2013 (12) TMI 392 - AT - Central Excise

Classification Coconut oil in small packing of 200ml and less Chapter 33 OR Chapter 15 of Central Excise Tariff Act Held that - Edible Coconut Oil packed and sold in the packing of capacity of 200ml and less is classifiable under Chapter Heading 15 of the Central Excise Tariff and not under Chapter 33 of the Tariff - The edible Coconut oil who packed in the packing of more than 200ml the same is classifiable under Chapter 15 of Excise Tariff Relying upon AISWARYA INDUSTRIES Versus COMMISSIONER OF C. EX., PONDICHERRY 2008 (7) TMI 771 - CESTAT, CHENNAI - When the same edible oil is packed in the packing of 200ml or less cannot be considered as preparation for use on hair in the absence of any evidence that the composition of both types of oils are different Decided in favour of Assessee.

Summary

Issues:
Classification of Coconut Oil packed in 200 ml or less packaging under Chapter 15 or Chapter 33 of Central Excise Tariff.

Analysis:
The appeals involved a common issue regarding the classification of Coconut Oil packed in 200 ml or less packaging by the appellants. The appellants contended that the Coconut Oil, which is edible oil, should be classified under Chapter 15 of the Central Excise Tariff, even when packed in 200 ml or less packaging. The Revenue, on the other hand, sought to classify the same under Chapter 33 of the Tariff as preparation for hair. The adjudicating authority had confirmed the demands, imposed penalties, and held that the products were wrongly classified to evade duty, leading to confiscation, redemption fine, and penalties.

The appellants argued that the Coconut Oil, being edible grade oil, should be classified under Chapter 15, regardless of the packaging size. They presented samples and packaging labels indicating the edible nature of the oil. The Revenue relied on a Board Circular to support the classification under Chapter 33. The appellants referenced a Tribunal decision and a Supreme Court order, which favored classifying edible Coconut Oil in smaller packaging under Chapter 15.

The Tribunal analyzed the Excise Tariff chapters, noting that Chapter 15 covers fats and oils, while Chapter 33 pertains to cosmetics or toilet preparations. It observed that the edible Coconut Oil in packaging over 200 ml was accepted under Chapter 15. The Tribunal emphasized that without evidence of compositional differences, the same oil in smaller packaging cannot be considered for hair use. Referring to a previous Tribunal decision and Board Circular, the Tribunal concluded that edible grade Coconut Oil in smaller sachets falls under Chapter 15.

The Tribunal compared the packaging labels of the products in question with those in a previous case, highlighting the representation of edible grade Coconut Oil. The Tribunal noted the similarity in facts with the earlier case and the subsequent Supreme Court dismissal of the Revenue's appeal. Based on these findings, the Tribunal set aside the impugned orders, allowing the appeals.

In conclusion, the judgment resolved the issue of classification of Coconut Oil in 200 ml or less packaging under Chapter 15 of the Central Excise Tariff, emphasizing the edible nature of the oil and the absence of evidence supporting classification under Chapter 33. The decision aligned with previous rulings and upheld the classification of such Coconut Oil as edible grade oil under Chapter 15.