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TMI Blog2001 (3) TMI 839X X X X Extracts X X X X X X X X Extracts X X X X ..... spute, the jurisdictional Assistant Collector of Central Excise passed order dated 31-12-92 confirming classification of the products viz. Camphor Powder (Technical Grade) and Isoborneol under CSH 2914.20 and 2906.90 respectively. The Assistant Commissioner s decision was affirmed by the Collector (Appeals) as per order passed on 31-3-94 in the appeal filed by the assessee. The present Appeal No. E/1070/94-C of the assessee is against the order of the lower appellate authority. 1.2 The appellants had filed classification list No. 458/91-92 with effect from 3-3-92 classifying their products under CSH 3307.41. But the Assistant Collector, without recourse to SCN proceedings, modified the classification of the products as under CSH 2914.20 and 2906.90 and made endorsements to this effect in the classification list on 25-1-93. The party preferred appeal to the Collector (Appeals) but the latter, as per the aforesaid (common) order dated 31-3-94, upheld the lower authority s decision. Hence the assessee s Appeal No. E/1071/94-C before the Tribunal. 1.3 The appellants had re-named their products Camphor Powder (Technical Grade) and Isoborneol as Karpooram and Pach Karpooram respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sifiable under CSH Nos. 2914.20 and 2906.90 respectively. In arriving at the decision, they also relied on the Tribunal s decision in the case of Collector v. Atul Products [1985 (20) E.L.T. 147]. The adjudicating authority had considered the merits of the rival claims for classification of the products. In dealing with the assessee s claim under CSH 3307.41, that authority referred to HSN Notes on Heading No. 3307.41 and reached a finding that their products were not agarbatti or dhoop or similar preparation to merit classification under CSH 3307.41. The said authority, further ruled out classification under the sub-heading in terms of Chapter Note 2 to Chapter 33 of the Tariff Schedule. It also found that the description of CSH 3307.41 was not specific and hence Rule 3(a) of the Rules of Interpretation was not invocable for classifying any product under that sub-heading. In considering the Department s claim as set out in the SCN for classifying the products under CSH Nos. 2914.20 and 2906.90, the adjudicating authority referred to Chapter Note 1(a) to Chapter 29 and, after an elaborate discussion on the process of manufacture, recorded a finding that in Camphor Powder (Technic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s claim, he faulted it by relying on the Chemical Examiner s report and Chapter Note 1(a) to Chapter 29. The Chemical Examiner had reported that each of the two products was a mixture of various compounds and hence could not be a separate chemically definded compound to fall within the coverage of Chapter 29. Ld. Advocate gave a brief account of the process of manufacture of the products and submitted that the minor ingredients of the final product were deliberately left in the product so as to render it particularly suitable for burning and were, therefore, to be considered as impurities not permissible in terms of Chapter Note 1(a). The products with such impermissible impurities stood excluded from Chapter 29. In this connection, he relied on HSN Explanatory Notes to the term impurities occurring in Chapter Note 1(a). Ld. Counsel also relied on the Deputy Chief Chemist s opinion regarding classification of the products. He submitted that the order of the Collector (Appeals) was not sustainable for the aforesaid reasons and on the further ground that the order was not a speaking order on all issues raised by the party. 6. Ld. JDR, Sh. S.P. Rao, who argued the Revenue s case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty Chief Chemist, reported as under :- Sample Camphor Sample Isoborneol 1. Camphor 76.9% 20% 2. Isoborneol 14.4% 73.3% 3. Camphene 1.6% 2.3% 4. Fanchone 0.5% 0.1% 5. Ferri Alcohol 2.3% 1.4% 6. Isoborneol Acetate 0.4% 0.4% 7. Borneol 3.1% 1.7% 8. High Boilers 0.8% 0.8% The Chemical Examiner, further, opined that the products might not fall under Chapter 29 as they were not well-defined organic compounds. He also suggested classification of the goods under Chapter 33 or 38 of the Tariff Schedule. The Assistant Collector and the Collector (Appeals) considered the above percentage composition and classified the products under Chapter 29 on the basis of their finding that the major ingredient (camphor or isoborneol, as the case may be) in each product was a chemically defined organic compound and the minor ingredients, which were also noted to be chemically defined organic compounds, were only permissible impurities in terms of Chapter Note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levant Explanatory Notes to HSN. 7.3 No doubt, the Chapter Headings and sub-headings under reference are patterned on the HSN. Chapter Note 1(a) to Chapter 29 of the Tariff Schedule and Chapter Note 1(a) to Chapter 29 of the HSN are identically worded. The relevant Explanatory Notes (HSN) on Chemically defined compounds mentioned in Chapter Note 1(a) are as under : A separate chemically defined compound is a single chemical compound of known structure, which does not contain other substances deliberately added during or after its manufacture (including purification). Accordingly, a product consisting of saccharin mixed with lactose, for example, to render the products suitable for use as a sweetening agent is excluded from this Chapter (see Explanatory Note to Heading 29.25). The separate chemically defined compounds of this Chapter may contain impurities [Note 1(a)]. An exception to this rule is created by the wording of Heading 29.40 which, with regard to sugars, restricts the scope of the heading to chemically pure sugars. The term impurities applies exclusively to substances whose presence in the single chemical compound results solely and directly from the manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e relied on the Chemical Examiner s opinion that the products might not fall under this Chapter. But such opinion has no persuasive effect on us since the core function of Tariff classification is beyond a Chemical Examiner s realm and the aforesaid opinion was given without reference to the HSN. 7.4 It was argued by ld. Advocate that the products in question were covered by similar preparations in whatever form mentioned against TSH (Tariff sub-heading) 3307.41. The corresponding HSN sub-heading as well as Chapter Note (2) to Chapter 33 of the Central Excise Tariff (CET) Schedule were also relied on by him in support of the argument. The CET and HSN entries are extracted below :- CET - Preparations for perfuming or deodorizing rooms, including odoriferous preparations used during religious rites : 3307.41 -- Agarbatti , Dhoop and similar preparations in whatever form. HSN - Preparations for perfuming or deodorizing rooms, including odoriferous preparations used during religious rites : 3307.41 -- Agarbatti and other odoriferous preparations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the relevant period. The goods so cleared did not satisfy the requirements of Chapter Note 2 to Chapter 33 of the Tariff Schedule read with Chapter Note 3 to Chapter 33 of the HSN inasmuch as the goods as cleared by the assesses during the relevant period were not put up in packings of a kind sold by retail for use as incense in religious rites, with label, literature or other marks indicating that the products were meant for such use. The 25 Kg. blocks cleared by the party were not shown to be clearly specialised to the aforesaid use as incense in religious rites, nor did they carry any label, literature or other indication as above during the relevant period. This apart, the goods were not shown to be suitable for use as incense. In this context, we observe that, though the scriptures cited by ld. Advocate could bring home to us the indispensability and sacredness of incense in Hindu religious rites, they could not establish that the impugned goods were suitable for use as incense in such rites. Suitability for use as incense, in relation to the products, must, in our view, be taken to mean that they had more or less the same incendiary properties as those of Agarbatti and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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