1994 (2) TMI 266 - AT - Central Excise

Issues Involved:
1. Classification of Noodles under sub-heading 1902.10 or 1902.90.
2. Definition and interpretation of "Unit Container" under the Central Excise Tariff Act, 1985.
3. Applicability of previous judgments and legal precedents regarding the definition of containers.

Detailed Analysis:

1. Classification of Noodles under sub-heading 1902.10 or 1902.90:
The primary issue in this case is the classification of "New Maggi-2 Minute Noodles" with tastemaker inside. The Assistant Collector classified the noodles under sub-heading 1902.10 as a preparation put up in unit containers, which was contested by the assessee, who argued that the packing was not a unit container and should be classified under sub-heading 1902.90, attracting a nil rate of duty. The Collector (Appeals) sided with the assessee, stating that the noodles were not in unit containers and thus should be classified under sub-heading 1902.90.

2. Definition and interpretation of "Unit Container" under the Central Excise Tariff Act, 1985:
The term "Unit Container" is defined in Section IV of CETA as "a container whether large or small (for example, tin, can, box, jar, bottle, bag or carton, drum, barrel or canister) designed to hold a predetermined quantity or number." The debate centered on whether the packaging process used for the noodles, which involves wrapping the noodles and tastemaker in a printed plastic film that is sealed and cut into individual packs, constitutes a unit container. The Senior Departmental Representative argued that the process results in unit containers as the pouches hold a predetermined quantity of noodles, fitting the definition of a unit container.

3. Applicability of previous judgments and legal precedents regarding the definition of containers:
The respondents relied on several judgments, including Commissioner of Sales Tax v. Voltas Ltd., Ajay Electrical Industries Ltd. v. Collector of Central Excise, and Asia Tobacco Company Ltd. v. Union of India, to argue that a container must pre-exist as an independent unit before goods are packed into it. They contended that the printed films used for packing noodles do not qualify as containers since they come into existence only after the noodles are packed.

Analysis and Conclusion:
The Tribunal carefully considered the submissions from both sides. It was noted that the definition of "Unit Container" in CETA does not require the container to pre-exist before the goods are packed. The Tribunal referenced the Andhra Pradesh High Court's decision in Andhra Pradesh Dairy Development Corporation Pvt. Ltd. v. Union of India and the Tribunal's decision in Collector of Central Excise, Chandigarh v. Himachal Pradesh Horticulture Produce Marketing & Processing Corporation Ltd., which clarified that unit containers are those in which goods are intended for sale, whether large or small.

The Tribunal also examined the packaging process in detail, noting that the noodles are packed in sachets containing a predetermined quantity, which aligns with the definition of unit containers. The Tribunal concluded that the noodles are put up in unit containers and ordinarily intended for sale, thus classifiable under sub-heading 1902.10 CETA.

The Tribunal dismissed the respondents' reliance on previous judgments, stating that the tariff description under CETA is specific and differs from the descriptions considered in those cases. The Tribunal emphasized that the packaging technology and methods should be considered, and in this case, the packaging process results in unit containers.

Final Judgment:
The Tribunal set aside the impugned order of the Collector (Appeals) and ruled that the noodles manufactured and cleared by the respondents are classifiable under sub-heading 1902.10 CETA. The appeal was disposed of accordingly.

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