for the hinged lid and also helps to keep the cigarettes in place. The advocate stated that the goods are therefore nothing more than aluminium foil backed with board which is perforated and cut to shape. Therefore they were classifiable at the relevant time (1990-91) under [heading] 76.30 of the tariff. He took us through the 76.00 heading and its sub-heading in support of his argument that an aluminium foil not exceeding 0.2 mm thickness cannot discharge duty more than once. This is why there was a separate sub-heading for foil subjected to a specific process e.g. plain, embossed, coated, printed, backed. This was consistent with the wording of the main heading. He said that heading 7616.90 covered other articles of aluminium. This was therefore a residuary entry and would only be attracted after all other headings in the Chapter were excluded. Further, this heading specified in sub-heading 10 specific articles and, on the principle of ejusdem generis this particular commodity would not fall for classification in that heading. He said that in terms of the decision of the Delhi High Court in Zupiter Printers and Others v. Union of India 1991 (034) ECR 7 the goods would not be excisable at all since they were not brought or sold in the market. He, however, emphasized that this was an alternative plea and specifically requested a decision on his main plea. He also relied upon the decision of this Tribunal in Hindustan Packaging Company v. Collector of Central Excise - 1995 (075) ELT 313, in which aluminium foil not exceeding 0.15 mm in thickness was classified under Heading 7606.00 of the Central Excise Tariff.
3. Shri Mohan Lal, the Departmental Representative, stated that the goods in question were something more than a simple foil backed with board. The colour of the product was gold. Since aluminium was silvery white metal, the goods had evidently been subjected, in addition to being backed with board, to some process. Further the goods were not perforated. He argued that the Dictionary meaning of the word `perforate’ is to make a series of small holes. The goods had not been subjected to this process as would be evident by inspecting them. He relied upon the decision of this Tribunal in I.T.C. case - 1994 (071) ELT 478 in which slits for cigarette packets are classified under sub-heading 4818.90.
4. Heading 7607 and its sub-heading of the Central Excise Tariff, 1991, during the relevant period reads as follows :
Aluminium foil (whether or not printed or backed with paper, paperboard, plastics or similar backing materials) of a thickness (excluding any backing) not exceeding 0.2 mm.
7607.10 - Plain
7607.20 - Embossed
7607.30 - Perforated or cut-to-shape
7607.40 - Coated
7607.50 - Printed
7607.60 - Backed
7607.90 - Other
It is clear that the main heading covers aluminium foil of a thickness, excluding backing, not exceeding 0.2 mm whether or not printed or backed with paperboard or similar material. The competing entry, in Heading 76.16, “Other articles of aluminium” is the last entry in the Chapter and, from its wording is obviously the residuary entry. It would only come into play when an item cannot be classified under any of the other heading in the Chapter. It would be evident that if the goods are aluminium foil backed with paperboard and the thickness of the foil does not exceed 0.2 mm they would fail under Heading 76.07. There was no dispute in the proceedings below about these two facts. The claim of the Departmental Representative that because the goods have a different colour they must have been subjected to some other process is not supported by any evidence either regarding the process as to show that this act would take the goods out of this entry. In any event, this argument covers ground which was not covered in the proceedings below. The classification of the goods in Heading 7607.00 is also supported by the decision in the Hindustan Packaging decision. Aluminium foil was at the relevant time classifiable under Heading 7606.00. We agree that it is questionable whether slitting of a product in order to enable it to be folded in the manner in which it has been done amounts to perforation. However, sub-heading 30 is for foil, “perforated or cut to shape.” There is no dispute that the goods have been cut to shape. The reliance by the Departmental Representative on the decision in the I.T.C. case is of no help to him. The goods in that case were not made out of foil. As rightly pointed out by the advocate, Chapter 48 would not apply to foil by virtue of note (1) to that Chapter. We note that the gate pass for the rolls of foil out of which the product is cut to shape also shows the foils to have been classified under Heading 7606.00.
5. The goods would therefore be classifiable under Heading 7607.30. They would also be entitled to the benefit of Notification 180/88 under entry 14 or entry 15.
6. Since the appeals succeed on this point we do not consider it necessary to give a finding on the alternative plea of the advocate. The appeals are accordingly allowed.
Equivalent 1995 (80) ELT 291 (Tribunal)