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TMI Blog1994 (7) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... classifying the item under sub-heading 0901.20 was accepted by the Department but exemption denied under Notification No. 127/89-C.E. on the ground that Notification exempts coffee powder and not tablets. Notification No. 127/89, dated 27-4-1989 is as under :- In exercise of the powers conferred by sub-section (1) of Section 5A of the Central Excises and Salt Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 9/89-Central Excises, dated the 1st. March, 1989, namely :- In the said notification, in the Table, (i) S. No. 1, 2, 3 and 4 shall be re-numbered as S. Nos. 2, 3, 4 and 5 respectively, (ii) before S. No. 2 so re-numbered and the entries relating thereto, the following S. No. and entries shall be inserted, namely. 1) (2) (3) .1 0901.20 Cofee powder containing chicory in any proportion" He said that coffee chicory powder is marketed in packets of different weights varying from 50 gms. to one Kilogram under different bra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e covered by that definition under Section 2(b) of the West Bengal Sales Tax Act. 4. While countering the arguments Shri M.K. Jain, learned SDR submitted that whether compression is the process of manufacture or not is not the issue in the case but the product manufactured by the appellants is exempted in terms of Notification No. 127/89. The finished product is coffee/chicory tablet and compression of powder into tablet is a process incidental or ancillary to the completion of the manufactured product. Referring to the process of manufacture, he said that the following stages are involved in coffee tablet manufacture :- 1. Raw coffee beans are roasted and ground into coarse granules. 2. These granules are taken to mixer wherein chicory and the coffee granules are added in 49 : 51 ratio and into this mixer water is sprinkled through pipes and thoroughly mixed. 3 The semi-wet substance is kept in open basket - like vessels for a few hours to one or two days. 4 This substance is taken into a pressing machine wherein water is again added to give the substance sticky nature and poured into dyes and pressed by hammer like machine strongly and tablets emerge. 5 These t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffee powder and since notification exempts only coffee powder the Department was justified in denying the benefit of exemption to the product in question in terms of Notification No. 127/89 dated 27-4-1989. He emphasised that exemption Notification is to be construed strictly and referred to the following decisions :- 1. Tata Engg. Loco. Co. Ltd. v. Asstt. Collector of Central Excise ; 1990 (48) E.L.T. 182 (Bombay). 2. Gaya Cotton Jute Mills v. Union of India; 1992 (61) E.L.T. 569 (Pat.). 3. Union of India v. Wood Papers Ltd.; 1990 (47) E.L.T. 500 (SC). 4. Collector of Customs v. Marine Mercantile Co.; 1993 (63) E.L.T. 452 (Tribunal). 5. We have carefully considered the submissions made by both sides with reference to the facts and perused the records including citations. Collector(Appeals) is not correct in arriving at the conclusion that process in this case amounted to manufacturing process relying upon the decision in the case of Om Prakash Gupta v. Commerical Tax Officer (Supra) because of the fact that in that decision, High Court has considered the term dealer with reference to Section 2(b) of the West Bengal Sales Tax Act and High Court gave the finding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the appellants that tablets if powdered become coffee powder again and composition, character and use of the tablets are the same as that of coffee powder. In the facts and circumstances of the case and in view of the fact that notification exempts coffee powder containing chicory in any proportion and tablets are also classifiable under Heading 0901.20, we do not find any justification to deny the benefit of exemption in terms of Notification merely on the ground that coffee powder was in different form or in the shape of tablets. 6. In the view we have taken, we set aside the impugned order and, accordingly, the appeal is allowed. 7. [Assent per : S.K. Bhatnagar, Vice President]. - I observe that learned D.R. has drawn our attention to the coffee products mentioned in the Wealth of India `Industrial Products Part II . This book shows that coffee is also marketed in the form of the tablets, flake coffee and prepared coffee. Coffee tablets are produced in India on a small scale. Flake and prepared coffee are not manufactured. For the preparation of tablets ground coffee is mixed with chicory powder and mixture pressed in a tableting machine after the addition of a binding ..... X X X X Extracts X X X X X X X X Extracts X X X X
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