S.D. Jha, Vice-President

1. The question for decision in this appeal by the Revenue is proper classification of respondents product "Diamond Coat Art Paper" and "Diamond Coat Chrome Paper" -Diamond being brand name - whether it falls under Tariff Item 17(1) of the First Schedule to Central Excises and Salt Act, 1944 as it stood after its amendment on 28-2-1982 hereinafter called Central Excise Tariff and if so not eligible to exemption from demand of duty under Notification 63/82-C.E., dated 28-2-1982 or Tariff Item 17(2) of the Tariff making it eligible to exemption under the notification.

2. The present dispute arises under the following circumstances. Earlier the respondents had been classifying two description of papers set out above under Tariff Item 17(1) as coated printing and writing paper until amendment of Tariff Item 17 on 27-2-1982. Simultaneously with this amendment Notification 63/82-C.E., dated 28-2-1982 exempting converted types of paper and paper board other than wall paper, art and chrome board falling under sub-item (2) of Item 17 of the Tariff from whole of the duty of excise leviable thereon subject to fulfilment of base paper having paid appropriate duty was issued. The respondents then filed classification list effective from 28-2-1982 claiming classification of their product under Tariff Item 17(2) and exemption under Notification 63/82, dated 28-2-1982. The Assistant Collector of Central Excise after serving notice dated 2-6-1982 on the respondents proposing to reject the claim for re-classification and after following usual procedure by Order-in-Original dated 2-7-1982 held that till then the respondents had been classifying their paper under Tariff Item 17(1) as a type of printing and writing paper and just because certain papers classifiable under Tariff Item 17(2) got the benefit of exemption notification, it will not be correct to change the basic classification of paper because of change in the rate of duty by way of notification. He further held that the two descriptions of paper are nothing but printing and writing paper classifiable under Tariff Item 17(i) and not eligible to benefit of the notification which is applicable to certain categories of paper falling under Item 17(2). In appeal by the respondent the Collector of Central Excise (Appeals), Bombay by order dated 31-12-1984 held in favour of the respondents (appellants before him) and disagreeing with the Assistant Collector he held that the two descriptions of paper were correctly classifiable under Tariff Item 17(2) of the Tariff and not under Tariff Item 17(1) and as converted paper they were eligible to exemption under Notification 63/82, dated 28-2-1982 provided the conditions stipulated in the said notification were fulfilled. He allowed the appeal. Aggrieved with this decision the Revenue has come up in appeal to the Tribunal.

3. At the hearing of the appeal Shri A.S. Sundar Rajan, 3DR drew our attention to samples of the base paper used by the respondents indicating the two descriptions of paper under dispute. It was explained that base paper in case of Diamond Coat Art Paper weights 60 to 140 gms. per sq. meter and on conversion by the respondents it weights 95 to 180 gms. About Diamond Coat Chrome Paper it was given out that base paper weights 55 to 150 gms. per sq. meter and coated paper 70 to 170 gms. per sq. meter. The difference of weight in the case of first item is in the range of 35 to 40 gms. and in the case of second item it is 15 to 20 gms. He submitted that prior to 1982 the respondents have been classifying their two descriptions of manufacture under Tariff Item 17(1) and the amendment in 1982 did not effect any change in the two sub-items and there was no provocation for the respondents for filing a revised classification list and claiming change in classification. He, however, admitted that in taxation matters like the present there was no estoppel or res-judicata and law did not prohibit the respondents from c