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TMI Blog1993 (12) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... and hence claimed the classification `fungicide . 3. The Department examined their claim and found that the product is classifiable only as a preservative and not as fungicide on the following ground stated by the department in the show cause notice dated 27-10-1986 - Bronidiol is marketed only as `Broad spectrum preservative and used only as a `preservative in pharmaceutical products, cosmetics and in similar products where there is scope for deterioration of biological specimens thereby it prolongs the life of an organic material. It is neither sold nor used as fungicide. No statutory formality applicable for the manufacture and sale of fungicide is followed by M/s. T.T.K. Pharma Ltd. in respect of `bronidiol . Their contention that bronidiol contains fungicidal property also would not qualify it being called as fungicide . 4. They filed their reply to the show cause notice on 1-12-1986 contending that the product is a preservative because it is capable of killing different types of fungi and in the CET neither the term `preservative nor the term `fungicide is defined. They further contended that there are no formalities for nontoxic fungicides manufactured as `bronid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthorities had failed to examine their literature and also was not justified in rejecting their contention that the product was known commercially as fungicide. 7. We have heard Shri P.C. Anand, Chartered Accountant for the appellants and Shri K.K. Bhatia, Jt CDR for the respondents. Shri Anand submitted that the learned Asstt. Collector was not justified in rejecting the customer s letter which supported the appellants contention that the goods commercially were known as fungicide. This was also supported by the Chemical examiner s report. The Collector(Appeals) was wholly unjustified in rejecting the report also. He contended that the department did not dispute about the product having fungicidal qualities in as much as it was used to kill fungis and keep the cosmetics and medicines intact. The department also did not dispute its qualities of prescription and therefore, both the lower authorities were not justified in rejecting the appellants case. He relied on the ruling of Sarita Chemicals v. Collector of Central Excise reported in [1987 (30) ELT 434 (Tri.) = 1985 ECR 336] which held that Customs test report should not be rejected. 8. Shri Bhatia, learned Jt. CDR supported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itrated or nitrosated derivatives 2902.90 Other 15% 29.05 Aldehyde-function compounds 15% 2905.90 Other 15% 38.01 Miscellaneous products of the chemical or allied industries (including those consisting of mixtures of natural products) not elsewhere specified or included 3801.20 Insecticides, fungicides, herbicides, weedicides and pesticides Nil 10. The literature and letters of the customers are not produced before us for examination. We have to proceed on the basis of the available materials before us. The chemical report states that it is in the form of white crystalline solid and it is organic chemical and not a formulation. The Chemical examiner has examined technical books available with him and examining the definition of the preservative, has opined that it could be considered to possess fungicidal property. 11. It is admitted by the department that the product has fungicidal properties and it is used as preservative with a view to kill the fungicides. The appellants had produced their product literature and their customers letters, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowed. So long as the trade understands the product to be a fungicide and it is used for such a purpose which is not denied in this case, then the product has to be considered as such. 13. The Asstt. Collector has classified the product under TI 2902.90 from 1-3-1986. This entry covers `other under menthol which comes under sub-heading alcohols and their halogenated, sulphonated, nitrated or nitrosated derivatives. The chemical examiner s report does not suggest that it falls under this tariff entry. It cannot be made out from the lower authorities orders as to from where they have got the material to concur this product to be coming under this tariff entry. Hence, the classification under this tariff entry is not appropriate. 14. Tariff entry 2905 of CET 1987 reads acylic alcohols etc. as noted above; 2905.10 refers to Methanol and 2505.90 is other. Even for this, there is no evidence for classifying it. Therefore, the lower authorities order classifying the product `Bronidiol under these two headings TI 2902.90 of CET 86 and TI 2905.90 of CET 1987 has to be set aside and the prayer for classification under sub-heading 3801.20 of 1986 CET has to be accepted by allowing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision in the case of Collector of Central Excise, Bombay v. Bombay Chemicals Pvt. Ltd., Bombay and Standard Chemical Pharmaceutical Co. Bombay, reported in 1986 (24) E.L.T. 373 (Tribunal). In that case, a claim was made for exemption in terms of Notification 55/75-C.E. for the disinfectant fluids manufactured by the appellants therein for exemption against the Notification Entry Insecticides, pesticides, weedicides and fungicides . The Tribunal observed .......... the juxtaposition of the four terms, which indicate distinct uses or applications should be taken as referring to substances which are recognised as respectively suited to those applications . Therefore, observation of the Tribunal in para-56 thereof also pertinent which is reproduced below :- It will not do to say an insecticide is a germicide because it has the ability to kill germs, any more than it will do to call a disinfectant, a well known commodity, a bactericide just because it can kill bacteria. The names bactericide, pesticide, fungicide, insecticide are each understood to designate a well-known product or compound even if it also acts in ways that the other products act. Their manufacturers produce a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In view of the difference of opinion arising between the two Members, the following point of difference is referred to the President in terms of Section 129 C (5) Customs Act as applicable to Central Excises and Salt Act, 1944 : Whether the product Bronidiol is a Fungicide classifiable under sub-heading 3801.20 Central Excise Tariff Act 1985, or whether the product being marketed as a preservative, and not as fungicide, cannot be classified under that heading and whether the lower authorities were correct in denying this classification to the product, and whether on the proper classification, other than under Chapter 38 Central Excise Tariff Act, the case needs to be remanded to jurisdictional Assistant Collector . Sd/- 29-10-1991 S.L. Peran) Member (J) Sd/- 29-10-1991 (K.S. Venkatramani) Member (Technical) 18. [Order per : Shri S.K. Bhatnagar, Vice President]. - This matter has been referred to me by the hon ble President in view of the difference of opinion between two Members on the following point : Whether the product Bronidiol is a Fungicide classifiable under Sub-heading 3801.20 Central Excise Tariff Act, 1985, or whether the product being marketed a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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