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TMI Blog2016 (3) TMI 1043X X X X Extracts X X X X X X X X Extracts X X X X ..... 015 (appellant + three others) are filed against the OIO No. 3/2015 dated 11.02.2015, passed by the Commissioner of Central Excise, Chennai. 2. The brief facts of the case are that the appellant manufacture pesticides and plant growth materials and bio-fertilizers. The appellants in appeals No. E/510/10 and No. E/208/2010 are manufacturing Allwin Top powder, Allwin Wonder powder, Allwin gold 15 G Granules, Allwin XL granules, Rhino powder, Allwin gold-Liquid, Allwin XL-Liquid, Agrowet, Rishab-Liquid and Rock and classified them under CETSH 3101 0099 treating them as Animal/Vegetable fertilizers (or) bio-fertilizers. The department issued SCNs proposing to classify them under CETSH 3824 9090. The adjudicating authority in his orders classified the following goods under chapter 38 as under:- S. No. Name of the Product CETSH 1. Allwin Top powder, 3824 90 90 2. Allwin Wonder powder, 3824 90 90 3. Rhino powder, 3808 99 90 4. Allwin XL-Liquid, 3808 99 90 5. Rishab 3808 99 90 6. Rock 3808 99 10 7. Allwin gold 15 G Granules, 3808 93 40 8. Allwin XL granules, 3808 93 40 9. Allwin gold-Liquid, 3808 93 40 10. Agrowet, 3402 90 49 The Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rity has not disputed the contents of the goods but only rejected the classification under CETH 3105 purely based on the reasoning that their goods are not covered under Fertilizers Control Order, 1995 (FCO). Sr. Counsel drew attention of the Bench to the Board's Circular dated 24.05.1990 at page 87 and another Circular dated 21/11/1994 at page 88 and Circular dated 19.05.1998 at page 86. He also drew attention to chapter note 2 to chapter 61 and HSN explanatory note 6 annexed at page 6 & page 22 and submits that as per note 6 for the purpose of heading 3105, the term other fertilizers applies only to products of a kind used as fertilizers and containing as an essential constituent, at least one of the element is nitrogen phosphorous or potassium. For the purpose of classification, he submits that FOC is not relevant nor chapter note specified give any reference to FCO. He further drew attention to para 13, 13.1 & 13.5 of the OIO No. 3/2015 dated 11/02/2015 and submits that the adjudicating authority erroneously came to a conclusion that these are Plant Growth Regulators. 7. Further he submits that these goods are not classifiable under 3824 and drew attention to the Explanatory N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. He further submits that as per the chapter note 1 A sub-clause 2 of chapter 38 (1to 9 of the paper book), this chapter excludes the products which are chemically defined elements or compounds. In their case the goods are not chemically defined products but it is only a mixture. In support of his arguments, he relied on two Tribunal orders at page 106 2001 134 ELT 294 (Tri.-Del.) and 2001 131 ELT 355 (Tri.-Del.), where the Tribunal held that the goods are not covered under 38.08. He also drew our attention to HSN explanatory note at page 50 and also SCN para 13.1.4 (page 144 & 145), where the department concedes in the SCN that the composition of Allwin Gold is a mixture and not separate chemically defined compound. He submits that Allwin Gold is not classifiable under 38.08 and classifiable under 31.05. 10. Regarding Dosth, he submits that this product is supplied along with Allwin wonder plus, which is in combination pack. He further submits that "Dosth" is a wetting agent. He produced the sample of Alwyn wonder plus and submits that it contains small pouch of Dosth inside it. The main product Aliwin wonder plus is classifiable under 3105 and Dosth also is liable to be classif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere duly drawn and tested and the test report is available clearly shows that the contents nitrogen, phosphorous and potassium. Therefore, the facts are very clear and the matter need not be remanded and no longer res intergra. He has also countered that the Board's Circular dated 19.05.98 clearly shows that FCO is not relevant for classification of fertilizers under CET and also countered that Himgiri Metals Pvt. Ltd. (supra) relied upon by the Revenue is not applicable to the present case as it is for the exemption given under the notification. Whereas, in their case, classification of the goods under CET at nil rate of duty. 13. We have carefully considered the submissions by both sides and perused the records and all the three adjudication order and OIAs. As the appellants are not contesting the demand confirmed on the products such as Rishab, Allwin XL, Rock, Agrowet, Rhino in appeal E/510/2010, E/365/2011 are containing some insecticidal property but they are contesting only the products ie. 1. Allwin Gold, 2. Allwin Top, 3. Allwin Top plus, 4. Allwin Wonder, 5. Allwin Wonder Plus, 6. Allwin Legume, 7. Allwin Elixer, 8. Ramdoot, 9. Bolt, 10. Dosth. Out of these 10 products, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns contained in Board"s Circular No. 79/79/94-CX., dated 21-11-1994 [See 1994 (74) E.L.T. T46] wherein Board had clarified that Micronutrients listed under the Fertiliser (Control) Order, 1985 and their mixtures (with or without N.P.K.), as notified by the Central Government or a State Government would be classifiable under CET Chapter 31.05. 2. A doubt has been raised regarding classification of certain Micro- nutrients such as compounds of Zinc, Boron, Manganese, Molybdenum, Iron etc., which are required in minor quantities to regulate plant growth -whether classifiable as fertilisers (31.05), plant growth regulators (38.08) or as separate chemically defined compound (Ch. 28). 3. The matter has been re-examined in the light of Supreme Court judgment in the case of Ranadey Micronutrients v. Collector of Central Excise -Civil Appeal No.5404 of 1993, decided on 10-9-1996- 1996 (87) E.L.T. 19 (S.C.). Micronutrients are basically salts of elements such as Zinc, Boron, Manganese, Molybdenum, Iron, etc., known as trace elements. These are essential for plant growth in small amounts only and their absence leads to stunted growth. These elements are supplied in minor quantities to reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s categorically stated that the Notification issued under FCO is irrelevant for deciding the classification under CET and also clarified FCO order the classification should be based on whether the goods are chemically defined compound only then the classification under 3105 is ruled out. Secondly, where the products consist of nitrogen phosphorous and potassium as laid down in the explanatory notes, it falls under other fertilizers. If these two conditions are not met only then the products can be excluded from chapter heading 31.05. As it is seen from the finding of the adjudicating authority and the test reports, the composition of the mixture contains either nitrogen, potassium or phosphorous, which has already been brought out in para-13 of the OIO dated 11.02.2015 and admitted that these products contain elements of N.P.K. single or combination. We find that Allwin Wonder plus and Allwin wonder contains potassium and nitro benzene which has elements of both Nitrogen and potassium. In the case of Allwin Top plus and Allwin Top contains Mono ammonium phosphate, and potassium humate which contains both phosphorous and potassium. In the case of Allwin Legume and Allwin Elixier bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regulators. In the present case, it is only a mixture of chemicals which are sprayed as folio spray for enhancing the growth of the folio in the stage of blooming. Accordingly, we do not see any justification by the Revenue classifying the products under 3808 9340 as PGR. Therefore, we hold that Allwin Gold is rightly classifiable under 3105 9090. 19. As regards the last item "Dosth", we find that this product was not declared by the appellant nor it was cleared separately but kept in the packets as a combi-pack. On perusal of the sample packet of Allwin wonder plus, we find that Dosth is a wetting agent and kept inside the pack of Allwin wonder plus as 20 ml sachet. It is an option to the user to use this wetting agent comes with combi-pack. We rely on the Tribunal's decision in the case of Karamchand Appliances Pvt. Ltd. Vs. CCE, Chandigarh - 2012 (284) ELT 69, where the Tribunal dealt in the case of combi-pack the classification of the second item which contains in the main pack should be classified along with the main item. The relevant paragraphs are reproduced as under:- "13. In order to find answer to the aforesaid question, it is necessary to have a look on the relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... component which gives them their essential character, insofar as this criterion is applicable. (c) when goods cannot be classified by reference to (a) or (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit classification." 14. On reading of the above Rule 3 of interpretation, it is clear that since combi-pack comprises of two different articles classifiable under different chapters and sub-heading of the Central Excise Act, 1985, the classification of combi-pack would be governed by Rule 3(b) of the above quoted Rule. Rule 3(b) of above quoted Rule provides that in such a case, the goods put up in sets for retail sale shall be classified as if they consisted of material or component which give them essential character in so far as that criterion is applicable." The above citation squarely applicable to the present case. There is no dispute that that the appellants are not clearing the wetting agent separately. But it is packed inside Allwin Wonder plus and sell it as a combi-pack. Accordingly, we hold that Dosth is rightly classifiable under 3105 9090 along with the main item. 20. In view of the foregoi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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