2002 (1) TMI 93 - AT - Central Excise

Summary

Issues:
Classification of 'Dant Manjan Lal' under Central Excise Tariff - Chapter Heading 33.06 or Chapter Heading 30.03.

Analysis:
1. The issue revolves around the classification of 'Dant Manjan Lal' under the Central Excise Tariff. The Division Bench referred the matter to the Larger Bench due to doubts on the correctness of the earlier decision classifying it under sub-heading 30.03.

2. The lower authorities initially classified 'Dant Manjan Lal' under Chapter Heading 33.06, citing a Supreme Court decision. The appellants argued that the Supreme Court decision was not applicable to their case and pointed out the specific tariff entry under Chapter 30 for pharmaceutical drugs.

3. The appellants contended that 'Dant Manjan Lal' should be classified under Chapter 30 as it falls under medicaments used in Ayurvedic systems. They relied on specific tariff entries and Supreme Court decisions to support their claim.

4. The appellants further argued that the product was manufactured according to formulae from the book 'Ayurved Sar Sangreh' listed in the Drugs and Cosmetics Act, making it eligible for classification under Chapter 30.

5. The appellants referred to circulars and court decisions supporting the classification of 'Dant Manjan Lal' as an Ayurvedic medicine, emphasizing its ingredients and manufacturing process.

6. The revenue contended that 'Dant Manjan Lal' should be classified under Heading 3306 as a tooth powder, not a medicine, based on common parlance and specific tariff notes excluding certain products from Chapter 30.

7. The revenue also highlighted Chapter Notes excluding certain products from Chapter 30 and 33, arguing that 'Dant Manjan Lal' did not meet the criteria for classification as a medicament.

8. The Tribunal agreed with the appellants, emphasizing the need to classify 'Dant Manjan Lal' based on tariff entries. It noted the Supreme Court's decision on the product's eligibility for exemption and the relevance of the new Central Excise Tariff.

9. The Tribunal analyzed the relevant tariff entries and found that 'Dant Manjan Lal' did not qualify as a medicament under Chapter 30 based on the evidence presented and the absence of references to ancient books for the formula.

10. The Tribunal concluded that 'Dant Manjan Lal' should be classified as a tooth powder under sub-heading 3306, considering its daily use and lack of evidence supporting its classification as a medicament under Chapter 30.

11. The appeals were remanded for further orders, rejecting the earlier classification under Chapter 30 and affirming the tooth powder classification under Chapter 33.