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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4513 OF 2005

M/S. HCL LIMITED .....APPELLANT(S)

VERSUS

COMMISSIONER OF CUSTOMS NEW DELHI .....RESPONDENT(S)

J U D G M E N T

A.K. SIKRI, J.

Classification of the machines known as Risograph, which

are  imported  by  the  appellant  M/s.  HCL Limited,  is  the  issue

involved in the present appeal.   The question is as to whether

Risograph is an office machine having duplicating function and

thus to be classified under sub-heading 8472.90 of the Customs

Tariff  Act,  1975  or  is  it  a  printing  machine  to  fall  under

sub-heading 8443.50.  The main chapter under which both the

sub-headings fall is Chapter 84 which deals with 'Machinery and

mechanical  appliances'.   Sub-heading  84.43  thereof  relates  to

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'Printing machinery; machines for uses ancillary to printing' and

various entries under this sub-heading are as follows:

84.43 Printing  machinery;  machines  for  uses ancillary to printing - Offset printing machinery:

8443.11 - Reel fed 65%

8443.12 - Sheet  fed,  office  type  (sheet  size  notexceeding 22 x 36 cm) 65%

8443.19 - Other 65% - Letterpress printing machinery,  

8443.21 - Reel fed 65% 8443.29 - Other 65% 8443.30 - Flexographic printing machinery 65% 8443.40 - Gravure printing machinery 65% 8443.50 - Other printing machinery 65% 8443.60 - Machines for uses ancillary to printing 65% 8443.90 - Parts 65%

2) Sub-heading 84.72, on the other hand, deals with  'Other office

machines' and  includes  duplicating  machines.   Various  entries

under this sub-heading read as under:

84.72 Other  office  machines  (for  example, hectograph  or  stencil  duplicating machines,  addressing  machines, automatic  banknote  dispensers, coin-sorting machines, coin-counting or wrapping  machines,  pencil-sharpening machines,  perforating  or  stapling machines)

8472.10 - Duplicating machines 65% 8472.20 - Addressing  machines  and  address  plate 65%

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embossing machines

8472.30

- Machines for  sorting or  folding mail  or  for inserting  mail  in  envelopes  or  bands, machines  for  opening,  closing  or  sealing mail and machines for affixing or cancelling postage stamps

65%

8472.90 - Other 65%

3) As per the appellant-assessee, Risograph machine is a printing

machine  which  should  be  covered  by  sub-heading  8443.50,

namely,  'other  printing  machinery'.   On  the  other  hand,  the

respondent-Revenue has taken the position that it is a specie of

duplicating machine and falls under the sub-heading 8472.90, viz.

'Other'.  Though under both the sub-headings the import duty is

65%,  however,  insofar  as  printing  machinery  is  concerned,  by

virtue of Notification No. 59/94-CUS dated March 01, 1994, which

includes Chapter Heading 84.43, the duty is to be calculated at

the rate of 25%  ad valorem.  That is the precise reason behind

the present lis between the parties

4) From the aforesaid, one thing is clear.  Risograph machine does

not  fit  in  any  of  the  specific  descriptions  contained  either  in

sub-heading 84.43 or 84.72.  Both the parties are trying to fit it in

the respective residual clauses viz.  “Other printing machine” or

“Other” respectively.  Therefore, what needs to be examined is as

to whether the Risograph machine would belong to the family of

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'printing  machinery'  or  it  belongs  to  the  clan  of  'duplicating

machine'.   Right  from  the  Order-in-Original  passed  by  the

Adjudicating Authority, Commissioner of Customs (Appeals) to the

Customs Excise and Service Tax Appellate Tribunal (CESTAT),

the view taken is in favour of the Revenue thereby holding the

Risograph machine to be in the nature of a duplicating machine,

which  does  not  qualify  to  be  a  printing  machine  at  all.   The

Tribunal,  while  holding  that  it  is  to  be  classified  as  an  office

machine having duplicating function,  has relied upon its  earlier

judgment in the case of  Pioneer International  v.  Collector of

Customs, Kandla1.  The attempt on the part of the appellant to

demonstrate that it does printing job and is improperly referred to

as a duplicating machine has not cut any ice with the Tribunal

which  has  chosen  to  follow  its  own  decision  in  the  case  of

Pioneer International.  In a case like this, the first query of the

Court was as to whether in the case of Pioneer International any

appeal was preferred.  Answer given was in the negative, which

means that the correctness of the order of the Tribunal in Pioneer

International was not tested in this Court.

5) Questioning  the  wisdom  of  the  authorities  below  with  the

contention that they have arrived at incorrect conclusion in this

1 2000 (122) ELT 430 (Tri.)

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behalf, it was argued by the learned counsel for the appellant that

a  detailed  reply  dated  February  01,  1995  was  filed  to  the

show-cause  notice  dated  January  13,  1995  issued  by  the

Assistant  Collector  of  Customs contending that  the machine is

classifiable under sub-heading 8443.50.  It was pointed out that in

support  of  the  aforesaid  plea  taken  by  the  appellant  it  had

enclosed opinions from various customers who were using the

Risograph  machine  as  a  printing  machine  and  also  the

assessment by the Japanese Customs specifically classifying the

machine under sub-heading 8443.50.  The appellant categorically

brought to the notice of the Assistant Commissioner the following

facts for the purpose of classification:

(a) Riso  Kagaku  Corp,  the  manufacturers  of  Risograph,  were

themselves clearing the machine under sub-heading 8443.50 of

the classification without raising any objection;

(b) test  of  trade  parlance  was  in  favour  of  the  appellant  wherein

Risograph  is  commercially  known  and  understood  as  a  digital

printing machine in India as well as abroad, as evident from the

declaration of the manufacturers;

(c) the mere fact that Risograph starts with an original cannot be a

ground to  say  that  it  is  not  a  printing machine when all  other

printing machines require an original in some form or the other, be

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it in the form of plates or digital images;

(d) HSN Explanatory Notes clearly support the classification of the

machine  under  Chapter  Heading  84.43  wherein  it  specifically

provides  that  in  addition  to  normal  type  of  printing  machine

Chapter  Heading  84.43  also  cover  special  machines  such  as

small office printing machines which operate by means of printing

type or by offset process, and which are improperly referred to as

'duplicating  machines' because  their  operating  principles  and

appearances  are  similar  to  those  of  duplicating  machines,  no

doubt referring to machines like Risograph;

(e) even if  principles  of  duplication are  involved,  Chapter  Heading

84.72 would not be attracted because the HSN Explanatory Notes

clearly provide that the said heading specifically excludes small

printing machines even if intended for office use; and

(f) Risograph  machine  functions  in  the  principles  of  printing

machines as it  uses ink drums and squeegee rollers therein to

print images similar to the process of screen printing.

Besides this, the appellant explained in detail the technical

specifications of a Risograph machine and its functioning and also

explained that the principle of Risograph is akin to screen printing

for  which the appellant  submitted technical  literature.   Learned

counsel for the appellant submitted that the aforesaid aspects are

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totally ignored by the authorities below and insofar as the Tribunal

is  concerned,  it  has  conveniently  omitted  to  look  into  these

aspects by blindly following its decision in Pioneer International

and has erred in the following manner thereby:

(a) The opinion rendered by the DGTD/Deputy  Chief  Controller  of

Imports and Exports is in favour that the Risograph is a printing

machine and such technical opinion has not been overcome by

the impugned order.  There is no rebuttal to the opinions obtained

from DGTD etc. by the Revenue.  A number of other buyers have

certified that the machine is a printing machine and not rebutted

by the Revenue.

(b) The Japanese Customs have classified the Risograph only under

Chapter Heading 84.43 and this position is not disputed even by

the Indian Customs.

(c) The scanner has been extensively used in the printing industry to

transfer the image by utilising a thermal head to make masters

used for printing, and hence the classification of the Risograph

can only be under that Chapter Heading.

(d) Risograph does not cut stencils but makes masters of the image

to be printed.

(e) Chapter  Heading  84.72  is  a  residuary  entry  and  the  HSN

specifically  rules  out  classification  of  the  Risograph under  that

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heading.

(f) The bare literature of the Risograph Machine clearly shows that

the machine is nothing but a printing machine.

(g) The Tribunal in para of the order in  Pioneer International  has

held that the Risograph is used to reproduce copies and does not

have any mechanism to print any original matter.  This is totally

incorrect  inasmuch as once the master is  made then from the

master, by the principle principle using ink, which flows through

the pores of the paper/plastic master, fresh prints are taken out.

There is no copying principle as in a photocopying machine.

(h) Operation Guide itself shows how the master is first made and

thereafter prints are taken out and hence the Conclusion of the

Tribunal in para 9 in Pioneer International is totally incorrect and

perverse.

(i) In the case of offset printing, as per the Tribunal, the impression is

taken on a rubber roller and then on to the paper.  In other words,

the  master  is  made  which  is  transferred  to  the  rubber  rollers,

which thereafter prints on the blank paper.  In the present case,

the Risograph makes the master and from the master prints are

obtained  and hence it  is  nothing  but  a  printing  process.   The

process of making master is akin to the printing plates made in

the printing industry and there is no escape from this conclusion.

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Moreover, the inked prints obtained as per the technical literature

of the Risograph is the same as what is recorded in para 10 of the

order in Pioneer International, that is 'offset printing is a process

in which the inked impression is made on to the paper'.  In the

case of the Risograph machine, ink goes through the pores of the

long fibred paper used in the paper plastic master to make the

prints.

(j) The master made by the Risograph is not like the stencil which is

a simple process in stencil duplicating machine, but the master is

by the printing technology principles for making the master. Such

stencil  making process for  printing is  indeed recognised in  the

HSN Explanatory Notes inasmuch as Heading 84.43 even covers

screen printing machines using a stencil screen band.  Thus, the

Risograph, after making the master, prints as in the case of an

ordinary printing machine.  It is incorrect to equate the Risograph

master to an ordinary tencil cut out on a typewriter for use in a

stencil duplicating machine.

6) Mr. K. Radhakrishnan, learned senior counsel appearing for the

Revenue, on the other hand, took us through the reasons given

by  the  Assistant  Commissioner  as  well  as  the  Commissioner

(Appeals)  in  support  of  their  findings and also relied upon the

Tribunal's decision in Pioneer International for the reasons given

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therein  and submitted  that  the  impugned order  of  the Tribunal

does  not  call  for  any  interference.   He  further  submitted  that

Risograph  machine  is  not  a  machine  to  print  original  matter.

Master  board  is  only  for  reproduction.   Giving  details  of  the

Risograph machine, he submitted that the Risograph works by the

process  of  automatic  digital  scanning,  thermal  screening

duplicating  systems.   The  principal  operations  involved  in  the

Risograph printer are screening, master making and printing.  The

printer's  scanner  consists  of  photo  sensors  comprising  of  light

emitting devices and of photo detector.  The light emitted from the

light emitting devices strikes the original.  The light is reflected by

lighter/white area of the original, whereas the light falling on the

darker  area  of  the  original  is  absorbed.   The  photo  detector

detects the reflected light and reads white and black areas of the

original,  as  read  by  the  scanner.   The  thermal  head,  which

consists of hundreds of heat emitting elements, is used to make

the  master  copy  on  the  basis  of  the  signal  received  from the

image scanner.  This master copy is exactly similar to a stencil

used in a duplicating machine,  which is  then loaded on to the

drum.  The ink which is carried in the drum pieces through the

micro-pores in the master on the paper when it is fed underneath

the rotating drum.  It  is,  therefore,  submitted that  Risograph is

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nothing  but  a  transformation  of  the  duplicator  with  certain

additional  functions.   The  afore-mentioned  process  clearly

indicates  that  there  are  no  principles  of  offset  printing  or

photocopying involved.  It  is further submitted that the principal

function is that of a duplicating machine and cannot be treated as

a offset printing machine.

7) He also submitted that on February 02, 1993, the Conference of

Collector of Customs examined under which chapter tariff heading

Risograph should be classified.  The Collectors' Conference, after

examining the detailed catalogue and working of Risograph, came

to the conclusion that the machine is a duplicating machine and,

therefore,  appropriately  classifiable under  Heading 84.72.   The

Collectors' Conference also came to conclusion that Risograph is

more appropriately classifiable under sub-heading 8472.10.

8) He, thus, summed up his arguments by contending that printing

and photocopying were somewhat overlapping in the instant case.

However,  insofar  as  Risograph  machine  is  concerned,  unlike

normal printing machines, original goes into the said machine and

master  copy is  made inside the machine and then copies are

prepared/taken.  Simply because it is able to make 130 copies in

one minute would not make it a printing machine, but it was only a

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high quality photocopy machine with following features:

A. The following three systems function in tandem to produce 130

copies or so per minute:

(a) Master making system : High-speed Digital Scanning and Thermal Screening system

(b) Printing system : Automatic  Stencil  Duplicating System

(c) Image scanning system : Flat-bed scanner moving system

Thus, the specification itself establishes that the printing system

inside the Risograph is an Automatic Stencil Duplicating System.

B. The input is the original and the output is the copy of the original.

C. Technology in Risograph is simple, highly reliable, speed-wise far

more  superior  and  cost-wise  less  expensive  than  a  standard

photocopier.

D. Per contra, in printing there is no original.  The original has to be

printed.

E. The concepts of Common Parlance and Principal Function ensure

that the Risograph merits classification in sub-heading 8472.90.

According to Mr. Radhakrishnan, Common Parlance theory shall

also apply  in  this  case inasmuch as in  the market  and to  the

general consumers of this product, it was known as photocopying/

duplicating machine only and not as printing machine, which was

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its principal function.

9) We  have  given  our  due  consideration  to  the  aforesaid

submissions of the learned counsel for the parties and have also

gone through the material as well as literature produced by the

learned counsel in support of their respective submissions.  In a

matter like this it is obvious that we have to understand what is

duplicating machine and what is printing machine and how they

differ from each other.  Thereafter, we will have to take note of the

technical  specifications  and  functioning  of  the  machine  in

question,  namely, Risograph Machine,  to  enable  us  to  find  an

answer  as  to  whether  it  fits  the  description  of  a  duplicating

machine or a printing machine.  For better understanding of the

matter  and  to  answer  the  question  appropriately, we may  first

scan through certain statutory and other relevant provisions.

10) As already noted above, Chapter Heading 84.72, applies to 'Other

office machines, includes duplicating machines'. HSN Explanatory

Notes to  Chapter  Heading 84.72 explains  that  the term  'office

machine'  is  to be taken in a wide general  sense to include all

machines used in offices, shops, factories, workshops, schools,

railway  stations,  hotels,  etc.,  for  doing  'office  work' (i.e.  work

concerning  the  writing,  recording,  sorting,  filing,  etc.,  of

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correspondence, documents, forms, records, accounts, etc.).  It,

thereafter, gives the description of duplicating machines, which is

included in the aforesaid Heading, as under:

“Duplicating  machines  of  the  hectograph  type (e.g.  gelatin  or  spirit  duplicators),  and  stencil duplicating  machines  which  operate  with  waxed paper stencils  previously  cut  by a stylus or  on a typewriter.   The  heading  includes  small  presses designed for use with hectographic apparatus.

But  it  excludes  small  printing  machines (e.g.  letterpress,  lithographic  or  offset  printing machines)  even  if  intended  for  office  us,  and duplicators using embossed plastic or metal sheets (including such machines which can also operate with stencils)  (heading 84.43),  and photocopying or  thermocopying  apparatus  and  microfilm apparatus (Chapter 90).”

11) The  HSN  Explanatory  Notes  makes  it  amply  clear  that  small

printing  machines,  even  if  intended  for  office  use  and  even

duplicators using embossed plastic or metal sheet, which can also

operate  with  stencils,  and  photocopying  etc.  are  specifically

excluded.  What follows from the above is that if there is a small

printing  machine  like  letterpress,  lithographic  or  offset  printing

machine, which does the printing work and also, at the same time,

performs  duplicating  work  with  stencils  or  otherwise  and  even

photocopying work, it would still be treated as a printing machine

and not duplicating machine.

12) This would lead us to the description of  'printing machinery'  as

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given in HSN Explanatory Notes to Chapter Heading 84.43.  It is

stated  therein  that  this  heading  covers  all  machines  used  for

printing by means of the type, printing books, plates or cylinders

of the previous heading and excludes the following:

“(a)   Office  hectograph  or  stencil  duplicating machines,  addressing  machines  and  other  office machines of headings 84.69 to 84.72.

(b) Photocopying  or  thermocopying  apparatus (e.g. for the production of blue prints, plans, etc., or for  the  reproduction  of  documents,  picture postcards, etc.) (Chapter 90).”

HSN Explanatory Notes further clarifies that this Heading includes

the following:

“(1) Machines  for  printing  a  repetitive  design, repetitive  wordings  or  overall  colour  on  textiles, wallpaper,  wrapping  paper,  rubber,  plastics sheeting, linoleum, leather, etc.

(2) Ancillary  machinery  (whether  or  not presented separately) such as feeders and folding machines, provided they are specially designed as ancillary machines to printing machines.”

13) Thereafter, description of 'printing machinery' is given by dividing

it  into  three  main  categories,  namely,  (i)  printing  presses,  (ii)

cylinder printing machines, and (iii)  Rotary presses.  Insofar as

printing presses are concerned, the variety thereof is stated in the

following manner:

“(i) Ordinary presses, used particularly for printing artists' engravings or proofs.  In their simplest form

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they usually consist  of  a fixed horizontal  slab (or bed)  to  hold  the  forme,  cliché  or  plate  to  be reproduced, and a movable plate which is pressed against  the  bed  by  means  of  a  screw  or  lever mechanism;  the  paper  sheet  is  interposed  and backed  with  a  special  material  (blanket)  to distribute  the  pressure  evenly;  inking  is  done  by hand or mechanically.

(ii)  Platen presses; these are much more powerful but similar in principle.  The movable pressure plate (or  platen),  with  the  blanket  and  paper  sheet  is almost horizontal, and closes like a jaw against the type  matter  held  in  position  by  the  fixed  vertical bed.  Normally, such presses are equipped with a roller  inking  arrangement,  but  the  group  also includes  non-inking platen presses  for dry relief printing.”

14) The aforesaid explanation acknowledges that this simplest form of

printing presses consists of a fixed slab (or bed) to hold the forme,

cliché or plate to be reproduced.  The ingredient of a plate from

which there can be reproduction is, thus, recognised as a process

of printing.  It would also be pertinent to mention that these very

HSN Explanatory Notes clarify that apart from the normal types of

printing machines, there are special printing machines which are

also covered by this heading.  Examples of 7 such machines are

specifically given.  For the purpose of this case, printing machine

described  at  serial  No.7  would  be  pertinent.   Therefore,  we

reproduce the said description hereunder:

“(vii)  Certain small office printing machines which operate by means of printing type or by the offset process,  and which are impropery  referred to  as

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“duplicating  machines”  because  their  operating principles and papearance are similar to those of duplicating machines.

This  group  also  includes  colour  printing machines,  used to  colour,  after  they  have  been first printed in black and white, special art editions, playing  cards,  children's  illustrations,  etc.,  by means of stencils or stencil-plates, the colour being applied by brushes, rollers or by spraying.”

15) What  is  significant  is  the recognition of  the fact  that  there are

many  special  machines  (obviously  due  to  advancement  of

technology)  which  are  small  office  printing  machines  and  they

operate by means of printing type or by the offset process.  It is

also acknowledged that many times these machines are confused

with  duplicating  machines  and  improperly  referred  to  as  such,

primarily  because of  their  appearance as duplicating machines

and similar operating principles.  Nevertheless, as per this Note

these are not to be treated as duplicating machines, but printing

machines. Underneath the aforesaid special printing machines it

is  further mentioned that there may be machines for printing a

repetitive design, repetitive words, etc. which would still qualify to

be printing machines.  Example of four such machines are given

in  this  inclusive  description  and  screen  printing  machines  are

specifically  included  therein.   The  aforesaid  aspects  are

demonstrated in the following specific words:

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“Machines for printing a repetitive design, repetitive words  or  overall  colour  on  textiles,  wallpaper, wrapping paper, linoleum, leather, etc., include:

(1)   Block  printing  machines  in  which  blocks engraved with the design,  generally  in  relief,  are repeatedly pressed on the cloth, wallpaper, etc., as it  passes through the machine,  thus producing a continuous  design;  the  same  machines  are  also used for printing separate designs (e.g. on scarves or handkerchiefs).

(2)  Roller printing machines, usually consisting of a large central cylinder (pressure bowl) around the  periphery  of  which  is  placed  a  series  of engraved colour rollers, each with its colour trough, furnisher roller, doctor blades, etc.

(3)  Screen printing machines.   The material  to be  printed  passes  through  the  machine  together with a stencil-screen band, the colour being applied through the stencil.

(4)   Yarn  printing  machines.   These  produce colour  effects  on  the  yarn  (or  sometimes  on  the roving before it is spun into yarn).”

16) Thus, a fine distinction between the printing machine on the one

hand and duplicating machine on the other has to be borne in

mind with specific understanding that in many cases there may be

confusion  between  duplicating  machine  and  specific  form  of

printing machine, namely, screen printing machine.  We may point

out  at  this  juncture  that  the  endeavour  of  the  appellant  is  to

establish that Risograph machine is nothing but Screen Printing

Machine.

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17) After taking note of the basic features which distinguish printing

from  duplicating,  let  us  understand  the  process  adopted  in

Risograph machine.

18) Risograph machine consists  of  an automatic  digital  scanner, a

thermal  head and a  printing  station.   The  prints  of  tex/images

which  can  be  taken  from  these  Risographs  can  be  suitably

enlarged or reduced as per the user.  The scanner portion of the

Risograph consists of a photo sensor comprising of light emitting

diodes and photo detectors.  The light emitted from these diodes

strike the original. The light falling on the dark areas of the original

are absorbed.  The photo detector then detects the reflected light

and reads the white and black area of  the original  as read by

image scanner.  The image thus formed by the scanner is a digital

image and not an optical image or continuous image.  From the

scanner,  image  signals  are  transferred  to  thermal  head.   The

thermal  head  is  used  to  make  master  necessary  for  printing,

based  on  the  signals  received  from the  image  scanner.   The

thermal  head  carrying  the  signal  received  from  the  scanner

touches the plastic film portion of the master.  Since the film is

heat sensitive, the plastic film melts while the base paper remains

unaffected, thus, forming the image of the original documents on

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the base paper.  This constitutes the master used for subsequent

printing.  The master material consists of film based on polyester

plastic  material  boded  with  long  fibre  Japanese  type  paper

(through  which  ink  can  penetrate).   The  master  film  is  a  few

microns  in  thickness  and  is,  thus,  thin.   The  polyester  based

material  is  bonded  to  the  long  fibre  Japanese  type  paper  by

co-polymerization.  The plastic film used is heat sensitive.  The

paper is basically cellulose web through which ink can penetrate.

The master material is in the form of a roll of paper.  The paper is

drawn from the roll and thermal head prepares the master.  The

prepared head is cut from the master and wound on the drum.

The surface of the drum is a fine mesh of steel wire so as to allow

ink to pass through the drum as well as the master while printing.

A  squeegee  roller  is  fitted  against  the  drum.   Ink  gets  filled

between the squeegee roller and steel mesh of the drum.  During

printing the squeegee roller rotates thereby forcing the ink to pass

through first, the drum surface, then to the master and then on to

the paper to be printed.

19) From  the  aforesaid  description  of  the  process  adopted  in

Risograph machine, it becomes apparent that Risograph printing

process is more akin to screen printing.  As already pointed out

above,  the  screen  printing  process  requires  a  stencil  and  a

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screen, with the stencil carrying the design to be printed.  This

stencil is mounted against the screen.  The printing itself takes

place when the ink  is  squeegeed through the stencil  onto  the

screen and ultimately onto the paper.  It is the screen which holds

the image area, which can carry either a pictorial or typographic

material.   Similarly, in  the  case  of  a  Risograph,  the  long  fibre

Japanese  type  paper  is  the  master  through  which  the  ink  is

pressed  to  reproduce  the  image  or  text.   The  screen  printing

stencil  prepared is equivalent  to the plastic film coating on the

cellulose fibre of Risograph master.  Thus, the principles adopted

for  printing  in  the  Risograph  is  akin  to  that  found  in  screen

printing.

20) At this stage, let us embark on a brief journey of printing from

Gutenberg to date to see how it has evolved over a period of time

leading to screen printing which is one of the most sophisticated

form of printing.

21) Printing, today, has become one of the most important means of

mass communication though with the advent of computers and

e-form  of  communication,  in  recent  years  its  importance  is

somewhat dented.  Fact remains that even today it remains an

important  means  of  mass  communication  along  with  Radio,

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Television  and  Films.   In  or  around  the  year  1440,  Johannes

Gutenberg  invented  and  developed the  printing  press.   It  was

'printing with movable type'.  Gutenberg made separate pieces of

metal type for each character to be printed.  With movable type, a

printer could quickly make many identical copies of a book.  Using

this process,  the same pieces of type could be used over and

over again – to print many different books.  Over a period of time,

there has been improvement in the methodology of printing with

the advancement of technology.

22) However, there are certain steps which are common to all printing

processes.  These steps include: (i) typesetting, (ii) proofing, (iii)

preparing  illustrations  for  reproduction,  and  (iv)  page  makeup.

Typesetting is  the process of  putting into type the words to be

printed.   It  is  also  called  composition.   Typesetting  can  be

classified as  (1)  hot-metal  typesetting or  (2)  photocomposition.

Hot-metal  type printing is now done mostly by machine,  which

was earlier done by hand.  There are two main kind of machines

that set metal type – the line caster and the Monotype.

23) Photocomposition (which is also called  phototypesetting) on the

other hand includes all type setting methods that do not set metal

type.   Phototypesetting  machines  produce  images  of  type

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characters on photosensitive film or paper.  It is this method which

is now widely used and has replaced hot-metal composition for

most printing.  Most commercial printing today is done by one of

the three processes: (1) relief printing, (2) offset lithography, or (3)

gravure printing.  Each of these processes uses a different kind of

image carrier  (the printing surface that carries the images to be

printed).  In relief printing, the printing surface is raised above the

level of the non-printing surface.  In offset lithography, the printing

surface and the non-printing surface are on the same level.  In

gravure  printing,  the  printing  surface  is  below  the  non-printing

surface.

24) In addition to the aforesaid three kinds of processes, many other

printing processes have also been developed.  Notable among

those are: (a) screen process printing, (b) collotype printing and

(c) flexographic printing.  

(a) Screen process printing requires a stencil and a fine cloth or wire

screen.  The stencil carries the design to be printed.  It can be

made simply by cutting the design out of paper.  The stencil is

mounted against the screen.  Ink is squeezed through the stencil

onto the surface to be printed.  The design can also be traced

directly on the screen, and the non-printing parts painted out.  Or

the screen can be given a light-sensitive coating and the design

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put on it photographically.  Screen process can be used to print

on paper, glass, cloth, wood, or almost any other material.  It is

used to print on objects of almost all sizes and shapes, including

draperies,  banners,  bottles,  toys,  and  furniture.   Most  screen

process printing is done on automatic or hand-operated presses.

Screen process is also called silk-screen printing.

25) It  is  difficult  to  equate  Risograph  machine  with  duplicating

machine.  Duplicating, as opposed to photocopying, requires the

preparation  of  a  master  sheet  which  makes  duplicates  on  a

machine.   There  are  two  main  types  of  duplicating:  stencil

duplicating  and  spirit  or  hectographic  duplicating.   Stencil

duplicating is a technique which uses a master sheet on to which

lettering is impressed as lines of perforations through which ink

can be squeezed on to the copy paper.  Spirit duplicating (also

known as hectographic duplicating)  is  a process/method which

uses strong aniline dye.  Originally the ink was transferred to a

sheet of gelatin by placing the sheet of paper with the dye on it in

a shallow tray.  The moisture retaining qualities of gelatin kept the

ink moist, and the copy was made by pressing an ordinary sheet

of  paper  on  to  the  gelatin.   The  modern  process,  which  has

replaced the aforesaid original version, was developed in the year

1923.  In this process, the master is in two parts, the lower one

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like a sheet of carbon paper with the dye on the top side; the dye

is transferred to the back of  the top sheet when it  is  typed or

written upon.  This sheet is then clipped to a revolving drum, and

the sheets to be printed are moistened with a volatile fluid which

dissolves a thin layer of dye on the master, thus transferring it to

the clean paper.  In a duplicating machine, as provided for in the

Customs Tariff Act, the stencil itself is made using a typewriter or

stylus i.e. the stencil is created outside of the machine before the

same  is  fed  and  ink  directly  passed  through  it.   The  HSN

Explanatory Notes to Customs Tariff Heading 84.72 itself confirms

this understanding wherein it is stated that duplicating machines

include  the  stencil  duplicating  machines  which  operate  with

waxed paper stencils previously cut by a stylus or on a typewriter.

26) As  pointed  out  above,  the  Tribunal  has  simply  relied  upon its

earlier decision in Pioneer International.  We have gone through

the said judgment.  In that case also the assessee had specifically

argued  that  the  printing  was  the  principal  function  of  the

Risograph machine.  In support, the assessee had relied upon the

dictionary meaning assigned to the 'printing machines' as well as

'duplicating  machines' and  it  was  argued  that  it  was  not  a

duplicating machine or a photocopier.  It  was emphasized that

Risograph  is  a  more  sophisticated  machine  with  previously

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unheard print quality; that the machine uses a method of scanning

at 400 DPI resolution as used in Scanners in Printing Industry;

that  instead  of  optical  system  (Lens  &  Mirror)  as  used  in  a

photocopier, Risograph uses a charged couple device, as used in

the scanners in printing industry; that the method is digital only;

that  just  like  in  Offset  Printing  which  uses a  lithographic  plate

made of aluminium or Zinc coated with photo sensitive material,

the  Risograph  uses  similar  materials  which  are  heat  sensitive

called  master;  that  a  number  of  masters  are  required  in  the

Risograph  for  multicolour  printing;  that  inversion  of  image  is

carried out during scanning and master making process itself; that

all  the facilities  available  in  printing are  available  in  Risograph

such as registering errors, adjustment of margin on four sides of

paper, margin for binding and fine tuning of the print.  It was also

argued  that  the  process  of  scanning  and  master  making  are

ancillary to printing and are inbuilt  in the machines; that simply

because certain processes are separately done in offset printing

does not mean that where these processes are inbuilt the same is

precluded from the term 'printing machinery'.

However, the aforesaid arguments were not accepted and

plea  of  the  Department  was  acceded  to  with  the  solitary

observation that the Risograph machine is used only to reproduce

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copies from the originals and it does not have any mechanism to

print  in  original  matter.   This  observation,  according  to  us,  is

contrary to plethora of material produced, coupled with the HSN

Explanatory Notes, as noticed above, which clinch the issue in

favour of the assessee herein.  We are, therefore, of the opinion

that  Pioneer International  does not lay down the law correctly

and over-rule the said judgment.

27) The outcome of the aforesaid discussion would be to allow the

appeal holding that the Risograph machine is in the nature of a

screen printing machine and not duplicating machine.  It would,

therefore, be covered under sub-heading 84.43 and not 84.72.

28) We,  thus,  allow  the  appeal  and  set  aside  the  orders  of  the

Tribunal and authorities below.  In the given circumstances, there

shall not be any order as to costs.

.............................................J. (A.K. SIKRI)

.............................................J. (ROHINTON FALI NARIMAN)

NEW DELHI; JULY 21, 2015

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