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SUPREME COURT OF INDIA
A.K. Sikri and Rohinton Fali Nariman, JJ.
Holostick India Ltd. – Appellant
Vs.
Commissioner of Central Excise – Respondent
Civil Appeal Nos. 2729-2730 of 2004
Decided On : 30-03-2015
Central Excise Tariff Act, 1985 - First Schedule to Customs Tariff Act, 1975 - Printing industry - Coated metalized - Whether lacquered or metalized or laminated supported or similarly combined with other materials or not - Commissioner Central Excise by an order dated agreed with Departments classification and classified said goods under Tariff entry - An appeal to Customs Excise & Service Tax Appellate Tribunal by Appellant was dismissed - Tribunal by impugned judgment agreed with learned Commissioner and added reasoning of its own to which Court shall advert to later - At this stage it is important to set out relevant tariff entries – Held, Court will now come to impugned judgment - CESTAT in impugned judgment states - General Explanatory Notes of HSN below clearly mentions that Goods of Heading are also excluded from this Chapter even if they are printed with motifs characters or pictorial representations which are merely incidental to primary use of goods - For this reason self-adhesive printed stickers designed to be used for example for publicity advertising or mere decoration e.g. comic stickers and window stickers mention in HSN Notes below Heading would not cover products of Heading - In view of this decisions relied upon by Advocate are not applicable to facts of present matters - In Holographic Security Marking Systems case product involved was stamping foils falling under Heading of Tariff which was classified under Heading after hologram was printed thereon - Tribunal observed that until product became transformed because of printing of material on it continued to be stamping foil - In present case even after printing because of Note to Section VII product continues to remain classified under Heading of Tariff - Court thus hold classification of impugned product under Heading of Tariff - Appeals allowed
JUDGMENT
Rohinton Fali Nariman, J.
1. The present case concerns itself with a classification issue. The facts necessary to appreciate the controversy are as follows:
The Appellant manufactures security holograms. At the very beginning of the manufacturing process, they use coated metallised film which we are informed is classified under Tariff entry 39.20.36 after which the said film is embossed. Post embossing, there is adhesive coating and release coating which results in a hologram which ultimately is cut to size and utilised by customers of the Appellant for security purposes. In the show cause notice dated 04.02.2000, the Department sought to classify the security hologram under Tariff entry 39.19 of the Central Excise Tariff 1999-2000. In the reply dated 15.05.2000, the Appellant disputed this and stated that, in fact, the holograms ought to be classified under Tariff entry 49.01.
2. The Commissioner, Central Excise, by an order dated 01.01.2002 agreed with the Department's classification and classified the said goods under Tariff entry 39.19. An appeal to the Customs, Excise & Service Tax Appellate Tribunal (hereinafter referred to as 'CESTAT') by the Appellant was dismissed. The Tribunal by the impugned judgment dated 19.12.2003, agreed with the learned Commissioner and added reasoning of its own to which we shall advert to later.
3. At this stage, it is important to set out the relevant tariff entries:
39.19
3919.00 Self-adhesive plates, sheets, film, foil, tape, strip and other flat shapes, of plastics, whether or not in rolls.
39.20 Other plates, sheets, film, foil and strip, of plastics, non-cellular, whether lacquered or metallised or laminated, supported or similarly combined with other materials or not.
| = | Of Polymers of vinyl chloride | |
| 3920.11 | -- | Rigid, plain |
| 3920.12 | -- | Flexible, plain |
| 3920.13 | -- | Rigid, lacquered |
| 3920.14 | -- | Flexible, lacquered |
| 3920.15 | -- | Rigid, notallised |
| 3920.16 | -- | Flexible, metallised |
| 3920.17 | -- | Rigid, laminated |
| 3920.18 | -- | Flexible, laminated |
| 3920.19 | -- | Other |
| - | Of regenerated cellul | |
| 3920.21 | -- | Film, plain |
| 3920.22 | -- | Film, lacquered |
| 3920.23 | -- | Film, notallised |
| 3920.24 | -- | Film, laminated |
| 3920.25 | -- | Sheet, plain |
| 3920.26 | -- | Sheet, lacquered |
| 3920.27 | -- | Sheet, metallised |
| 3920.28 | -- | Sheet, laminated |
| 3920.29 | -- | Other |
| - | Of other plastics : | |
| 3920.31 | -- | Rigid, plain |
| 3920.32 | -- | Flexible, plain |
| 3920.33 | -- | Rigid, lacquered |
| 3920.34 | -- | Flexible, lacquered |
| 3920.35 | -- | Rigid, notallised |
| 3920.36 | -- | Flexible, netallised |
| 3920.37 | -- | Rigid, laminated |
| 3920.38 | -- | Flexible, laminated |
| 3920.39 | -- | Other |
49.01 Printed books, newspapers, pictures and other products of the printing industry; manuscripts, typescripts and plans
4901.10 - Transfers (decalcomanias)
4901.20 - Maps and hydrographic or similar charts of all kinds including atlases, wall maps, topographical plans and globes, printed
4901.90 - Other
4. Shri V. Lakshmikumaran, learned Counsel appearing for the Appellant, has raised a number of arguments before us. According to him, a reference to the Rules for Interpretation of the First Schedule to Central Excise Tariff Act, 1985, when properly read, would necessarily yield the result that the said goods would fall only under Entry 49.01. In the course of the argument, he also referred to the Harmonised System of Nomenclature (called 'HSN') Explanatory Notes to which we shall advert a little later.
5. He also cited before us a decision of the Tribunal in 'Holographic Security Marking Systems Pvt. Ltd. v. C.C.E., Mumbai [2003 (151) E.L.T. 470], an appeal from which was dismissed by the Supreme Court. In addition, he cited a judgment of this Court reported in 'Collector of Central Excise, S
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