2004 (3) TMI 84 - HC - Central Excise

Summary

Issues:
Classification of goods under Tariff Heading 2106, Interpretation of Note 3 under Chapter 21, Applicability of Entry 20.01 for betel nut classification, Dispute over Entry 2106.90 for Pan masala classification.

Classification under Tariff Heading 2106:
The Tribunal held that the goods produced by the assessees were to be assessed under Tariff Heading 2106. This decision was made in response to appeals filed against the orders of the Commissioner of Central Excise classifying the goods as Pan masala under Chapter Heading 2106.90. The Tribunal set aside the appellate order and reinstated the original classification by the Assistant Commissioner of Central Excise.

Interpretation of Note 3 under Chapter 21:
The Assistant Commissioner classified the goods as Pan masala based on Note 3, which includes betel nut with other ingredients. However, the appellate authority disagreed, citing a judgment by the Madras High Court that the scented supari was not commonly known as Pan masala. The Tribunal upheld the classification under Pan masala, emphasizing the specific ingredients mentioned in Note 3.

Applicability of Entry 20.01 for betel nut classification:
The assessees argued that betel nut should be classified under Entry 20.01 as a nut. However, the Tribunal determined that betel nut falls more appropriately under Entry 21.90, specifically noting that Entry 2106.90 is a more specific entry for betel nut classification.

Dispute over Entry 2106.90 for Pan masala classification:
The judgment analyzed the definition of Pan masala under Note 3, which specifies the ingredients required for a product to be classified as Pan masala. The court concluded that the goods produced by the assessees, containing betel nut and menthol, qualified as Pan masala under Entry 2106.90. The court disagreed with a previous judgment requiring tobacco in the preparation to classify as Pan masala, emphasizing the specific language of Note 3 and the classification criteria under Entry 2106.90.

In conclusion, the court dismissed the writ petition, upholding the Tribunal's classification under Entry 2106.90 for the goods produced by the assessees. The judgment highlighted the importance of specific ingredients and classification criteria in determining the appropriate tariff heading for goods.