M/S Morvi Vegetable Products Ltd vs Commissioner Of Customs, Kandla

Appeal No.C/155/2007-DB [Arising out of OIA No.09/2007-KDL/Cus/Commr.(A)/AHD, dt.31.01.2007, passed by Commissioner (Appeals), Central Excise & Service Tax, Ahmedabad]

M/s Morvi Vegetable Products Ltd. Appellant

Vs

Commissioner of Customs, Kandla Respondent

Represented by:

For Appellant: Shri P.D. Rachch, Advocate For Respondent: Shri T.K. Sikdar, Authorised Representative

For approval and signature:

Honble Mr. P.K. Das, Member (Judicial) Honble Mr. H.K. Thakur, Member (Technical)

1. Whether Press Reporters may be allowed to see the No Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether their Lordships wish to see the fair copy of Seen the order?

4. Whether order is to be circulated to the Departmental Yes authorities?

CORAM:

HONBLE MR. P.K. DAS, MEMBER (JUDICIAL) HONBLE MR. H.K. THAKUR, MEMBER (TECHNICAL)

Date of Hearing/Decision: 08.04.2015

Order No. A/10303 / 2015, dt.08.04.2015

Per: P.K. Das

1. The Appellant imported Bakery Shortening classifiable under Heading No.1516 of Customs Tariff Act, availing exemption notification No.41/2005, dt.01.03.2005. According to the Revenue, the Bakery Shortening would be classifiable under Heading No.1517 and the Appellant is not eligible to benefit of exemption notification.

2. We find that the issue is no more res integra in view of the decision of the Tribunal in the case of Adani Wilmar Ltd Vs Commissioner of Customs Kandla  2012 (278) ELT 663 (Tri-Ahmd). The relevant portion of the said decision is reproduced below:-

6.?A careful reading of the HSN Notes will demonstrate that products under Chapter 1516 wholly and partly hydrogenated oils and are frequently used as constituents in the preparation of edible fats of heading 15.17. It is also clear that margarine, edible mixtures or preparation of animal or vegetable fats or oils wholly fall under heading 15.16, which are other than the edible fats or oils for their fractions of heading 15.16. In the instant case, it is absolutely clear that the goods merit classification under 15.16 and need not to go to the Chapter 15.17. We find that, for classifying the goods under Chapter heading 1517, it would be necessary to show that the same had been further prepared by a processes like emulsification, churning, texturation etc., to change the basic character of the same from being a product classifiable under Chapter heading 1516 to that of Chapter heading 1517.

7.?We also find that when the goods were removed no samples were taken nor any tests were conducted to ascertain the chemical nature or character of the goods imported. This considerably weakens the stand taken by the department in re-classifying the goods under Chapter 1517. In fact, the Revenue could not produce any such evidence in support of their case. The Honble Supreme Court in the case of Garware Nylons Limited - 1996 (87) E.L.T. 12 (S.C.) has well laid down certain guidelines in similar situations :-

15.?In our view, the conclusion reached by the High Court is fully in accord with the decisions of this Court and the same is justified in law. The burden of proof is on the taxing authorities to show that the particular case or item S4in question, is taxable in the manner claimed by them. Mere assertion in that regard is of no avail. It has been held by this Court that there should be material to enter appropriate finding in that regard and the material may be either oral or documentary. It is for the taxing authority to lay evidence in that behalf even before the first adjudicating authority. Especially in a case as this, where the claim of the assessee is borne out by the trade inquiries received by them and also the affidavits filed by persons dealing with the subject matter, a heavy burden lay upon the revenue to disprove the said materials by adducing proper evidence. Unfortunately, no such attempt was made. As stated, the evidence led in this case conclusively goes to show that Nylon Twine manufactured by the assessees has been treated as a kind of Nylon Yarn by the people conversant with the trade. It is commonly considered as Nylon Yarn. Hence, it is to be classified under Item 18 of the Act. The Revenue has failed to establish the contrary. We would do well to remember the guidelines laid down by this Court in Dunlop India Ltd. v. Union of India [1983 (13) E.L.T. 1566 (S.C.) = (AIR 1977 SC 597 - at page 607)], in such a situation, wherein it was stated:-

When an article has, by all standards, a reasonable claim to be classified under an enumerated item in the Tariff Schedule, it will be against the very principle of classification to deny it the parentage and consign it to an orphanage of the residuary clause. (Emphasis supplied) We respectfully follow the ratio of this judgment.

8.?In view of the facts and discussions as above, we find that the stand taken by the Revenue is unsustainable and the appeal filed by M/s. Adani Wilmar Limited is to be allowed classifying the goods under Chapter Heading 15162091, allowing exemptions from additional duty of excise under Notification No. 4/2005. Consequential relief, if any to the appellant, is also allowed.

3. After following the above decision of the Tribunal, we set aside the impugned order and allow the appeal with consequential relief.

(Dictated & Pronounced in Court)

(H.K. Thakur) (P.K. Das) Member (Technical) Member (Judicial)

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