2001 (12) TMI 250 - AT - Central Excise

Summary

Issues Involved:
1. Classification of 'Himtaj Tel' under Central Excise Tariff Act, 1985.
2. Applicability of exemption notifications to 'Himtaj Tel'.
3. Interpretation of Ayurvedic medicaments under Chapter 30 and perfumed hair oil under Chapter 33.
4. Consideration of conflicting decisions by different benches of the Tribunal.

Summary:

1. Classification of 'Himtaj Tel':
The primary issue is whether 'Himtaj Tel' manufactured by the appellant should be classified u/s 3003.30 of the Central Excise Tariff Act, 1985 as Ayurvedic medicine or u/s 3305.10 as perfumed hair oil. The Commissioner of Central Excise classified 'Himtaj Tel' as perfumed hair oil, imposing duty and penalty based on a prior decision by the Delhi Bench. However, the East Zonal Bench had classified identical goods as Ayurvedic medicine, leading to this reference to the Larger Bench.

2. Applicability of Exemption Notifications:
The appellant argued that 'Himtaj Tel' should be classified as an Ayurvedic medicament and be eligible for exemption under Notification No. 75/94-C.E., dated 29-3-94, which differentiates between classical Ayurvedic medicines and proprietary Ayurvedic medicines. The appellant contended that their product, containing ingredients mentioned in authoritative Ayurvedic texts, should fall under the 'others' category of sub-heading 3003.30, attracting a 10% duty.

3. Interpretation of Ayurvedic Medicaments and Perfumed Hair Oil:
The Tribunal examined whether 'Himtaj Tel' meets the criteria of Ayurvedic medicaments u/s 3003.30, considering the ingredients and therapeutic claims. The Tribunal noted that the product's ingredients are mentioned in authoritative Ayurvedic texts and the product is licensed under the Drugs and Cosmetics Act, 1940. The Tribunal also considered the Chief Chemist's report, which supported the classification of 'Himtaj Tel' as an Ayurvedic medicament.

4. Conflicting Decisions by Different Benches:
The Tribunal reviewed the conflicting decisions by the Delhi Bench and the East Zonal Bench. The Delhi Bench had classified 'Himtaj Tel' as perfumed hair oil, while the East Zonal Bench classified it as Ayurvedic medicine. The Tribunal agreed with the East Zonal Bench's decision, emphasizing that 'Himtaj Tel' is known as an Ayurvedic medicament in common parlance and contains only Ayurvedic ingredients.

Conclusion:
The Tribunal concluded that 'Himtaj Tel' should be classified as an Ayurvedic medicine u/s 3003.30 of the Central Excise Tariff Act, 1985, and not as a perfumed hair oil u/s 3305.10. The appeals were sent back to the appropriate Bench for further orders.