1997 (12) TMI 335 - AT - Central Excise

Summary

Issues:
Classification of product ProBoFex under Central Excise Tariff - Item 1B or Item 68, Exemption under Notification 234/82.

Analysis:
The case involved the classification of the product ProBoFex by the Assistant Collector under Tariff Item 68 instead of Item 1B, leading to the denial of exemption claimed under Notification 234/82. The Assistant Collector based the classification on the product's usage as a food supplement rather than food. The Collector (Appeals) reversed this decision, holding that the product qualifies as a food supplement under Item 1B, not falling under the category of drugs or medicinal preparations. The ld. SDR argued that the product does not meet the criteria for prepared or preserved foods under Item 1B, citing judicial decisions and dictionary meanings. The ld. Counsel for the respondent referenced Tribunal decisions supporting classification under Item 1B for similar products. The Tribunal ultimately upheld the Collector (Appeals) decision, classifying ProBoFex under Item 1B as prepared or preserved foods in unit containers.

The Tribunal considered various factors in reaching its decision. Firstly, a certificate from the Food and Drug Administration confirmed that ProBoFex is not a drug under the Drugs and Cosmetics Act. Secondly, while a previous Tribunal decision classified a similar product under Item 68, the respondents presented three Tribunal decisions favoring classification under Item 1B. These decisions highlighted the ingredient similarities and the classification of products as food supplements. The Tribunal found these precedents more compelling than the conflicting decision. The Tribunal also noted that similar products by other manufacturers were classified under Item 1B, supporting consistency in classification. The presence of "protein hydrolysate" as an ingredient further aligned ProBoFex with products classified under Item 1B. The Tribunal emphasized that the alternate classification considered in some cases did not affect the application of the decisions for classifying ProBoFex under Item 1B.

In conclusion, the Tribunal upheld the Collector (Appeals) decision, ruling that ProBoFex is correctly classified under Item 1B of the Central Excise Tariff as prepared or preserved foods in unit containers for sale. The Tribunal found no reason to disturb this classification based on the evidence presented and the precedents cited by the respondents. Therefore, the appeal was rejected, affirming the classification of ProBoFex under Item 1B and denying the exemption claimed under Notification 234/82.