Berger Paints India Ltd. vs Commissioner of Central Excise, Calcutta-II>2000(07)LCX0101

2000(07)LCX0101

IN THE CEGAT, EASTERN BENCH, KOLKATA

Mrs. Archana Wadhwa, Member (J) and Dr. S.N. Busi, Member (T)

BERGER PAINTS INDIA LTD.

Versus

COMMISSIONER OF C. EX., CALCUTTA-II

Order Nos. A-884, 885, 886-CAL/2000, dated 7-7-2000 in Appeal Nos. E-1486/85, E-1528/85 & E-1529/85

Cases Quoted

Advance Paints v. Collector — 2000(01)LCX0158 Eq 2000 (125) ELT 0812 (Tribunal) — Distinguished.......... [Para 7]

Commissioner v. Berger Paints India Ltd. — 1997(01)LCX0092 Eq 1997 (093) ELT 0100 (Tribunal) — Followed. [Para 5]

Commissioner v. Kalinga Paints & Chemical Industries —1987(07)LCX0107 Eq 1989 (044) ELT 0548 (Tribunal) — Followed [Para 5]

Commissioner v. Shalimar Paints Ltd. — Order Nos. A-777-778/CAL/1997, dated 10-7-1997 — Followed [Para 5]

Advocated By : S/Shri Vasant Subramanyam, Consultant & K.K. Banerjee, Advocate, for the Appellants.

Shri R.K. Roy, JDR, for the Respondent.

[Order per : Archana Wadhwa, Member (J)]. - The appeal of M/s. Berger Paints and two other appeals appearing at Serial Nos. 2 & 3, filed by the Revenue against a common impugned Order passed by the Commissioner of Central Excise (Appeals) dated 18-12-1984 in the case of Jenson & Nicholson (I) Ltd., are being taken together for disposal as the issue involved in these three appeals is the same.

2. The short question required to be decided in the first appeal of M/s. Berger Paints is as to whether the Dual Pack consisting of Aluminium Paste brought by the appellants and the Medium manufactured by them and placed together in a container for being used as Ready Mixed Paints, would be again leviable to duty as Aluminium Paste and classifiable under the erstwhile Tariff Heading : 14-I(3)(iii). The authorities below had directed the appellants to charge the Dual Packing under the said Tariff attracting 15% ad valorem rate of duty and accordingly, they have confirmed the duty of Rs. 7,505.70.

3. In the two other appeals of the Revenue, the Commissioner has dropped the demand of duty of Rs. 17,716.11 raised against them for the period prior to 1986, by holding that at the time of clearance from the factory, Aluminium Paste and the Medium placed in one container, cannot be held to be Aluminium Paint classifiable under the erstwhile Tariff Item : 14-I(5) inasmuch as the same are not mixed and in a ready-to-use condition at the time of their clearance.

4. We have heard Shri Vasant Subramanyam, learned Consultant for the appellants, M/s. Berger Paints and Shri R.K. Roy, learned JDR for the Revenue in A. No. E-1486/85. On the other hand, we have heard Shri Roy, learned JDR for the Revenue and Shri K.K. Banerjee, learned Advocate for the respondent firm, M/s. Jenson & Nicholson in A. Nos. E-1528-1529/85.

5. It is seen that the issue is no more res integra and vide Tribunal's Order Nos. A-777-778/CAL/1997 dated 10-7-1997, the appeal filed by the Revenue against an Order of the Commissioner (Appeals) in favour of M/s. Shalimar Paints Ltd., was rejected, following the Tribunal's Order Nos. A-71 & 72/CAL/97 dated 21-1-1997 in the case of C.C. Ex., Calcutta-II v. M/s. Berger Paints India Ltd. [1997(01)LCX0092 Eq 1997 (093) ELT 0100 (Tribunal)]. It has been held in the above two cases that packing of Aluminium Paste and Varnish in a Dual Container, does not amount to manufacture of a new commodity. As such, it was held that there was no question of payment of duty on the goods so packed and cleared from the factory of the respondents. Question of classification, therefore, does not arise. The above decisions were based upon the earlier decision of the Tribunal in the case of Commissioner of Central Excise v. Kalinga Paints & Chemical Industries reported in 1987(07)LCX0107 Eq 1989 (044) ELT 0548 (Tribunal). Para 4 of the said order reads as follows :-

“4. We observe that the only product that the appellants were manufacturing in their factory was aluminium medium. After paying duty on the same, they cleared it and put this in a separate packing along with the packed aluminium paste in respect of which the duty had already been paid and put the two in a common container for the purpose of marketing. The operation of putting the two materials separately, it is not denied, has been carried out outside the factory. It has not been shown to us that putting these separately manufactured products in a common container, amounts to manufacture. It may well be a final product for a particular consumer end-use emerges after the two are mixed, but until it has been done, it has to be shown as to whether under the law by putting the two items together separately packed condition would amount to manufacture. There is no plea before us that this is so nor in our view this can be held as manufacture in terms of Section 2(f) of the Central Excises and Salt Act, 1944. We, therefore, hold that the Collector (Appeals) was right in holding that inasmuch as the appellants manufactured only aluminium medium, the duty was liable to be paid only on that product. The appeal is, therefore, rejected.”

6. As the Tribunal in all the above decisions have held that putting two containers namely Aluminium Paste and Aluminium Medium in a single container, does not amount to manufacture, we follow the ratio of the same and allow the appeal of M/s. Berger Paints (I) Ltd. and reject the appeals i.e. E-1528-1529/85, filed by the Revenue.

7. However, it may be mentioned here that the Tribunal in the case of Advance Paints v. Collector of Central Excise, Mumbai reported in 2000(01)LCX0158 Eq 2000 (125) ELT 0812 (Tribunal) = 2000 (036) RLT 0882 (CEGAT) has held that the Dual Pack consisting of Aluminium Paste and Varnish to be mixed together before use, is classifiable under Heading : 32.08 of Central Excise Tariff Act, 1985 and not under Heading : 32.12. The said decision is not applicable to the facts of the instant cases inasmuch as the classification of Aluminium Paint has been decided under the new Tariff, whereas the issue involved in the present appeals, is classification of the product under the erstwhile Tariff. Para 3 of the said decision relies upon Note 2 to Section-VI which is the effect that goods to be put in sets consisting of two or more separate constituents some or all of which fall in this Section and are intended to be mixed together to obtain a product of Section-VI or VII, are to be classified in the Heading appropriate to that product. As such, it is because of the above Chapter Note, the goods were held to be leviable to duty again as Aluminium Paint and classifiable under Heading : 32.08 of CETA, 1985. The appeals are thus disposed of in the above terms.

Equivalent 2001 (135) ELT 0500 (Tri. - Kolkata)