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TMI Blog2017 (9) TMI 1489X X X X Extracts X X X X X X X X Extracts X X X X ..... ation on the issue. Even in respect of imported Palm Stearin, there was a debate on classification - imposition of penalties is a overkill and is set aside. Appeal allowed - decided partly in favor of appellant. - E/30457/2016 - A/31517/2017 - Dated:- 15-9-2017 - Mr. M.V. Ravindran, Member (Judicial) And Mr. Madhu Mohan Damodhar, Member (Technical) Shri Harish Bindumadhavan, Advocate for the Appellant Sh. R. Narasimha Murthy, Superintendent (AR) for the Respondent ORDER [Order Per : Madhu Mohan Damodhar] 1. The facts of the case are that the appellant has a manufacturing unit for manufacture of Refined Palm oil, Refined Palm Stearin etc. and were availing exemption from payment of Central Excise Duty vide Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an made oral and written submissions, which can be broadly summarised as under: (i) RBD Palm Stearin manufactured by the appellant should be classified under CETH 1511 and not under CETH 3823. (ii) Tariff Heading 1511 covers crude as well as refined, bleached and deodorized (RBD) palm oil and its fractions as long as they are not chemically modified. Therefore, fractions of fats or oils obtained from fractionation, whereby chemical structure of fats or oils do not undergo any change are covered under Chapter 15. Tariff Heading 1511 cover fats and oils which are esters of glycerol with fatty acids and are not composed of free fatty acids. (iii) CETH 3823 covers industrial monocarboxylic fatty acids generally manufactured by sap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under Stearic Acid is a chemically modified product as explained in detail below, as against RBD Palm Stearin which is derivtive of the physical process, namely Fractionation without being chemically modified and is to be classified under Tariff 1511 9090. 4. On the other hand, on behalf of the Department, Ld. AR, Shri R. Narasimha Murty supports the impugned order. He further submits that chapter heading 3823 11 11 covers palm stearin and that there is a specific entry in 3823 1112 for RBD palm stearin. He also draws our attention to the judgment of Hon ble Supreme Court in the case of CCE, Visakhapatnam Vs. Jocil Ltd vide order dated 15.12.2010, wherein the Apex Court held that RBD Palm Stearin is covered under CETH 3823 1112 r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onation process other than RBD palm stearin, fractions like RBD Palm Olein etc. also emerge. RBD palm stearin is used in shortening industry. It is also used in soap, candle and oil chemical industries. The flow chart giving the process showing the Palm oil Fractionation process is reproduced below: 6.4 From the facts on record, it emerges that show cause notice dated 08.03.2012 was issued in respect of Refined Palm Stearin cleared during the months September 2008 to March, 2009 by appellant under claim of CETA 1511 9090 and exemption benefit under notification No. 03/2006-CE. In reply to the show cause notice dated 18.05.2012, appellants stated that they classified the palm stearin under tariff item 1511 9090 based on the bonafide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.8 Appellants have contended that the impugned RBD Palm stearin can be classified under CETH 1511 only, since palm oil and its fractions would merit entry under that heading as they are not chemically modified. Nonetheless, RBD Palm Stearin is not specifically incorporated as a separate sub heading thereat. No doubt, CETH 1511 has separate three dash (---) sub heading entries for fractions of crude palm oil, as follows: 1511 9010 --- Refined bleached deodorised palm oil 1511 9020 --- Refined bleached deodorised palmolein. 1511 0 --- Other Discernably, while there exist specific sub headings for RBD Palm Oil (1511 9010) and RBD palmolein (1511 9020), there is no separate and specific sub heading for RBD Palm Stearin in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sponding entry in Central Excise Tariff Act . Hence, we hold that the ratio set out by Hon ble Apex Court in the Jocil judgment will have relevance for this case also. Accordingly, even as per this CBEC circular, the impugned Refined, Bleached and Deodorised (RBD) Palm stearin manufactured by the appellants will merit classification under CETH 3823 11 12 only. 7. Viewed in the totality of the discussions hereinabove, we are unable to find any infirmity in that part of the order of lower appellate authority, upholding the demand of differential duty of ₹ 46,36,994/- with interest liability thereon and the same is sustained. Appeal on the differential duty liability is therefore rejected. So ordered. 8.1) However, coming to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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