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2016 (4) TMI 842 - SC - Central ExciseClassification - Tetmosol soap - whether falls under CET Heading 3401.11 or CET Heading 3401.19 - Held that - there is no dispute that the soap is a medicated soap and it contains monosulfiran B.P. 5% w/w. It is primarily used for treatment and prevention of scabies which is a contagious skin affliction that is characterized by itching and sores. There is nothing to prevent anybody from using medicated soap for toilet purposes but it is not what the soap is intended for. Clearly, the product in dispute is classifiable under CET Heading 3401.11 which is the more appropriate CET Heading rather than the residuary CET Heading 3401.19. Tribunal s order is set aside. - Decided in favour of appellant
Issues: Classification of Tetmosol soap under CET Heading 3401.11 or 3401.19
The judgment by the Supreme Court involved the classification dispute of Tetmosol soap under CET Heading 3401.11 or 3401.19. The appellant claimed that the soap, primarily used for treating scabies, should be classified under 3401.11 for medicated soaps. On the other hand, the Revenue argued that since the soap's wrapper mentioned it could be used as a toilet soap, it should fall under 3401.19 for toilet soaps. The Customs, Excise and Service Tax Appellate Tribunal (the Tribunal) analyzed the soap's composition and purpose, concluding that Tetmosol soap, containing monosulfiran B.P. 5% w/w, was primarily intended for treating scabies, a contagious skin affliction. The Tribunal found that while the soap could be used for toilet purposes, its main purpose was medicinal. Therefore, the Tribunal classified the soap under CET Heading 3401.11 as a medicated soap, not under the residuary CET Heading 3401.19. The Supreme Court disagreed with the Tribunal's decision, stating that the soap's intended use for treating scabies made it more appropriate for classification under CET Heading 3401.11 for medicated soaps, rather than the general classification under 3401.19. The Court held that the Tribunal erred in classifying Tetmosol soap under the residuary entry and set aside the Tribunal's order, allowing the appeals with no costs awarded.
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