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TMI Blog2008 (6) TMI 582X X X X Extracts X X X X X X X X Extracts X X X X ..... ered to align it with HSN. Commissioner found that simultaneously, Chapter Note No.2 of Chapter 33 covering essential oils, cosmetic and toilet preparations etc was amended deleting the following segment. with labels, literature or other indications that they were for use as cosmetics or toilet preparations or put up in a form clearly specialized to such use and included products whether or not they contained subsidiary pharmaceutical or anti septic constituents, or are held out as having subsidiary curative or prophylactic value . Till then Chapter Note 2 of Chapter 3 read as follows: Heading Nos.3303 to 3307 apply, inter alia, to products, whether or not mixed (other than aqueous distillates and aqueous solutions of essential oils), suitable for use as goods of these headings and put up in packings with labels, literature or other indications that they were for use as cosmetics or toilet preparations or put up in a form clearly specialized to such use and includes products whether or not they contain subsidiary pharmaceutical or antiseptic constituents, or are held out as having subsidiary curative or prophylactic value. Commissioner found that Shanti coconut oil-edib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upported the continued classification of the product as coconut oil even after 01.03.05. Board s interpretation of the entry prior to 01.03.05 put the impugned goods under Chapter 15. With the alignment of tariff entries with HSN, the impugned goods more correctly qualified for classification under Chapter 15. It is not the department s case that coconut oil is not covered by Chapter 15. Commissioner has classified only those goods in packing of and below two litres under Chapter 33. Ld. Counsel argued that the item was specifically covered by the entry in Chapter 15. The CBEC Circular No.145/56/95-CX dated 1.8.95 unambiguously covered the impugned goods under Chapter 15. CESTAT had held the classification to be Chapter 15 in the following case law. CASE LAW Commissioner had wrongly observed that the CESTAT had erred in these decisions. In India, coconut oil was mostly produced in Kerala and coconut oil was the widely used and choice medium of cooking of large sections of the country s population. Commissioner s findings to the contra were erroneous. During hearing the Ld Counsel for the appellants showed us certain cooking medium marketed under the brand name Pam packed in b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use as goods of these headings and put up in packings of a kind sold by retail for such use. 15.13 Coconut (copra), palm kernel or babassu oil and fractions thereof, whether or not refined, but not chemically modified (+). Coconut (copra) oil and its fractions 1513.11 Crude oil 1513.19 Other Note 3. Headings 33.03 to 33.07 apply, inter alia, to products, whether or not mixed (other than aqueous distillates and aqueous solutions of essential oils), suitable for use as goods of these headings and put in packings of a kind sold by retail for such use. 33.05 Preparation for use on the hair 3305.10 Shampoos: 33051010 Containing spirit 33051090 Other 33052000 Preparation For permanent waving or straightening 33053000 Hair Lacquers 3305.90 Other: - Hair oil 33059011 Perfumed 33059019 Other 33.05 - Preparation for use on the hair 3305.10 Shampoos 3305.20 -Preparation for permanent waving or straightening 3305.30 Hair lacquers 3305.90 - Other 5. The cardinal principle for classification is that, for legal purposes, one has to determine the classification according to the description given in the Heading No. under the tariff, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ote 3 of Chapter 15. It was also clarified that if the containers bore labels, literature etc. indicating that it was meant for the application on hair as specified under Note 2 of Chapter 33 and/or if the coconut oil had additives (other than BHL ) or had undergone processes which made it a preparation for use on hair as mentioned in Chapter 6 of Chapter 33 then the coconut oil merited classification under Chapter 33. In Amardeo Plastics Industries Vs. CCE, Belapur [2007 (210) ELT 360 (Tri. Mumbai)] Tribunal considered the above circular of the Board. In that case, the containers (HDPE bottles) carried the description edible oil and nowhere on the bottle it was written that it was meant for application on hair. The coconut oil had not undergone any processes or contained any additives. Noting these facts, the Tribunal observed that Chapter Note 2 of Chapter 33 excluded such oils from its purview. Accordingly it was held that coconut oil did not fall under Chapter Heading 33. That decision was also consistent with the following earlier decisions of the Tribunal cited in that case before it . In the above decision the Tribunal analysed the scope of Chapter Note 2 to Chapter 33 and o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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