Tribunal allows appeal, goods not under CET 9027.00, not instruments/appliances for medical use.

The appeal was allowed, setting aside the duty demand and penalty. The Tribunal clarified that the goods do not fall under CET 9027.00 but did not accept the contention that they fall under CET 9018.00, as they are neither instruments nor appliances used in medical, surgical, dental, or veterinary sciences but appear to be articles of plastics used in laboratories.

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Issues Involved:
1. Classification of goods u/s CET sub-heading 9027.00 vs. 9018.00.
2. Demand for duty and imposition of penalty.

Issue 1: Classification of Goods
The primary issue for determination is whether the goods manufactured by the appellants fall for classification under CET sub-heading 9027.00 as held by the Revenue or under CET sub-heading 9018.00 as contended by the assessee. The rival entries are:
- 9018.00: Instruments and appliances used in medical, surgical, dental, or veterinary sciences.
- 9027.00: Instruments and apparatus for physical or chemical analysis.

The Commissioner, in paragraph 42 of the impugned order, detailed the raw materials and end-use of each item. It was noted that none of the items in dispute are instruments or apparatus for physical or chemical analysis, nor for measuring or checking viscosity, porosity, expansion, or quantities of heat, sound, or light. Despite this, the Commissioner relied on HSN explanatory notes to Heading 90.18, which exclude instruments and appliances used in laboratories to test blood, tissue fluids, urine, etc., and classify them under Heading 90.27. However, the Commissioner himself acknowledged that the end-use of the items is for storage or holding of samples or slides.

The product catalogue of the manufacturer and certifications from the National Aids Research Institute and the National Institute of Virology, Pune, further confirmed that the items are used for storage of liquid samples or tissue culture and are consumable products used in laboratories, not instruments.

Issue 2: Demand for Duty and Imposition of Penalty
Given the classification issue, the demand for duty of Rs. 18,30,785/- and the imposition of penalty under Section 11AC were also in question. The Tribunal found that the products do not fall under CET 9027.00 and thus, the demand based on this classification cannot be sustained. Consequently, the duty demand and penalty were set aside.

Conclusion:
The appeal was allowed, setting aside the duty demand and penalty. The Tribunal clarified that the goods do not fall under CET 9027.00 but did not accept the contention that they fall under CET 9018.00, as they are neither instruments nor appliances used in medical, surgical, dental, or veterinary sciences but appear to be articles of plastics used in laboratories.

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