2016 (3) TMI 1315 - AT - Central Excise

Classification of two products - Bio-95 and Herbal Pet Wash - Revenue classified Bio-95 under CETH 3402.90 and Pet Wash under CETH 3307.90 as against the appellant s claim under 3402.10 and 3401.11 respectively. Bio-95 - Held that - There is no dispute that the product is Organic Surface Active Agent as per the main tariff entry under chapter Heading 3402 - The product Bio-95 is clearly classifiable under the CETH 3402.10. CETH 3402.10 is a specific entry in respect of product namely Sulphonated Castor Oil and 3402.90 is for other. It is a settled law that specific entry prevails over the general entry - On the identical issue, in the case of Unitex Dychem India 1998 (5) TMI 99 - CEGAT, NEW DELHI this Tribunal decided the classification under 3402.10 of product containing 53% water and 47% Sulphonated Castor Oil. The present case of the appellant is on a better footing for the reason that in the captioned product Sulphonated Castor Oil used is to the extent of 95%, therefore, the judgment is squarely applicable. Herbal Pet Wash - Held that - As per the Drug licence in respect of this product, the product is manufactured out of Neem, soap-nut and shikekai, the product is licensed as Ayurvedic Proprietary Medicine, the label of the product highlights that it protects the pet animals from insects & pests. The product is also not used as toilet soap, so with this fact the product is a medicated soap which finds an entry under CETH 3401.11. The products namely Bio-95 and Herbal Pet Wash are correctly classified under 3402.10 and 3401.11 respectively - appeal allowed - decided in favor of appellant.

Summary

Issues:
Classification of products Bio-95 and Herbal Pet Wash under Central Excise Tariff Headings.

Analysis:
The judgment involves a dispute regarding the correct classification of two products, Bio-95 and Herbal Pet Wash, under the Central Excise Tariff Headings. The appellant initially classified Bio-95 under CETH 3402.90 but changed it to 3402.10 from 01-12-2004. The appellant argued that the product predominantly consists of Sulphonated Castor Oil, making it classifiable under 3402.10. The Tribunal agreed, citing the specific entry for Sulphonated Castor Oil under 3402.10, which prevails over the general entry of 3402.90. The judgment of Unitex Dychem India was relied upon to support this classification.

Regarding Herbal Pet Wash, the appellant claimed it should be classified under CETH 3401.11 as a medicated soap based on Ayurvedic formula, licensed by the Food & Drug Administration. The product was found to protect pet animals from insects and pests, not being a perfumery cosmetic or toilet preparation. The Tribunal agreed with this classification, citing a similar case involving the classification of a product for pets under 3401.11.

The judgment emphasized that the root cause of the dispute was the classification issue, and additional grounds raised on classification merit were allowed. Ultimately, the Tribunal ruled in favor of the appellant, setting aside the impugned order and allowing the appeal. The classification of Bio-95 under 3402.10 and Herbal Pet Wash under 3401.11 was deemed correct, leading to the disposal of the miscellaneous application as well.