Judgment:
1. This is an appeal filed by the Department with reference to the order of Collector (Appeals), Pune, dated 9-3-1992.
2. Learned Departmental Representative stated that the respondents were engaged in the manufacture of Printed Polyethylene Film. They had filed a classification list claiming classification under Heading 49.01 and the Assistant Collector had approved the classification and allowed assessment on the nil rate of duty as claimed. The Department filed an appeal against this order and the Collector (Appeals) had rejected the Department's appeal. Hence, this petition.
3. It was his contention that Section Note 2 was required to be taken into consideration and since Chapter 49 is not attracted as observed by the Collector himself, the classification was required to be made under Heading 3920.32. But, the Collector has rejected the Department's appeal.
4. Learned Counsel stated that Section Note 2 to Section VII is important for determining whether an item would continue to fall under Chapter 39 or would be classifiable under Chapter 49.
5. In this connection, he would like to draw attention towards the Collector v. Adhunik Plastik Industries Tribunal's Final Order No.27/98-C dated 14-1-1998, 1998 (98) E.L.T. 365 (Tribunal) in respect of their own product in which also, the dispute was whether the printed plastic film was classifiable under Heading 3920.21 or 4901.90 and the Tribunal has dismissed the Department's appeal holding that the item was classifiable under Chapter 49.
6. He would also like to draw attention to another order of the Tribunal in the case of Ellora Mechnical Products Pvt. Ltd. v. CCE, Meerut reported in 1998 (98) E.L.T. 109 (Tribunal) in respect of printing on duty-paid plastic films in which it was held that the process does not amount to manufacture because the plastic film does not change into a new product and the Bench had referred to the decisions of the Apex Court in support of its conclusion. He would also like to draw attention towards the judgment of Hon'ble Supreme Court in the case of Metagraphs Pvt. Ltd. v. Collector of Central Excise, Bombay reported in 1996 (88) E.L.T. 630 (S.C.).
7. We have considered the above submissions. We observe that both the sides are correct to the extent of pointing out that Section Note (2) is important for determining whether the item would fall under Chapter 39 or Chapter 49 and learned Collector has also referred to the same section note and explanatory notes to H.S.N. It is further observed that in paragraphs (7) & (8) of his order, the Collector has himself come to the conclusion that if a plastic film is manufactured and then subjected to printing, there is no further manufacture because a plain plastic film is converted into a printed plastic film both of which fall in the same heading/sub-heading of Chapter 39. In other words, the Collector had accepted the Department's contention regarding classification under Chapter 39 and the relevant heading. However, in the very last line of his order, he has rejected the Department's appeal and that is why perhaps this appeal has been filed. However, the correct course would have been to request the Collector to issue a corrigendum once the substantive plea of the Department had been accepted. We also further note that although the Collector has not accepted the respondents' plea of classification under Chapter 49, no appeal has been filed by them against the order of Collector (Appeals).
The fact that the Tribunal has passed orders in respect of such products, in other cases including that of the respondents' is another matter and undoubtedly, the orders already passed by the Courts and Tribunal will have to be taken note of till they hold the field but, insofar as this present case is concerned, the only observation which is required to be made is that the last line of the order being not in harmony with the actual finding portion given in para 7 & 8 was required to be suitably amended or modified as apparently the word ' "rejected" has got typed there as a result of either drafting or typographical error. With the above observations, the appeal is disposed of.