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Issues: Classification of imported goods under the Customs Tariff Act
Issue 1: Classification of goods under Chapter Heading 44.03 vs. Chapter Heading 1211.90 The appeal involved a dispute regarding the classification of imported "Desapped Sandal Wood (Roots)" by M/s. Sri Mahalakshmi Flour Mills. The appellants argued that the goods should be classified under Chapter Heading 44 of the Customs Tariff Act as they were using the roots for manufacturing 'Aggarbatti'. On the other hand, the Revenue contended that the roots should be classified under Chapter 12.11, which covers plants primarily used in perfumery. The Tribunal examined the nature of the goods and their intended use. The Tribunal found that since the Sandal Wood Roots were to be used in the manufacture of 'Aggarbatti' for fragrance purposes, they were primarily used for perfumery. Therefore, the classification under Chapter 12.11 was deemed appropriate, rejecting the appellant's argument based on a previous Supreme Court judgment regarding the interpretation of the term "perfumery". Analysis: The appellant, represented by Shri Laxminarayan, argued that the imported Sandal Wood Roots should be classified under Chapter Heading 44.03 of the Customs Tariff Act as they were intended for use in manufacturing 'Aggarbatti'. The appellant relied on a Supreme Court judgment in the case of Pardeep Aggarbatti v. State of Punjab to support their argument that the term "perfumery" should be interpreted in a specific context. They contended that since the roots were used for 'Aggarbatti' production, they should not fall under Chapter 12.11 as claimed by the Revenue. Analysis: On the other hand, Shri L. Narasimha Murthy, representing the Revenue, argued that the Sandal Wood Roots should be classified under Chapter 12.11 of the Customs Tariff Act, which covers plants primarily used in perfumery. The Revenue emphasized that the roots were generally used for perfumery purposes and, therefore, should be classified accordingly. They presented their case based on the specific provisions of the Customs Tariff Act related to the classification of plants and plant parts used in perfumery or similar purposes. Final Decision: After considering the arguments from both sides, the Tribunal analyzed the nature of the imported goods and their intended use in manufacturing 'Aggarbatti'. The Tribunal concluded that since the Sandal Wood Roots were to be utilized for fragrance purposes in the production of 'Aggarbatti', they were primarily used for perfumery. Therefore, the classification under Chapter 12.11 of the Customs Tariff Act was deemed appropriate, rejecting the appellant's reliance on the interpretation of the term "perfumery" from the previous Supreme Court judgment. Consequently, the appeal filed by the appellant was rejected, affirming the classification under Chapter 12.11 for the imported goods.
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