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2020 (1) TMI 707 - HC - GSTClassification of goods - odomos - Appellate Authority has upheld the ruling of the Authority for Advance Ruling classifying odomos (product in issue), under HSN 38089191 of Chapter 38 of the Customs Tariff Act, 1975 - whether classified under HSN 38089191 of Chapter 38 of the Customs Tariff Act, 1975 or under heading no. 3004 of the Customs Tariff Act, 1975? HELD THAT - A perusal of the classification heading no. 38089191 shows that the product in question is a neat fit into the description of products laid down therein. No laboured process of reasoning is required since the heading no.38089191, is clear as daylight - The conclusion of the Appellate Authority in this regard are consistent with the Rules of interpretation and judicial authority in point. The invocation of the general entry called others by the petitioner is clearly misconceived, since the product in question is covered by a specific description in the heading under which the product has been classified - This Court is not persuaded to take a different view. It is established that all attributes of mosquito repellents relevant for a judicial enquiry of this nature are found in the product in question. This is not a fit case to judicially review the impugned order. Consequently, we decline to exercise our discretionary jurisdiction under Article 226 of the Constitution of India in favour of the petitioner - there is no palpable infirmity in the classification of the product in the order passed by the Appellate Authority. Petition dismissed.
Issues Involved:
1. Classification of the product "Odomos" under the Customs Tariff Act, 1975. 2. Whether "Odomos" should be classified as a mosquito repellent or a medicament. Issue-wise Detailed Analysis: 1. Classification of the product "Odomos" under the Customs Tariff Act, 1975: The petitioner challenged the classification of "Odomos" under HSN 38089191 of Chapter 38 by the Appellate Authority for Advance Ruling. The petitioner argued that "Odomos" should be classified as a medicament under heading no. 3004. The Appellate Authority upheld the ruling of the Authority for Advance Ruling, classifying "Odomos" as a mosquito repellent. 2. Whether "Odomos" should be classified as a mosquito repellent or a medicament: The petitioner contended that "Odomos" is a medicament due to its chemical composition and characteristics. The Appellate Authority, however, found that "Odomos" is marketed and identified as a mosquito repellent. The product's primary function is to repel mosquitoes, and it is commonly understood and used as such in the market. The product is not typically prescribed by medical practitioners and is available in general stores, not restricted to chemists. Detailed Analysis: Findings of the Appellate Authority: The Appellate Authority noted that "Odomos" is prominently labeled and advertised as a mosquito repellent. The product's market identity is as a mosquito repellent, and its primary motive is to protect users from mosquito bites. The Authority found that "Odomos" is not prescribed as a medicine and is sold in various types of stores, indicating its common use as a mosquito repellent. Nature and Scope of Enquiry for Classification: The classification of products under fiscal statutes is guided by the understanding of the product in popular parlance and its market usage, rather than scientific and technical meanings. The common parlance test is used to determine how the product is perceived and used by consumers. Judicial Pronouncements and Interpretation: The Hon'ble Supreme Court has consistently held that the understanding of products in popular parlance and commercial language is crucial for classification under taxing statutes. The Court has emphasized that the primary object of fiscal statutes is to raise revenue, and the common understanding of products by consumers should guide their classification. Application of Common Parlance Test: The Appellate Authority applied the common parlance test, finding that "Odomos" is understood and used as a mosquito repellent. The product's active ingredient, NNDB, is an improved version of DEET, a known mosquito repellent. The Authority concluded that the mosquito repellent characteristic of DEET is retained in the final product. General Rules for Interpretation of Import Tariff: The Appellate Authority followed the General Rules for Interpretation of Import Tariff, which prefer specific descriptions over general ones. The product "Odomos" fits clearly under heading 38089191 for mosquito repellents, making the invocation of a general entry like "others" inappropriate. Judicial Review and Procedural Propriety: The Court's role in judicial review is to examine the decision-making process, not the decision itself. The Court found that the Appellate Authority adhered to principles of natural justice, provided full opportunity for hearing, and supported its decision with cogent reasons. There was no arbitrariness or perversity in the findings. Conclusion: The Court upheld the classification of "Odomos" as a mosquito repellent under heading 38089191, affirming the order of the Appellate Authority. The petitioner's argument for classification under heading 3004 as a medicament was rejected. The writ petition was dismissed, and the Appellate Authority's order was affirmed.
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