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Regarding eligibility of concessional duty under Notification No. 25/
99-Cus, dated 28-2-99 to BOPP and Hazy film as 'plain film'
Circular No. 66 dated 11th August
2000
I am directed to
refer to the subject mentioned above and to say that a representation has been
received in Board's office Electronic Components Industries Association (ELCINA)
regarding denial of the benefit of notification to BOPP film and Hazy film used
in the manufacture of the capacitors.
2. The
matter has been examined. Notification No. 25/ 99-Cus., dared 28-2-99, vide
entry at Sl.No.52 prescribes a concessional duty of 5% on plain plastic films
(other than polystyrene film) of thickness 12 microns or below when used in the
manufacture of electronic capacitor grade metallised dielectric plastic film.
The word 'plain' is defined as 'not further worked'. From a perusal of the
available literature, it would appear that both BOPP and Hazy films are 'further
worked' films. BOPP films are reported to be oriented films obtained by
stretching of hot plastic film to realign the molecular configuration in two
dimensions for improving the mechanical properties of the film, like
tensile strength, impact strength etc. Similarly, Hazy films are surface treated
films made by hazy. It is also reported that the cost of plain films is in the
range of Rs. 110/ - per kg. whereas BOPP films are much costlier. Further even
though the composition of the plain film, BOPP film and Hazy film are one and
the same, they are different in physical properties and market identification by
way of nomenclature and value.
3. There
are several Judicial pronouncement which state a notification has to be
interpreted as such and one should not go beyond the express requirements of the
language used therein. Viewed in this light, BOPP and Hazy PP films do not
qualify for the exemption, as these products are quite different from plain
films in terms of appearance, quality and price even though they may be used in
the manufacture of plastic film capacitors. Instances have also been brought to
the notice of the Board where importers have filed B/ E for clearing BOPP/ Hazy
films without seeking the benefit of the exemption notification.
4. Keeping
in view the position explained above, it has been decided that BOPP and Hazy PP
films will not be eligible for concessional duty under Notification No. 25/
99-Cus., dated 28.2.99 (SI.No.52) as 'plain film' . Custom Houses may finalise
the provisional assessments in the light of above decision. Wherever final
assessments have been done, demands may be issued for the past period. Board may
please be apprised of the action taken in the matter.
Please acknowledge the receipt of this circular.
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