1999 (8) TMI 265 - AT - Central Excise

Summary

Issues:
Classification of the product 3, 5-dinitro-ortho-tolumide (D.O.T.) under Chapter sub-heading No. 2302.00 or under Chapter sub-heading No. 2942.00 of the Central Excise Tariff.

Analysis:
In the appeal filed by the Revenue, the primary issue was to determine the correct classification of the product, D.O.T., under the Central Excise Tariff. The Asstt. Collector initially classified the product as an organic chemical under Chapter sub-heading No. 2942.00, contrary to being a preparation for animal feeding under Chapter sub-heading No. 2302.00. However, the Collector of Central Excise (Appeals) overturned this decision and classified the product under Chapter sub-heading No. 2302.00.

During the proceedings, the Revenue argued that D.O.T. is an organic chemical produced through a synthetic process involving specific raw materials. The Revenue emphasized that the term 'preparation' under Chapter sub-heading No. 2302.00 refers to a mixture of nutrients for animal feed, which does not align with a pure organic chemical like D.O.T. Reference was made to the HSN Explanatory Notes and a previous decision by a Larger Bench of the Tribunal to support this argument.

Upon review, the Tribunal found that the Collector (Appeals) had not adequately considered the distinguishing factors between Chapter sub-headings 2302.00 and 2942.00 in relation to the product in question. Contrarily, the adjudicating authority had thoroughly analyzed these aspects and correctly classified the product as an organic chemical falling under Chapter sub-heading No. 2942.00. The Tribunal also highlighted the precedent set by the Larger Bench decision, which clarified the classification criteria for animal feed preparations under the Central Excise Tariff.

Ultimately, applying the principles established in the aforementioned decision, the Tribunal concluded that the product in question, D.O.T., did not qualify as a preparation under Chapter sub-heading No. 2302.00 and should be classified under Chapter sub-heading No. 2942.00. Consequently, the impugned order was set aside, and the appeal of the Revenue was allowed.