Custom, Excise & Service Tax Tribunal
C.C.E., Panchkula vs Pragati Hightech Product (P) Ltd on 19 September, 2016
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL SCO 147-148, SECTOR 17-C, CHANDIGARH 160 017 COURT NO. I APPEAL NO. E/3738/2006 [Arising out of Order-in-Appeal No. 221/NS/PCK/2006 dated 28.07.2006 passed by the Commissioner of Central Excise (Appeals), Delhi-III] Date of hearing/decision: 19.09.2016 For approval and signature: Honble Mr. Ashok Jindal, Member (Judicial) Honble Mr. Devender Singh, Member (Technical) =======================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : seen
of the Order?
4. Whether Order is to be circulated to the Departmental: Yes
authorities?
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C.C.E., Panchkula.
:
Appellant
VS
Pragati Hightech Product (P) Ltd..
:
Respondent
Appearance:
Sh. Harvinder Singh, A.R. for the Appellant
None for the Respondent
CORAM:
Honble Mr. Ashok Jindal, Member (Judicial)
Honble Mr. Devender Singh, Member (Technical)
FINAL ORDER NO. 61522/2016
Per : Devender Singh
Revenue is in appeal against the order dated 28.07.2006 passed by Commissioner of Central Excise (Appeals) Delhi-III. The issue to be decided is the classification of plywood laminated with plasticized paper during 01.07.2004 to 28.02.2005.
2. Brief facts of the case are that the respondents are engaged in the manufacture of plywood/plyboard and plywood laminated with plasticized paper falling under chapter 44 of the erstwhile first schedule to the Central Excise Tariff Act, 1985. They wanted to include plywood laminated plasticized paper in their Central Excise Registration certificate as articles of wood, not elsewhere specified-others (Plasticized paper coated laminated plywood) under heading No. 4410.90 of the First Schedule to the Central Excise Tariff Act 1985. They started paying Central Excise Duty on the plywood manufactured and consumed captively by them in the manufacture of the plasticized paper and cleared the same at nil rate of duty under in the notification 10/03-CE dated 01.03.2003, classifying the same under sub heading No. 4410.90. The Central Excise officers after considering the manufacturing process felt that the product manufactured by the respondent would fall under sub Heading No. 4408.90 of the erstwhile first schedule to the Central Excise Tariff Act, 1985, which is analogous to the sub heading No. 4412.99.10 of the new schedule to the Central Excise Tariff Act, 1985 effective from 01.03.2005. Accordingly, show cause notice was issued and same was adjudicated. The Adjudicating Authority determined the classification under 441299.10 in the newly adopted Central Excise Tariff w.e.f. 01.03.2005 and under CETH 4408.90 in the Central Excise Tariff prior to 01.03.2005. The demand of Rs. 16,50,254/- was confirmed along with the interest and penalty of Rs. 5 Lakh was imposed on the respondent. In appeal, the order of the Adjudicating Authority was set aside by the Commissioner (Appeal), who held that the impugned goods were classifiable under 4410.90 as articles of wood, not elsewhere specified. Hence, the Revenue is in appeal against the said order before us.
3. Ld. A.R. for the Revenue submits that the issue is no longer res integra. In support of his contention, he invited attention to the judgment of this Tribunal in the case of Galaxy Plywood Inds. P. Ltd Vs. Commr. of C. Ex., Panchkula - 2016 (332)E.L.T. 132 (Tri.-Del.). In the said judgment, it is held as under:-
5. Before proceeding to analyze the issue of classification presented before us, it is worthwhile to mention that the period of dispute in this is from July, 2004 to February, 2005. The impugned product i.e. plasticized plywood is classifiable under Chapter Heading 4412 of the CETA, 1985 w.e.f. 1-3-2005. The Heading 4412 after 1-3-2005 is same as Heading 44.08 and reads as plywood, veneered panels and similar laminated wood. For better appreciation the relevant headings are extracted under:-
44.08 Plywood, veneered panels and similar laminated wood 4408.10 Marine plywood and aircraft plywood 16% 4408.20 Plywood for tea-chests when cut to size in 16% Panels or shook and packed in sets 4408.30 Decorative Plywood 16% 4408.40 Cutting and trimming of plywood of width 16% Not exceeding 5 centimeters 4408.90 Other 16% 44.09 .
44.10 Articles of wood not elsewhere specified Doors, of wood:
4410.11 Flush doors 16%
4410.19 Other 16%
4410.90 Other 16%
6. The flow chart explains the core manufacturing of the impugned product as putting of plasticized paper on top and bottom faces of glued core veneer. At the cost of repetition it is stated that Chapter Heading 44.08 speaks about plywood veneer panels and similar laminated wood. Whereas Heading 44.10 speaks about articles of wood not elsewhere specified and includes within it items like door, flush door other. We have gone through the judgment laid by three Member Bench of this Tribunal in Decorative (India) (P) Ltd. case and have also taken note of the fact that the appeal filed by the Revenue against the same before the Honble Supreme Court was dismissed. The Tribunal in the said case set aside the classification of paper faced laminated plywood as decorative plywood and accepted the alternative plea put forward by the assessee that paper faced laminated plywood would fall under sub-heading 4410.90 as articles of wood not elsewhere specified-others. The tribunal has merely accepted the plea, and while doing so has not addressed the issue whether paper faced laminated plywood would fall under the category article of wood as given under Chapter Heading 44.10. As stated earlier the Chapter heading 4408 speaks about plywood, veneered panels and similar laminated wood. Chapter Note 5 of Heading 44.08 is reproduced as under:
For the purposes of Heading No. 44.08, the expression similar laminated wood includes blockboard, laminboard and battenboard, in which the core is thick and composed of blocks, laths or battens of wood glued or otherwise joined together and surfaced with the outer plies and also panels in which the wooden core is replaced by other materials such as a layer of layers of particle board, fiberboard, wood waste glued or otherwise joined together, asbestos or cord.
7. The Honble Supreme court in the case of Kitply Industries Ltd. (supra) while considering the issue, whether laminated panels of particle and medium density fiber board should be classified under sub-headings 4406.90 and 4407.90 or under sub-heading 4408.90 held that Heading 4408 covers plywood, veneer panels and similar laminated wood. The word used is similar and not same and therefore any resemblance to plywood or veneer panels is enough. The Apex Court referred to the discussion to the word similar made in the case of CCE, Shilong Vs. M/s Wood Craft Products Ltd.-1995 (77)E.L.T. 23 (S.C.) and observed as follows:
18. From the above, it is clear that the product is similar to plywood and veneered panels and hence Tariff Heading 44.08 is squarely applicable. Further, in the instant case, the core layer is made up of the particle board of MDF board (referred to as mother boards in the process mentioned above) and joined together with the help of resins and then laminated with plasticized paper (paper impregnated with melamine formaldehyde resin). Hence it is also clearly seen that the laminated panels manufactured by the respondent are covered under Chapter Note 5 to Chapter 44 of the Schedule to the Act. The product need not be same as plywood or veneered panels but mere similarity with them is enough for chapter Note 5 to apply.
8. The Chapter Heading 44.08 specifically speaks about plywood, veneered panels and similar laminated wood. Whereas, the Chapter Heading 44.10 speaks about articles of wood not elsewhere specified. Undeniably, the impugned product does not fall into article of wood. So the product which is plasticized plywood is classifiable under Chapter Heading 44.08 only. Moreover, this Tribunal in the case of Permali Wallace Pvt. Ltd. reported in 2011 (274)E.L.T. 558 (Tri.Del.) examined the scope of Heading 44.08 along with Chapter Note 5 and held veneered sheets will be classified therein. In the light of the observations made by the Apex Court in the case of CCE, Noida Vs. Kitply Industries Ltd. and apply the same, we are of the considered view, that the impugned product is classifiable under Chapter Heading 44.08. The issue is answered in favour of the Revenue.
4. Following the judgment relied upon by the Revenue, which relates to identical product during the same period, we hold that the impugned goods, namely, plywood laminated with plasticized paper are correctly classifiable under Chapter Heading 44.08 of the erstwhile first schedule to CETA 1985.
5. In view of the foregoing, the impugned order is set aside and appeal filed by the Revenue is allowed.
(Operative part pronounced in the court) Ashok Jindal Member (Judicial) Devender Singh Member (Technical) NS 2 E/3738/2006- CHD