2008 (8) TMI 146 - AT - Central Excise

Classification - Thandai Bahar (consisted of Badam paste, spice paste, syrup) and Badam Bahar - classifiable under heading 2001.10 of tariff which covers preparation of nuts - as per the Note 6 to Chapter 21, Orange Crush, Khus and Rose bahar are classifiable under heading 2108.20 of Central Excise Tariff Act as sharbat - appellant filed declaration declaring the ingredients to the revenue claiming a specific classification, therefore, it is not a fit case for imposition of penalty

Summary

Issues involved: Classification of products under Central Excise Tariff Act - Thandai & Badam Bahar, Orange Crush, Khus and Rose Bahar.

Analysis:

1. Thandai & Badam Bahar Classification:
The appellant contended that Thandai and Badam Bahar should be classified under heading 2001.10 of the tariff as preparations of nuts. They argued that the main ingredient, badam, is a nut used in manufacturing these items. The appellant cited a previous Tribunal decision where similar products were classified under the same heading. The Tribunal noted the ingredients and manufacturing process of Thandai and Badam Summer Sip, emphasizing the use of almonds and other plant-based components. The ingredients of Thandai Bahar and Badam Bahar declared by the appellant were found to be similar to those in the previous case, leading to the classification under heading 2001.10 of the tariff.

2. Orange Crush, Khus, and Rose Bahar Classification:
Regarding Orange Crush, Khus, and Rose Bahar, the revenue argued that these products qualify as sharbat under Note 6 to Chapter 21 of the Tariff due to their composition. The definition of sharbat includes non-alcoholic sweetened beverages or syrups with specific fruit juice percentages or flavored with non-fruit flavors. The Tribunal found that Orange Crush contained more than 10% fruit juice, meeting the sharbat criteria. Similarly, Khus and Rose Bahar were flavored with non-fruit flavors, aligning with the sharbat definition. Thus, these products were classified under heading 2108.20 of the tariff.

3. Penalty Imposition and Conclusion:
The Tribunal upheld the classification of Orange Crush, Khus, and Rose Bahar under heading 2108.20 while allowing the classification of Thandai and Badam Bahar under heading 2001.10 as claimed by the appellant. The duty was ordered to be requantified based on the revised classifications. Since the appellant had declared the ingredients and claimed a specific classification to the revenue, the Tribunal deemed it inappropriate to impose a penalty. Therefore, the penalty imposition was set aside, and the appeal was disposed of accordingly.

In summary, the judgment addressed the classification issues of various products under the Central Excise Tariff Act, emphasizing the ingredients, manufacturing processes, and alignment with specific tariff headings. The decision provided clarity on the classification of Thandai & Badam Bahar, Orange Crush, Khus, and Rose Bahar, ensuring a fair assessment based on the defined criteria and previous precedents.