2017 (5) TMI 1286 - AT - Central Excise

Classification of goods - Henna powder in unit containers - classifiable under CTH 3305 or under 1401 1019? - Held that - reliance placed in the case of Henna Export Corporation Vs. Collector of Central Excise 1993 (2) TMI 185 - CEGAT, NEW DELHI where it has been held that Henna Powder in bulk will be appropriately classifiable under 14.01 CETA, 1985 and it was further held that for hair dye manufactured by Henna Export Corporation where there is an indication for its use as a hair dye, was classifiable under heading 33.05 and it clearly indicated that if Henna Powder is indicated to be used as hair dye then it would be classifiable under heading 33.05 CETA, 1988 - appeal dismissed - decided against Revenue.

Summary

Issues: Classification of Henna Powder under Central Excise Tariff Act, 1985

Analysis:
1. Facts of the Case: The respondents, manufacturers of Henna Powder under the brand name 'Goldiee Marwari Mehndi,' claimed classification under Tariff item No. 1404 1019. Revenue contended that the goods, sold in unit containers for human body use, should be classified under Chapter Heading No. 33.05. Three show cause notices were issued demanding Central Excise Duty.

2. Decision of Original Authority: The original authority confirmed the demand, classifying the goods under chapter 33, leading to appeals before the Commissioner (Appeals).

3. Order-in-Appeal: The Commissioner (Appeals) held that the goods were classifiable under Tariff item No. 1404 1019, distinguishing the case law cited by Revenue and providing that there was no indication on the packing for hair use. This decision was challenged in appeals.

4. Appellate Tribunal's Analysis: The Tribunal considered the case law of Henna Export Corporation and noted that Henna Powder in bulk is classifiable under 14.01, while if indicated for hair use, it falls under 33.05. In this case, as the goods were intended for hand use, not hair, the Tribunal dismissed all three appeals by Revenue, granting consequential relief to the respondents.

5. Conclusion: The Tribunal's decision was based on the specific indication of use on the unit packing, aligning with the classification criteria under the Central Excise Tariff Act, 1985. The judgment emphasized the importance of clear indications for classification purposes, ultimately ruling in favor of the respondents and against the Revenue's contentions.