Denatured alcohol in deodorants affected tariff treatment, with non-potable industrial use keeping the duty classification intact.

Deodorants containing denatured alcohol were treated as falling outside the claimed Chapter 33 exclusion because the product's ingredients showed non-potable alcohol intended for industrial use. Chapter Note 33(1)(d) and Section 2 of the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 were applied to distinguish perfumery and toilet preparations containing alcohol by reference to the statutory meaning of alcohol. The presence of denatured alcohol indicated that the goods were not fit for human consumption, so the duty treatment applicable to alcoholic preparations not potable in nature was maintained and the classification in the impugned order was upheld.

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Issues: Whether deodorants containing denatured alcohol were classifiable under Chapter 33 of the Central Excise Tariff Act, 1985 so as to avoid countervailing duty, or whether they fell within the tariff treatment applicable to alcoholic preparations not fit for human consumption.

Analysis: The goods were examined on the basis of their ingredients, which showed denatured alcohol. Chapter Note 33(1)(d) of Chapter 33, read with Section 2 of the Medicinal and Toilet Preparations (Excise Duties) Act, 1955, was relied upon for the proposition that perfumery, cosmetics and toilet preparations containing alcohol are treated with reference to the statutory meaning of alcohol. The presence of denatured alcohol indicated that the product was not potable and was meant for industrial use. The reasoning was reinforced by the principle that duty consequences differ between potable liquor fit for human consumption and non-potable spirit used for industrial purposes.

Conclusion: The deodorant containing denatured alcohol was not entitled to the claimed exclusion from duty and the classification adopted in the impugned order was upheld.

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