Brand-labeled tobacco deemed manufactured goods under tariff note when marketability treatment satisfied, confirming classification as branded tobacco.

CESTAT, Mumbai held that tobacco marketed with the label "SAI Bhaiaki Mishri" was correctly treated as branded manufactured tobacco under Heading 2404.90. Chapter Note 2 to Chapter 24 deems labelling, relabelling, repacking, or any other treatment that renders goods marketable to the consumer as manufacture for goods under Headings 2401 to 2404. Because the product bore a brand label, the statutory condition of deemed manufacture was satisfied, and the classification adopted by the lower appellate authority was consistent with the tariff and the applicable note. The appellate order in favour of the manufacturer was upheld and the Revenue's challenge was rejected.

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Issues: Whether the respondent's product, being tobacco marketed with the label "SAI Bhaiaki Mishri", was liable to be treated as branded manufactured tobacco falling under Heading 2404.90 of the Schedule to the Central Excise Tariff Act, 1985.

Analysis: Chapter Note 2 to Chapter 24 of the Schedule to the Central Excise Tariff Act, 1985 provides that, in relation to goods under Headings 2401, 2402, 2403 and 2404, labelling or relabelling of containers, repacking from bulk packs to retail packs, or any other treatment to render the product marketable to the consumer amounts to manufacture. Since the product bore the label "SAI Bhaiaki Mishri", the condition of deemed manufacture was satisfied. The classification adopted by the lower appellate authority was therefore consistent with the tariff entry and the statutory note governing manufacture.

Conclusion: The product was correctly treated as branded manufactured tobacco under Heading 2404.90, and the Revenue's challenge failed.

Final Conclusion: The appellate order in favour of the manufacturer was upheld, and the Revenue appeal was rejected.

Ratio Decidendi: Where the tariff note deems labelling or similar marketability-oriented treatment as manufacture, a product bearing a brand label is classifiable as manufactured goods if the statutory conditions are satisfied.

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