ORDER
K.C. Mamgain, Member (T)
1. This appeal is filed by the Revenue against the Order-in-Appeal No. 250/2003-CE., dated 25-8-2003, passed by the Commissioner of Customs & Central Excise (Appeals), Cochin.
2. Shri P.M. Saleem, ld. SDR appearing for the Revenue pleaded that uncoated white cover paper manufactured by the Respondents is cover paper for binding educational text books which is classifiable under sub-heading 4805.00 and not under sub-heading 4802.10 which applies only to writing and printing paper for printing of educational text books. Thus the Respondents have not followed the provisions of Rule 4, 6 and 8 of the Central Excise Rules 2002 as they had cleared uncoated cover paper, at nil rate of duty misclassifying the item under sub-heading 4802.10. He accepted the Chemical Examiner’s Certificate that the cover paper is nothing but paper only and its GSM is 179.4.
3. Shri G. Sampath, ld. Advocate appearing for the Respondents pleaded that the order passed by the Commissioner (Appeals) is correct and he has taken into consideration all the details and has correctly classified it under sub-heading 4802.10. He pleaded that to classify the product under sub-heading 4802.10, three conditions are required to be satisfied, that is –
(a) GSM should be below 180.
(b) It should be uncoated paper and paper board of kind used for writing, printing or other graphic purposes.
(c) It should be for writing or printing of paper for educational text books. He stated that - (a) the GSM has already been certified by the Chemical Examiner as 179.4.
(b) the paper has been supplied to the Text Book Officer, Govt. of Kerala as per order No. 1990/B2/2002/STY dated 25-2-2002 as amended by letter No. 1990/B2/2002/STY dated 23-3-2002, of the Controller of Stationery, Government of Kerala.
(c) The paper has been supplied for printing educational text books.
He therefore pleaded that the item falls under sub-heading 4802.10. There is no reason mentioned in the show cause notice to justify that the printing paper manufactured by the Respondents should be classified under Heading 4805. He relied on the following decisions of the Tribunal –
(i) Vapi Paper Mills Ltd, v. Collector Central Excise – 1993 (67) E.L.T. 109.
(ii) Commissioner of Customs v. Ranka Enterprises – 2003 (159) E.L.T. 454.
(iii) Laxmi Board & Paper Mills v. CCE – 1993 (68) E.L.T. 857.
(iv) New India Industries Ltd. v. CCE – 1994 (73) E.L.T. 723.
He stated that classification has to be determined as per trade/commercial parlance/marketability/and end use. He further pleaded that grammage per square meter is an important criterion for distinguishing paper from the board and for this a substance of 180 gsm/sqmt provides a convenient dividing point. He further pleaded that the ultimate decision to classify a particular paper depends upon the trade usage and not on the substance alone. The CBEC have clarified this issue, as back as 1955, under Circular No. 36/121/54 Cus. dated 14-4-1955. He drew our attention to the finding portion of the order of the Commissioner wherein it is mentioned that the Controller of the Stationery, Govt. of Kerala had floated tenders to supply white paper board of size 180 gsm 51 cm x 90 cm. It is not dispute that the goods supplied are uncoated paper and use of such paper is to cover text books of the Government of Kerala. Sub-heading 4802.10 applies only to writing or printing paper manufactured from pulp and supplied directly from the factory of its manufacture against a purchase order and placed upon the manufacturer by a State Textbook Publication Corporation or Board. It is not in dispute that it is cover paper for printing of educational text books. Printing is also carried out on the papers of the cover. Therefore, there cannot be a reason to hold that the cover paper is not printing paper for printing of educational text books. He therefore pleaded that in view of the various decisions it is clear that what was supplied by the appellants was writing and printing paper for printing of educational text books. Therefore, department’s appeal may be rejected.
4. We have carefully considered the submissions made by both the sides. We find that the only reason which is given by the department in the appeal for classifying the product under Heading 4805 is that the paper manufactured by the appellants is a cover paper for printing educational text books. Therefore, it cannot be classified under sub-heading 4802.10. We find that the reasoning given by the Department is not correct. We find that it is not in dispute that the paper supplied by the Respondents is uncoated writing and printing paper having GSM of less than 180. Therefore it is a paper. It is used exclusively for printing of educational text books as certified by the Stationery Controller of the Government of Kerala. Therefore it is clearly covered by sub-heading 4802.10. It is not used for binding the text books. Therefore, following the decisions relied upon by the Respondents, we do not find any infirmity in the order of the Commissioner (Appeals). Accordingly the appeal filed by the Revenue is rejected.