(a) Bonding of large-size sheets of paper and release paper with adhesive, or bonding of release paper and plastic film or aluminium foil or textile fabric as required.

(b) Printing of material required on labels on the bonded sheets in the appellants' printing press and simultaneously cutting the printed labels.

Prior to 1st March, 1987, Chapter 49 of the Central Excise Tariff Act, 1985 inter alia included products of the paper printing industry. By the Finance Act, 1987, with effect from 1.3.1987, the words 'products of the paper printing industry' were substituted by words 'products of the printing industry'. The appellants therefore filed the said classification lists in respect of the said printed labels manufactured from all the above base materials classifying the said labels under sub-heading 4901.90 as "Other products of the printing industry." By a show cause notice dated 13th october, 1987, issued by the Assistant Collector of Central Excise, Bombay Division III, the appellants were called upon to show cause as to why the said printed labels should not be reclassified under different sub-headings depending uponthe base materials used in the manufacture of the said printed labels viz the following:-

By their reply dated 15th December, 1987, the appellants contended that the said printed labels were correctly classifiable under sub-heading 4901.90.

2. By his order dated 27th June 1986, the Assistant Collector of Central Excise, Bombay rejected the appellants' contentions and confirmed the proposed classification in respect of the appellants' printed labels depending upon the base materials upon which the process of printing was carried out by the appellants. the main reason for rejecting the appellants contentions according to the Assistant Collector was that though the said articles contain printed materials, the same were merely incidental to their use. The Collector of Central Excise (Appeals) by his order in appeal, issued on 8th November 1989, held that the said printed labels were correctly classifiable under various Chapters depending upon the basis of raw material used in the manufacture of such labels, based on the contention, inter-alia, that labels were not products of the printing industry but were products of the packaging industry, in as much as, in principle, a label is no different from paper packaging in that it carries information about the contents and does not in anyway contribute anything to the quality of the product to which it has been affixed. He confirmed the classification of the disputed items as follows:-