2004 (10) TMI 354 - AT - Central Excise

Summary

Issues: Classification of tobacco product under CET Heading 2404.90 vs. 2401.00

In this judgment by the Appellate Tribunal CESTAT, Mumbai, the issue revolved around the classification of a tobacco product, SAI Bhaiaki Mishri, manufactured by the respondents. The respondents initially classified the product under CET Heading 2404.90 as branded manufactured tobacco. However, the Assistant Commissioner approved the classification under CET sub-heading 2401.00 as branded unmanufactured tobacco. The Commissioner (Appeals) sided with the respondents, considering the product as a manufactured one under CET 2404.90, leading to an appeal by the Revenue.

The Tribunal, comprising Ms. Jyoti Balasundaram and Shri Moheb Ali M., analyzed the case, focusing on Chapter Note 2 to Chapter 24 of the Schedule to CETA, 1985. This note stipulates that certain activities like labelling, repacking, or adopting treatments to make a product marketable amount to manufacture for specific headings, including 2401, 2402, 2403, and 2404. The Tribunal noted that since the product bore the label "SAI Bhaiaki Mishri," it satisfied the criteria for deemed manufacture of a new product. Consequently, the Tribunal agreed with the lower appellate authority's decision that the disputed product should be classified as branded manufactured tobacco under CET 2404.90.

After hearing arguments from both sides, the Tribunal, in the absence of merit in the Revenue's appeal, upheld the Commissioner (Appeals)'s decision and dismissed the appeal. The judgment underscores the importance of considering labeling and marketability aspects in determining the classification of tobacco products under the relevant Central Excise Tariff headings.