2001 (5) TMI 108 - AT - Central Excise

Summary

Issues Involved:
1. Classification of raw sugar syrup under chapter sub-heading 1702.30 of CETA.
2. Marketability and shelf life of raw sugar syrup.
3. Compliance with the remand order's directives.
4. Validity of the Chief Chemist's test report.
5. Applicability of Board's Circulars and Tribunal's judgments.

Detailed Analysis:

1. Classification of Raw Sugar Syrup under Chapter Sub-heading 1702.30 of CETA:
The appellants challenged the classification of raw sugar syrup under chapter sub-heading 1702.30 of the Central Excise Tariff Act (CETA), arguing that the syrup was not stable, lacked shelf life, and was not marketable. The Assistant Commissioner, in his Order-in-Original, concluded that the raw sugar syrup manufactured by the appellants contained citric acid, had a shelf life, and was marketable, thus classifiable under chapter sub-heading 1702.30 and dutiable at 10% ad valorem.

2. Marketability and Shelf Life of Raw Sugar Syrup:
The appellants contended that the raw sugar syrup did not have a shelf life and was not marketable. However, the Chief Chemist's report indicated that the sugar syrup contained citric acid and did not show any signs of deterioration over fifty days, thus proving its shelf life. The Assistant Commissioner and Commissioner (Appeals) both concluded that the syrup was marketable and dutiable based on its shelf life and the presence of citric acid.

3. Compliance with the Remand Order's Directives:
The Tribunal had previously remanded the matter for de novo consideration, instructing that if citric acid was added and the concentration of sugar was 65% or more, the appellants would be liable to pay duty. The appellants argued that the remand order's directives were not properly adhered to, as the Department did not establish the sugar content or the presence of citric acid conclusively. However, both the Assistant Commissioner and Commissioner (Appeals) upheld the findings that the syrup was marketable and dutiable, complying with the remand order's directives.

4. Validity of the Chief Chemist's Test Report:
The appellants claimed that the Chief Chemist's test report was vague and non-specific, arguing that it did not conclusively prove the presence of citric acid or the sugar content. Despite this, the Assistant Commissioner and Commissioner (Appeals) relied on the report, which indicated the presence of citric acid and the stability of the syrup, to conclude that the syrup had a shelf life and was marketable.

5. Applicability of Board's Circulars and Tribunal's Judgments:
The Commissioner (Appeals) referenced CBEC's Circular No. 226/60/96-CX, which stated that sugar syrup with a concentration of 65% by weight or more would have a shelf life even without citric acid. The Tribunal's judgments in similar cases, such as Hyderabad Bottling Co. Ltd. v. CCE, Hyderabad, and Cadbury India Ltd. v. CCE, Pune, were cited to support the classification and dutiability of sugar syrup under sub-heading 1702.30. The Tribunal upheld the impugned orders, noting that the appellants' product, 'Maaza,' was similar to those in the cited judgments and thus classifiable under the same sub-heading.

Conclusion:
The Tribunal dismissed the appeal, affirming the classification of raw sugar syrup under chapter sub-heading 1702.30 of CETA and its dutiability at 10% ad valorem. The findings of the Assistant Commissioner and Commissioner (Appeals) were upheld, concluding that the syrup was marketable, had a shelf life, and complied with the remand order's directives. The Chief Chemist's test report and relevant Board's Circulars and Tribunal's judgments were deemed valid and applicable.