2012 (9) TMI 341 - AT - Central Excise

Classification - manufacture of Potato wafers Held that - Rings made out flour of rice, wheat and potato; the dry pellets are obtained by the respondent from M/s. TTK Pharma Ltd - dry pellets are fried and after adding salt and flavours, the same are packed in unit containers for sale - Since the goods, in question, are snacks (Namkeens), the same are covered by serial No. 3 of the table of Notification No. 4/97-C.E., dated 1-3-1997 and hence the benefit of duty exemption has been rightly extended - Revenue s appeal is dismissed.

Summary

Issues:
Classification of "rings" as Namkeens or Pasta under Tariff - Duty exemption under Notification No. 4/97 - Appeal against Commissioner (Appeals) order.

Classification Issue:
The case involved a dispute over the classification of "rings" packed in unit packs for retail sale, which were ready-to-eat snacks, as either Namkeens under sub-heading 2108.99 of the Tariff or Pasta under Heading 19.02. The appellant argued that since the ingredients used were similar to pasta, the product should be classified under Heading 19.02. On the other hand, the respondent contended that the product was a Namkeen made from flour of rice, wheat, and potato, and should be classified under sub-heading 2108.99. The Tribunal examined the ingredients, preparation process, and previous judgments to determine that the product was indeed a Namkeen and not Pasta, thus eligible for duty exemption under Notification No. 4/97.

Duty Exemption Issue:
The Assistant Commissioner had initially classified the product as "other edible preparations" under sub-heading 2108.99, granting duty exemption under Notification No. 4/97. The Revenue filed an appeal against this decision, which was dismissed by the Commissioner (Appeals). The appellant argued that the Tribunal's judgment in a previous case had not been accepted by the department, leading to a pending civil appeal before the Apex Court. However, the respondent defended the Commissioner's order, citing similarities with a previous Tribunal judgment regarding a similar product. The Tribunal upheld the duty exemption under Notification No. 4/97, emphasizing that the product was correctly classified as Namkeen and thus eligible for the exemption.

Appeal Against Commissioner (Appeals) Order:
The Revenue filed an appeal against the Commissioner (Appeals) order, challenging the classification and duty exemption granted to the product. After hearing arguments from both sides and examining the facts, the Tribunal concluded that the product in question was indeed a Namkeen, distinct from Pasta, and correctly classified under sub-heading 2108.99. Furthermore, the Tribunal noted the absence of any stay on the previous Tribunal judgment cited by the respondent, reinforcing the validity of the classification as Namkeen. Consequently, the Tribunal dismissed the Revenue's appeal, affirming the duty exemption under Notification No. 4/97.

In conclusion, the Appellate Tribunal CESTAT, New Delhi, upheld the classification of the product as Namkeen under sub-heading 2108.99 of the Tariff, granting duty exemption under Notification No. 4/97. The Tribunal dismissed the Revenue's appeal against the Commissioner (Appeals) order, emphasizing the distinct nature of the product as a snack and its eligibility for the exemption. The judgment highlighted the importance of previous Tribunal decisions and the absence of any stay on relevant judgments, reinforcing the validity of the classification and duty exemption in this case.