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Issues involved: Appeal against Order-in-Original regarding classification of Rasam Mix, Sambar Mix, and Badam Feast under various headings and availability of exemptions claimed under Notifications.
Rasam Mix and Sambar Mix Classification: The appellants claimed classification under Chapter 9, specifically under Heading 9.03, 21.03, and 21.04. The Tribunal found that since the products contained elements other than spices like dhal and vegetable oil, they could not be considered mere mixtures of spices under Chapter 9. The addition of these extra ingredients made the products lose their essential character as spices, ruling out classification under Chapter 9. The Tribunal classified both products under Heading 21.04 as preparations for soups or broths, as they required only addition of water to obtain the desired foodstuff, sambar or rasam. Exemptions and Remand: The appellants claimed exemption under Notifications 4/93-CE and 2/94-C.E. for products classified under Heading 21.04. The Tribunal noted that the original authority had not considered the applicability of these Notifications due to a wrong presumption of lack of seriousness by the appellants. The matter was remanded to the original authority for re-examination on merits regarding exemptions and re-computation of duty and penalty. Badam Feast Classification: The appellants claimed classification under Heading 20.01 as preparations of nuts for Badam Feast. The Tribunal found that the product, a combination of sucrose, saffron, cardamom, almond, and milk powder, did not qualify as a mere preparation of nuts. It was classified under Heading 21.08 as a preparation for beverages, as it required further dissolution in milk before consumption. Extended Period and Penalty: The Tribunal held that the extended period for demand confirmed on Badam Feast was applicable as the appellants had not submitted any declaration despite their belief in exemption under Chapter 20. The decision of the Larger Bench in Nizam Sugar Factory case was cited to support the availability of the extended period due to initial suppression of facts. Conclusion: The appeal succeeded partially, with the matter remanded to the original authority for re-computation of duty, re-examination of exemptions, and re-adjudication of penalty considering the revised classifications. The eligibility for SSI exemption was to be reviewed in light of the new classifications under Heading 21.04.
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