Holding

Paper‑based decorative laminated sheets and cotton‑fabric‑based laminates are to be classified under Chapter 39 (sub‑headings 3920.31/3920.37) and are not eligible for the concessional excise rates granted under Notifications 135/89‑CE and 20/94‑CE.

Summary

The Supreme Court examined the classification of paper‑based decorative laminated sheets, cotton‑fabric‑based laminates and paper‑based electrical insulators manufactured by M/s Wood Polymers Ltd. The Revenue argued that the products fell under Chapter 48 (sub‑headings 4818.90/4823.90) and were eligible for concessional excise rates, while the assessee contended that the "common parlance" test placed them in Chapter 48. Applying Rule 3(b) of the Rules of Interpretation, the Court held that the essential character of the laminates is imparted by the impregnating resin, making them hard, rigid articles of plastic and therefore classifiable under Chapter 39 (sub‑headings 3920.31/3920.37). Consequently, the products are not covered by Notification 135/89‑CE or Notification 20/94‑CE and cannot claim the concessional duty. The Court set aside the Tribunal’s classification of the laminates under Chapter 48, upheld the classification of the insulators under heading 8546.00, and partially allowed the Revenue’s appeals.

Issues considered

The proper tariff classification of paper‑based decorative laminated sheets and cotton‑fabric‑based laminates under the Central Excise Tariff Act, 1985
Whether Rule 3(b) or the "common parlance" test governs the classification of composite goods
The applicability of Notification 135/89‑CE and Notification 20/94‑CE concessional rates to the laminates
The effect of the insertion of sub‑heading 4823.40 in Chapter 48 on the classification

Legislation cited

Central Excise and Salt Act, 1944s. Section 5-A
Central Excise Tariff Act, 1985
Finance Act, 1997

Subjects

excise dutytariff classificationdecorative laminatesRule 3(b)Central Excise Tariff Actconcessional ratepaper‑based laminatesChapter 39Chapter 48

Judgment

I
;

A COLLECTOR OF CENTRAL EXCISE
v.
MIS. WOOD POLYMERS LTD. ETC.
'\I
DECEMBER 17, 1997

B (S.C. AGRAWAL AND D.P. WADHWA, JJ.J

Excise Law:

Central Excise Tariff Act, 1985 :
c Sub-headings 3920.31/3920.37, 4818.90/4823.40 (as inserted in 1997)
and Rules for the Interpretation of the Schedule, Rules 3(b) and I-Ap-
plicability of-Paper-based decorative laminated sheets-Held, classifiable
under Sub-heading 3920.31 until 28.2.1988 and w.e.f 1.3.1988 under sub-
heading 3920.37 and not under Sub-headings 4818.90 or. under
D 4823.90-Classiftcation has to be done in accordance with the Rules for the
Interpretation of the Schedule and not on the basis of common parlance
test-Rule 3(b) and not Rule 1 of the said 1Ules is applicable in the present
case-Insertion of new sub-heading 4823.40 in Chapter 48 from 1997 does
not enable decorative laminates to be classified under Chapter 48 for the
E earlier peliod.

Sub-headings 3920.31/3920.37 or 3920.90/3926.90-Cotton fab1ic-based
laminated decorative boards-Held, classifiable under Sub-heading
3922.90/3926. 90.

F Sub-heading 8546.00 or 3920.21-Paper-based insulators elec/:lical
grade-Classification of-CEGAT rightly classified it under Sub-heading
8546.00 and not wider Sub-heading 3920.21.

Notification No. 135/89-CE dated 12.5.1989-Concession-Paper-
based decorative laminated sheets-Whether eligible for concessional rate of
G duty under Notification 135/89-CE dated 12.5.1989 for goods falling under
Sub-heading 4823.90-Although only Notification No. 144/94-CE dated
22.12.1994 amending Notification No. 20194 dated 1.3. 1994 had excluded
decorative laminates from the benefit of the concessional rates, even dwing
the preceding pe1iod-Held, not eligible for concessional rate of duty as prior
H to 1997 they did not fall under Sub-heading 4823.90-Central Excise Tariff
528
C. C. E. i•. WOOD POLYMERS LTD. 529

Act, 1985, Sub-heading 4823. 90---Uoods-Paper based decorative laminated A
sheets--Central Excise and Salt Act 1944, Section 5-A.

The respondent was a. manufacturer of paper based decorative
laminated sheets, cotton fabric-based laminates and paper-based in-
sulators electrical grades. These products were classified by the Assistant
Collector under Sub-heading 392031 and the same was approved by the B
Collector (Appeals). On further appeal, the CEGAT held that paper based
decorative laminated sheets/boards are classifiable under sub-heading
4818.90 till 28.2.1988 and under Heading 4823.90 on and after 13.1988, and
that cotton fabric based laminates are classifiable under Heading 3922.90
till 28.2.1988 and under Heading 3926.90 on and after 1.3.1988. As regards
paper-based insulators it was held the same was classifiable under Head-
c
ing 8546.00. Hence this appeal by the Revenue.

The Revenue contended that the classification of these products
-~
concluded in view of the decision of this Court in Bakelite Hy/am* case. ,.
The respondent-assessee contended that proper test applicable for clas- D
sification was the "common parlance test" and that so tested paper based
decorative laminated sheets primarily fell under Chapter 48 and not under
Chapter 39 of the Central Excise Tariff Act. It was further contended by
the respondent asses see that Rule 1 and Rule 3 of the Rule of Interpreta·
tion could be invoked for determining the classification of decorative
E
laminated sheets. It was also contended by the respondent-assessee that
in 1997 insertion of a new Sub-heading 4823.40 in Chapter 48 showed that
decorative laminates was an article of paper.

Allowing the appeals preferred by the assessee and dismissing the
Revenue's appeals, this Court. F
HELD : 1.1. In view of the rules regarding interpretation contained
in the Central Excise Tariff Act, the matter of classifications has to be
considered in the light of the said rules. Since decorative laminates are
composite goods made from different components, namely, paper and
chemical solutions with which it is impregnated, the dassification of G
decorative laminates has to be determined in the light of Rule 3(b). As a
result of impregnation with the chemical solutions the character of paper
is changed into decorative laminates and it is the chemical solutions which
gives them their essential character. Since the decorative laminated sheets
are hard and rigid in character, they are classifiable under Chapter 39 and H
•,
530 SUPREME COURT REPORTS [1997) SUPP. 6 S.C.R.

A not under Chapter 48. [536-A-C, 537-C]
1.2. In Bakelite Hy/am Ltd. *,it has been pointed out that Rule 1 does
not help to classify the goods in question because in view of Note l(f) in
Chapter 48 Central Excise Tariff Act is not applicable to these goods.
Under Note l(f) to Chapter 48 paper reinforced stratified plastic sheeting
B or one layer of paper or, paperboard coated or covered with a layer of
plastics the latter constituting more than half the total thickness or
articles of such materials, other than wall coverings of Headings 48.14 do
not fall in that Chapter but fall in Chapter 39. In view of the said provision
in Chapter 48 it' has been held that Rule 1 cannot be invoked and the
C matter of classification has to be determined in accordance with Rule 3 (b)
of the Rules of Interpretation. [537-F-H]

* CCE v. Bakelite Hy/am Ltd., (1997) 91 ELT 13 SC, relied on.
Moti Laminates (P) Ltd. v. CCE, (1995) 76 ELT 241, distinguished.
D
2.1. Decorative laminates have been mentioned in the entry falling in
Sub-heading 4823.40 which has been inserted in Chapter 48 presu'!lably in
view of the decisions of the Tribunal holding that paper-based decorative
laminated sheets fall under Chapter 48. The insertion of the said entry in
Chapter 48 does not mean that the interpretation placed by this Court in
E Bakelite Hy/am Ltd. on th1~ entries, as they stood prior to insertion of the
entry falling in Sub-heading 4823.40, is not correct. [538-1''-G]

CCE v. Bakelite Hy/am Ltd., (1997) 91 ELT 13 SC, relied on.

2.2. The paper-based decorative laminated sheets and cotton fabric-
F based laminated decorative laminated sheets are classifiable under Sub-
heading 3920.21 till 28.2.1988 and under Sub-,heading 3920.37 on and after
1.3.1988 and the decision of CEGAT holding that the same are classifiable
under Tariff Entries 4818.90/4823.90 and 3922.90/3926.90 cannot be upheld
,_
and has to .be set aside. [539-E, H]
G
Amit Polymers & Composites Ltd. v, CCE, (1989) 20 ECR 454
(CEGAT); Meghdoot Laminate Pvt. Ltd. v. CCE Ahmedabad, Order Nos.
552 to 572/89 dated September 29, (1989) (CEGAT); CCE v. Metrowood
Engi11ee1i11g W01ks, (1989) 22 ECR 369 (CEGAT), referred to.

H Wood Ploymers Ltd. v. CCE, (1990) 47 ELT 595 (CEGAT), reversed.
C. C. E. v. WOOD POLYMERS LTD. [S.C.AGRAWAL,J.] 531

3. In view or the decision in Bakelite Hylam Ltd. case, paper-based A
decorative laminated sheets do not ran under sub-heading 4923.90. There-
fore, the manufacturers or those goods are not entitled to claim the benefit
or concessional rate or duty on the basis or Notification No. 135 of 1989
dated 12.5.1989 and Notification No. 20/94dated1.3.1994. The fact that the
products known commercially as decorative laminates have been expressly B
mentioned in entry at Serial No. 6, as substituted on the basis of Notifica-
tion No. 144/94 dated 22.12.1994, does not mean that prior to the issuance
of the said Notification, laminates products known commercially as
•
decorative laminates fell within the ambit of Notification Nos. 135/89 dated
12.5.1989 and 20/94 dated 1.3.1994 for the purpose of concessional rate of
duty. The insertion of product known commercially as decorative C
laminates by N~tification No. 144/94 dated 22.12.1994 only means that
these products have been expressly excluded for the purpose of ap-
plicability or the concessional rate of duty. [542-E-G]
>
CCE v. Bakelite Hylam Ltd., (1997) 91ELT13, applied.
D
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 1852-53
(NM) of 1991 Etc.

From the Judgment and Order dated 6.3.90 of the Customs, Excise
and Gold (Control) Appellate Tribunal, New Delhi in E/3303 & '3439 of
1989-C. E
Joseph Vellapally, F.S. Nariman, Y.P. Mahajan, K.C. Kaushik, S.
Dwivedi, V.K. Verma, Mrs. Rekha Pandey, Ms. Meenakshi Arora, (Mrs.
Alka Agrawal, V.K. Bhatt, Mrs. V.D. Khanna) for M/s. J.M. Nanavati,
Associates, K.K. Rai, V.N. Nair, Ms. Amritha, Pravir Choudhary, Mrs. F
Janaki Ramachandran, K.K. Anand, Rajesh Kumar, M.L. Lahoty, Paban
Kr. Sharma, Himanshu Shekhar, R.N. Karanjawala, Mrs. Nandini Gore,
Arvind Kumar and Mrs. M. Karanjawala for the appearing parties.

The Judgment of the Court was delivered by
G
S.C. AGRAWAL, J.

CIVIL APPEALS NOS. 1852-53/1991, 2516-21/1992 AND
11899/1996

These appeals by the Revenue raise a common question, namely, H
532 SUPREME COURT REPORTS [1997] SUPP. 6 S.C.R.

A whether paper based laminate Sheets/Boards are classifiable for the
purpose of excise duty under Heading 3920.21 of the Schedule to the
Central Excise Tariff Act, 1985 (hereinafter referred to as 'the Act') as
claimed by the Revenue or under Heading 4818.90 of the said Schedule till
February 28, 1988 and under heading 4823.90 of the said Schedule on and
B after March 1, 1988 as found by the Customs, Excise & Gold (Control)
Appellate Tribunal (hereinafter referred to as 'the Tribunal').

M/s. Wood Ploymers Ltd., the respondent in Civil Appeals Nos.
1852·53 of 1991, manufactures (i) paper based decorative laminated sheets,
(ii) cotton fabric based laminates and (iii) paper based insulators electrical
C grade. The said products were classified by the Assistant Collector of
Central Excise under Chapter 39 sub-Heading 3920.21. The said
classification was approved in appeal by the Collector of Central Excise
(Appeals). On further appeal by the assessee, the Tribunal, by its
judgment dated March 6, 1990 held that paper based decorative laminated
D sheets boards are classifiable under sub-heading 4818.90 till February 28,
1988 and under Heading 4823.90 on and after March 1, 1988, and that
cotton fabric based laminates are classifiable under Heading 3922.90 till
February 28, 1988 and under Heading 3926.90 on and after March 1,.1988.
As regards paper based insulators it was held that same are classifiable
E under Heading 8546.00. In taking the said view the Tribunal has followed
its earlier judgments in Amit Polymers & Composites Ltd., Hyderabad v.
CCE Hyderabad, (1989) 20 ECR 454 and M/s. Meglzdoot Laminate Pvt. Ltd.
•
v. CCE Ahmedabad, Order Nos. 552 to 572/89 dated September 29, 1989.
As regards paper based insulators the Tribunal has placed reliance on its
decision in CCE Ahmedabad v. Metro Wood Engineeling Works, (1989) 22
F ECR 369, Civil Appeal Nos. 1852-53 of 1991 have been filed by the
Revenue against the said judgment of the Tribunal.

The same view was taken by the Tribunal in judgment dated August
17, 1991 in the case of Mis. Meghdoot Laminate Pvt. Ltd. and in the
G judgment dated November 3, 1995 in the case of M/s. Moti Polymers in
respect of paper based decorative laminated sheets which were held to be
classifiable under Heading 4818.90 and not under Heading 3920.21 as
claimed by the Revenue. Civil Appeal Nos. 2516-21 of 1991 and Civil
Appeal No. 11899 of 1995 have been tiled against the said judgment of the
H Tribunal.
C. C. E. v. WOOD POLYMERS LTD. [S.C. AGRAWAL, J.J 533

On behalf of the Revenue it has been submitted that the matter now A
stands covered by the recent judgment of this Court in CCE Hyderabad v.
Bakelite Hy/am Ltd., (1997) 91 ELT 13 SC. In that case the Court has
considered the questions regarding the classification for the purpose of
excise duty of the following items : (i) Decorative laminated sheets; (ii)
Industrial laminated sheets which are paper based, and (iii) Glass Epoxy
B
laminated sheets. In the judgment under appeal in that case the Tribunal
had held that all these varieties of laminated sheets were not covered by
Entry 15-A(2) and were classifiable under residuary Item 48 of the Old
Tariff which was in operation prior to coming into force of the Act and
that the said products were classifiable under Heading 4818.90 till February
28, 1988 and under Heading 4823.90 on or after March 1, 1988 and that c
they did not fall under Heading 3920.21 till February 28, 1988 and under
Heading 3920.37 on or after March 1, 1988 of the New Tariff in the
Schedule to the Act. Reversing the said view of the Tribunal, this Court
has held that the Tribunal had rightly classified decorative laminates under
residuary Item 68 of the Old Tariff. But as regards classification under the D
New Tariff, this Court set aside the decision of the Tribunal in so far as it
classified decorative laminated sheets under Heading 4818.90/4823.90 of
the New Tariff and held that decorative laminated sheets were classifiable
under Heading 3920.31/3920.37 of the New Tariff. In respect of industrial
laminated sheets and glass epoxy laminated sheets it was held that they had E
been correctly classified by the Tribunal under Heading 7014/8546 of the
New Tariff.

In view of the judgment of this Court in Bakelite Hy/am Ltd. (supra)
-- the decision of the Tribunal holding that paper based insulators
manufactured by M/s. Wood Polymer Ltd., (respondents in Civil Appeals
F
Nos. 1852-53 of 1991) are classifiable under Heading 8546 of the New
Tariff must be upheld since it is in consonance with the decision of this
Court in Bakelite Hy/am Ltd. (supra). The only question that remains is
with regard to classification of paper based decorative laminated
sheets/boards and cotton fabric based laminated sheets. G

Shri F.S. Nariman, the learned senior counsel appearing for the
respondents in Civil Appeal Nos. 1852-53 of 1991,has, however, urged that
the decision of this Court in Bakelite Hy/am Ltd. (supra)-does not lay down
the correct law and it needs reconsideration in so far as it relates to H
534 SUPREME COURT REPORTS (1997) SUPP. 6 S.C.R.

A classification of paper based decorative laminated sheets.

In order to deal with the said submission of Shri Nariman we would
~

set out the relevant entries in the New Tariff which were in these terms :

Heading No. Sub-heading No. Description of
B
3920 Other Plates, Sheets, Film, Foil
and Strip of pl as tics, non-
cellular, whether lacquered or
metallised or laminated,
supported or similarly
c combined with other materials
or not.
Of regenerated Cellulose :
3920.21 Film of thickness not exceeding
D 0.25 millimeters.
Of Other Plastics :
3920.31 Rigid plates, sheets, film foil
and strip.
4818 Other Articles of Paper Pulp,
E Paper, Paper-Board, Cellulose
Wadding or Wabs of Cellulose
Fibres.
4818.90 Other.

F Some changes were made in the tariff entries in the Schedule to the
Act with effect from March 1, 1988 and Heading No. 3920.31 was
re-numbered and as a result plates, etc. of other plastics that were 'Rigid
laminated' were placed in Heading 3920.37. Similarly, Heading 48.18 was
re-numbered as 48.23 and sub-heading 4818.90 was numbered as 4823.90
G with effect from March 1, 1988.

The New Tariff Introduced by the Act prescribes the Rules of
Interpretation of the entries and in respect of goods which are p1ima f acie
classifiable under two or more headings the following provision is
H contained in Rule 3 :
C.C.E. v. WOOD POLYMERS LTD. (S.C.AGRAWAL,J.] 535

"3. When by application of sub-rule (b) of Rule 2 or for any other A
reason, goods are, prima facie, classifiable under two or more
headings, classification shall be effected as follows :

(a) The heading which provides the most specific description shall
be preferred to headings providing a more general description ....... B

(b) Mixtures, composite goods consisting of different materials or
made up of different components, and goods put up in sets, which
cannot be classified by reference to (a), shall be classified as if
they consisted of the material or component which gives them their
essential character, insofar as this criterion is applicable. c
(c) When goods cannot be classified by reference to (a) or (b),
they shall be classified under the heading which occurs last in the
numrical order among those which equally merit consideration."
D
Shri Nariman has urged that test to be applied for classification for
the purpose of excise duty is the 'common parlance test', i.e. the sense in
which the product is understood in the trade parlance of commercial usage
and understanding. The learned counsel has submitted that paper based
decorative laminates are manufactured by passing several sheets of duty E
paid kraft paper through resin bath and are impregnated with a chemical
solution classified as resin solution (Phenol formaldehyde solution). It is
submitted that the paper based decorative laminates are, therefore,
primarily paper falling in Chapter 48 dealing with paper and paper board,

- articles of paper pulp and does not fall in Chapter 39 which deals with
plastic and articles thereto. It is submitted that this Court in Bakelite Hylam
Ltd. (supra) has considered the question in the light of Rule 3 of the Rules
F

of Interpretation and has not examined the trade parlance and commercial
.understanding test. It has also been urged that evidence in the form of
certificate of traders, dealers and users, expert opinions, trade, literature
and marketing material were produced before the authorities to show that G
the decorative laminates are in commercial parlance are not known as
plastic and are not sold, marketed and used as article of plastic.

We are unable to accept the said contention of the learned counsel.
In view of the rules regarding Interpretation which are contained in New H
536 SUPREME COURT REPORTS (1997) SUPP. 6 S.C.R.

A Tariff the matter of classification has to be considered in the light of the
said rules. As indicated earlier, Rule 3 of the said rules contains the
principles to be applied for classification of goods which are p1ima fade
classifiable under two or more headings. Since decorative laminates are
composite goods made from different components, namely, paper and
B chemical solutions with which it is impregnated, the classification of
decorative laminates has to be determined in the light of Rule 3(b).
According to the said rule, composite goods consisting of different
materials or made up of different components which cannot be classified
by reference to sub-rule (a) shall be classified as if they consisted of the
C material or components which gives them their essential character insofar
as this criterion is applicable. As a result to impregnation with the chemical
solutions the character of paper is changed into decorative laminates and
it is the chemical solutions which give them their essential character. In this
regard, this Court in Bakelite Hylam Ltd. (supra) has said : '-.--

D "In the present case, the essential character of a decorative
laminated sheet is its rigidity or strength and its resistence to heat
and moisture. These are essentially characteristics which are im-
parted by resins. Paper does not possess any of these charac-
teristics. Therefore, applying Rule 3(b) and going by the essential
E characteristics of such laminated sheets these goods are more
appropriately classifiable under Chapter 39."

Reliance has been placed by the Court on the following Explanatory
Note to Chapter 39 in the Harmonised System of Nomenclature :

F "Combinations of plastics and materials other than textiles : -
This Chapter also covers the following products, whether they have
been obtained by a single operative or by a number of successive
operations provided that they retain the essential character of
G articles of plastics :

(c) Paper reinforced stratified plastic sheeting, and products con-
sisting of one layer of paper or paperboard coated or covered with
a layer of plastics; the latter constituting more than half the
H thickness, other than wall coverings of heading 48.14.
C. C. E. v. WOOD POLYMERS LTD. [S.C. AGRAWAL,J.) 537

(d) Products consisting of glass fibres or sheets of paper, impreg- A
nated with plastics and compressed together, provided they have
a hard, rigid character. (If having more the character of paper or
of articles of glass fibres they are classified in Chapter 48 to 70, as
the case may be)".

B
It has been pointed out that Explanatory Note clearly provides that
sheet of paper impregnated with plastics and compressed together, as in
the present case, provided they have a hard, rigid character would fall
under Chapter 39 and if having more the character of paper or of article
of glass fibres they are classified in Chapters 48. Since the decorative
laminated sheets are hard and rigid in character, they are classifiable under c
Chapter 39 and not under Chapter 48.

Shri Nariman has placed reliance on the decision of this Court in
MotiLaminates Plivate Ltd. v. Collector, (1995) 76 ELT 241 SC, wherein it
has been held that Phenol Formaldehyde (Resol) is not "goods" capable of D
being bought and sold. Shri Nariman has also submitted that classification
of decorative laminated sheets can be determined under Rule 1 of the rules
of interpretation which reads as under :

"l. The titles of Sections a·nd Chapters are provided for ease of E
reference only for legal purposes, classification shall be determined
according to the terms of the heading and any relative or Chapter
Notes and, provided such headings or Notes do not otherwise
require, according to the provisions hereinafter contained."

In Bakelite Hylam Ltd. (supra) this C:ourt has taken note of Rule 1. F
It has been pointed out that Rule 1 does not help to classify the goods in
question because in view of Note l(f) in Chapter 48 is not applicable to
these goods. Under Note l(f) to Chapter 48 paper reinforced stratified
plastic sheeting or one layer of paper or paper board coated or covered
with a layers of plastics the latter constituting more than half the total G
thickness or articles of such materials, other than wall coverings of heading
No. 48.14 do not fall that Chapter but fall in Chapter 39. In view of the
said provision in Chapter 48 it has been held that Rule 1 cannot be invoked
and the matter of classification has to be determined in accordance with
Rule 3(b) of the Rules of Interpretation. H
,
538 SUPREME COURT REPORTS [1997] SUPP. 6 S.C.R.

A In Moti Laminates P1ivate Ltd. (supra) this Court was considering the
question whether resin or resol which are produced in the process of
manufacturing laminated sheets are liable to payment of excise duty for the
reason that artificial or synthetic resins and plastic materials are leviable
goods under Item 15A of the old tariff. It was held that resol or resin is
not marketable or capable of being marketed and, therefore, the same was
B not subject to duty. The said decision in Moti Laminates P1ivate Ltd.
(supra) docs not have any bearing on the question of classification of paper
based decorative laminated sheets produced by the respondents.

It has been pointed out that by Finance Act, 1997 the Central Excise
C Tariff Act, 1985 has been amended and the following new the sub-Heading
4823.40 has been inserted :

"4823.40. Products consisting of sheets of paper or paper board,
impregnated, coated or covered with plastics (including thermostat
resins or mixtures thereof or chemical formulations containing
D melamine, phenol or urea formaldehyde with or without curing
'·agents or catalysts), compressed together in one or more opera-
tions; products known commercially as decorative laminates".

The submission is that the insertion of the said new entry in Chapter
E 48 has to be regarded as legislative recognition of the commercial under-
standing that decorative laminates is an article of paper because products
known commercially as decorative laminates have been included in the said
entry falling in Chapter 48 which relates to paper and paper boards. We
are unable to accept this contention. Decorative laminates have been
mentioned in the entry falling in sub-Heading 4823.40 which has been
F inserted in Chapter 48 presumably in view of the decisions of the Tribunal
holding that paper based decorative laminated sheets fall under Chapter
48. The insertion of the said entry in Chapter 48 does not, in our opinion,
mean that the interpretation placed by this Court in Bakelite Hylam Ltd.
(supra) on the entries, as they stood prior lo insertion of the entry falling
G in sub-heading 4823.40, is not correct and it needs reconsideration. We are,
therefore, unable to atcept the contentions urged on behalf of the respon-
dents seeking reconsideration of the decision of this Court in Bakelite
Hy/am Ltd. (supra).

In accordance with the law laid down in Bakelite Hylam Ltd. (supra)
H it must be held that paper base~ decorative laminated sheets and cotton
C.C. E. v. WOOD POLYMERS LTD. [S.C.AGRAWAL,J.] 539

.. fabric based laminates are classifiable under Heading 3920.31/3920.37 of A
· the New Tariff and the decision of the Tribunal holding that the same are
I
classifiable under tariff entries 4818.90/4823.90 and 3922.90/3926.90 cannot
be upheld and has to be set aside.

In the result, Civil Appeals Nos. 1852-53 of 1991 are partly allowed
and, while maintaining the decision of the Tribunal that the paper based B
Insulators are classifiable under Heading 8546.00, the decision of the
Tribunal holding that paper based decorative laminated sheets are
classifiable under sub-heading 4818.90 till February 28, 1988 and under
sub-heading 4823.90 on and after March 1, 1988 and cotton fabric based
laminated decorative boards are classifiable under sub-heading 3922.90 till c
February 28, 1988 and under sub-heading 3926.90 on and after March 1,
1988 is set aside and it is directed that the paper based decorative
laminated sheets and cotton fabric based laminated decorative boards are
classifiable under sub-heading 3920.21 till February 28, 1988 and under
sub-heading 3920.37 on and after March 1, 1988. D

Civil Appeal Nos. 2516-21of1992 and 11899of1996 are also allowed
and the judgment of the Tribunal holding that paper based decorative
laminated sheets are classifiable under sub-heading 4818.90 is set aside and
it is held that the said product is classifiable under sub-heading 3920.31 till
E
February 28, 1988 and under sub-heading 3920.37 on and after March 1,
1988. No order as to costs.

CIVIL APPEALS NOS. 7027/1995, 7029/1995, 9483/1996, 221/1997,
10466/1995, 10489/1995
F
These appeals are filed against the judgment of the Tribunal dated
July 18, 1995 whereby the claim of the appellants for payment of excise
duty at the concessional rate on the basis of notification No. 135/89-CE
dated May 12, 1989 has been negatived.
G
The appellants manufacture paper based decorative laminated
sheets. The said products are made by coati!1g and impregnating paper in
chemical solution, namely, Phenol Formaldehyde Solution and Melamine
Formaldeyhdre solution. Notification No. 135/89 dated May 12, 1989
provided as follows : H
540 SUPREME COURT REPORTS (1997] SUPP. 6 S.C.R.

A "Notification No. 135/89-C.E. dated 12.5.1989

In exercise of the powers conferred by sub-section (1) of Section
SA of the Central Excises and Salt Act, 1944 (1 of 1944), the
Central Government, being satisfied that it is necessary in the
public interest so to do, hereby exempts goods falling under sub-
B
heading No. 4823.90 of the Schedule to the Central Excise Tariff
Act, 198S (S of 1986), other then products consisting of sheets of
paper or paper board impregnated, coated or covered with plas-
tics, compressed together in one or more operations, from so
much of the duty of excise leviable thereon which is specified in
c the said schedule as is in excess of the amount calculated at the
rate of 12% ad valorem ."

The said notification was subsequently replaced by Notification No.
20/94-C.E. dated March 1, 1994 which was in the following terms :
D
"Notificatioiz No. 20/94-C.E. dated 1.3. 1994
1;
Jn exercise of the powers conferred by sub- section (1) of
Section SA of the Central Excises and Salt Act, 1944 (1 of 1944),
the Central Government, being satisfied that it is necessary in the
E
public interest so to do, hereby exempts goods of the description,
specified in column (3) of the Table hereto annexed and falling
within the Chapter or sub-heading Nos. of the Schedule to the
Central Excise Tariff Act, 198S (S of 1986), as are specified in
column (2) of the said Table, from so much of the duty of excise
F leviable thereon which is specified in the said Schedule, as is in
excess of the amount calculated at the rate specified in the cor-
responding entry in column (4) of the said Table.

s. Chapter/ Description of goods Rate
No. sub-head No.
G
l. 48 Maplitho paper and kraft paper Nil
supplied to a braille press against
an indent placed by the National
Institute for Visually
Handicapped, Dehradun
H
C. C. E. v. WOOD POLYMERS LTD. [S.C. AGRAWAL, J.] 541

2. 48 Paper splints for matches, whether Nill A
or not waxed.
3. 48 Asphaltic roofing sheets Nill
4. 48 Paper pulp moulded trays Nill
5. 48 Cellulose insole board or sheets 10% B
ad valorem
6. 4811.30 All goods, other than products 20%
and 4823.90 consisting of sheets of paper or ad valorem
paper board impregnated, coated
or covered with plastics,
compressed together in one or
c
more operations.

By Notification No. 144/94-C.E. dated December 22, 1994 Notifica-
tion No. 20/94 dated March l, 1994 was amended and entry at serial No.
6 in the table annexed with the said notification was substituted by the D
following entry :

"All goods, other than the following, namely :

(a) Products consisting of sheets or paper or paper board im-
pregnated, coated or covered with plastics (including ther- E
moset resins or mixtures thereof or chemical formulations
containing melamine, phenol, urea or formaldehyde with or
without curing agents or catalysts), compressed together in
or more operations, or
F
(b) Products known commercially as "decorative laminates."

The case of the appellants is that till the issuance of Notification No.
144/94 dated December 22, 1994 they were liable to pay concessional rate
of excise duty on the basis of Notification No. 20/94 dated March 1, 1994
and only as a result of the amendment made in the said notification by G
Notification No. 144/94 dated December 22, 1994 paper or paper board
impregnated, coated or covered with plastics known as "decorative
laminates" have been excluded from the benefit of such concessional rate
of excise duty. The submission of the appellants is that the products
manufactured by them fall under sub-heading 4823.90 and do not fall under H
542 SUPREME COURT REPORTS [1997] SUPP.6 S.C.R.

A the exception since they are not laminated sheets or paper impregnated,
coated or covered by plastics but are made by coating and impregnating
with chemical known as Phenol Formaldehyde Solution and Melamine
Formaldeyhdre solution which is unstable and unmarketable and which is
not resin and that it cannot said that the paper is coated or covered with
B resins. In support of the aforesaid submission reliance is placed on the
decision of this Court in Moti Laminates Private Ltd. (supra). The Tribunal
has held that the decision in Moti Laminates Plivate Ltd. (supra) was
rendered in the context of marketability and it was not relevant to deter-
mine whether the final p1 oduct of the appellants is eligible to claim the
benefit of conces5ional rate of duty in terms of Notification No. 135/89.
c
In Bakelite Hy/am Ltd. (supra) this Court has held that paper based
decorative laminated sheets or boards do not fall in Chapter 48 but fall in
Chapter 39 of the New Tariff introduced by the Central Excise Tariff Act,
1985 and it cannot be classified under sub-heading 4818.90 till February 28,
D 1988 and under sub-heading 4923.90 on or after March 1, 1988. In view of
the said decision the products manufactured by the appellants, namely
paper based decorative laminated sheets do not fall under sub-heading
4923.90. The appellants are, therefore, not entitled to claim the benefit of
concessional rate of duty on the basis of Notification No. 135/89 dated May
12, 1989 and the Notification No. 20/94 dated March 1, 1994. The fact .hat
E products known commercially as decorative laminates have been expressly
mentioned in entry at serial No. 6, as substituted on the basis of J\:otifica-
tion No. 144/94 dated December 22, 1994, does not mean that prior to the
issuance of the Notification No. 144/94 dated December 22, 1994 products
known commercially as decorative laminates fell within the ambit of the
Notifications No. 135/89 dated May 12, 1989 and No. 20/94 dated March
F
1, 1994 for the purpose of concessional rate of duty. The insertion of
products known commercially as decorative laminates by Notification No.
144/94 dated December 22, 1994 only means that these products have been
expressly excluded for the purpose. of applicability of the concessional rate
of duty.
G
There is, therefore, no merit in these appeals and the same are
accordingly dismissed. But in the circumstances there is no order as to
costs.

R.K.S. Appeals dismissed.