Commercial description controls exemption for detergent cakes despite tariff sub-classification under Chapter 34.

Detergent cakes classifiable under Heading 3401.20 were held to qualify for exemption under Serial No. 3 of Notification No. 88/88 because the notification covered laundry soap and carbolic soap under Chapter 34, and the goods were known and used in the market as laundry soaps. Serial No. 26, which applied to synthetic detergent under Heading 34.02, did not extend to these goods. The decisive consideration was the commercial description of the product in the market, so tariff sub-classification did not defeat exemption where the goods answered the notification description.

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Issues: Whether detergent cakes classifiable under Heading 3401.20 were entitled to exemption under Serial No. 3 of the table annexed to Notification No. 88/88, and whether exclusion under Serial No. 26 applied.

Analysis: Serial No. 26 covered synthetic detergent falling under Heading 34.02 and therefore did not extend to the goods, which were classifiable under Heading 3401.20. Serial No. 3, however, covered laundry soap and carbolic soap falling under the whole of Chapter 34. The description in the notification was not harmonised with the tariff classification, and the decisive consideration was whether the goods were known and used in the market as laundry soaps. Since the manufactured goods were detergent cakes used as soaps for washing laundry, they could not be denied exemption merely because they fell under Heading 3401.20.

Conclusion: The goods were entitled to exemption under Serial No. 3 of Notification No. 88/88 and not excluded by Serial No. 26.

Final Conclusion: The appeal succeeded and the exemption claim was upheld, with consequential relief granted.

Ratio Decidendi: Where an exemption entry covers goods by commercial description and extends to the relevant chapter, tariff sub-classification will not defeat exemption if the goods answer the notification description and are known in the market by that description.

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