C. Ex. Evasion of Central Excise duty by the manufacturers of Nirma and other Soap Manufacture - Central Excise - 34/30-11/MP/88

C. Ex. Evasion of Central Excise duty by the manufacturers of Nirma and other Soap Manufacture F. No. CH. 34/30-11/MP/88 Dated 4-7-1988 Government of India Ministry of Finance (Department of Revenue) Central Board Excise and Customs, New Delhi Subject : C. Ex. Evasion of Central Excise duty by the manufacturers of Nirma and other Soap Manufacture. Please refer to Board's letter No. 207/95/88-CX.6, dated 10-6-1988, on the above subject. 2. In this connection this is to inform that M/s. Nirma Chemical Works are manufacturing Toilet Soap and one of the Raw Materials used in the manufacture of Toilet Soap in ALPHA OLEFIN SULPHONITE (A.O.S.). The unit is paying duty 15% Adv. in terms of the Notification No. 39/87-C.E., dated 1-3-1987 as amended by Notification No. 39/88-C.E., dated 1-3-1988. 3. The jurisdictional Assistant Collector Central Excise had drawn a sample on 11-3-1988 to determine the contents and to determine the product for proper classification and also to ascertain the contents of the Toilet Soap. The Chemical Examiner, Central Excise Baroda had reported as under :- Report : "The sample described as Toilet Soap is in the form of coloured soap cake. It is composed of 76% calculated as sodium palmitate, small amount of colouring matter, perfume, moisture and fillers." The Jurisdictional Assistant Collector Central Excise had also requested the Chemical Examiner, Central Excise, Baroda to clarify the percentage of the active matters contained in the products. The Chemical Examiner, Central Excise, Baroda informed vide his office letter No. AH/34/Soap/87-88/6790, dated 26-4-1988 (copy enclosed), that the major constitute is soap about 76%, the presence or absence of small amount of organic surface active agent does not matter. The Chapter Note-3 of Chapter-34 is only meant to define 'Organic surface active agent' and not a preparation/product thereof and as such it is irrelevant for the product under reference. 4. It is mentioned that as per HSN notes even soft soap could contain organic surface active agents. Therefore, mere presence of small quantity of O.S.A.A. in a soap may not warrant its classification under sub-heading No. 3401.20. The product is classified under 3401.10.