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of <h1>Tribunal Upholds Classification of Cotton Products, Exempts from Duty</h1> The Tribunal upheld the classification of 'Absorbent Cotton Wool' and 'Cotton Carded' under specific tariff headings, finding them exempt from duty under ... Classification of goods - Absorbent Cotton Wool IP - Cotton Rolls - whether classified under Chapter sub-heading 56012110 or otherwise? - Benefit of N/N. 30/2004-CE - Held that:- An identical issue has come up for consideration before the Tribunal in the case of M/s Shanti Surgical Pvt. Ltd. & Ors. vs CCE, Kanpur & Anr. [2017 (7) TMI 50 - CESTAT ALLAHABAD], where it was held that the impugned goods would fall under Chapter Sub-heading No.5601, 5203 & Chapter 58 - appeal dismissed - decided against Revenue. Issues Involved:1. Classification of the products manufactured by the assessee.2. Applicability of Notification No. 30/2004-CE.3. Determination of duty liability and penalties.Issue-wise Detailed Analysis:1. Classification of the Products:The core issue was the classification of 'Absorbent Cotton Wool IP,' 'Cotton Rolls,' and other related products. The Department argued for classification under Chapter 3005, while the assessee contended for Chapter sub-heading 5601, 5203, and Chapter 58. The Tribunal referenced a similar case, M/s Shanti Surgical Pvt. Ltd. vs CCE, Kanpur & Anr., which held that specific entries in the tariff should prevail over general entries. The Tribunal noted that 'Absorbent Cotton Wool' and 'Cotton Carded' specifically fall under Chapter sub-heading 56012110 and 52030000 respectively, without any exclusion based on their use or packaging. The Tribunal emphasized that classification should be determined according to the terms of the headings and any relative Section or Chapter Notes, as per Rule 1 of the Rules for Interpretation.2. Applicability of Notification No. 30/2004-CE:The adjudicating authorities had dropped the demands on the ground that Notification No. 30/2004-CE was not applicable, as the goods were covered under Chapter sub-heading 56012110. The Tribunal upheld this view, stating that the specific entries for 'Absorbent Cotton Wool' under Chapter sub-heading 56012110 and 'Cotton Carded' under 52030000 were applicable, which continued to remain exempt by virtue of conditions contained in Notification No. 30/2004.3. Determination of Duty Liability and Penalties:The Department issued a show cause notice demanding duty and penalties, alleging that the assessee was clearing goods without payment of duty. However, both the adjudicating authorities and the Tribunal found that the goods were correctly classified under the specific tariff headings and were exempt from duty as per Notification No. 30/2004-CE. The Tribunal referenced the principles laid down in earlier judgments, emphasizing that a specific entry should prevail over a general entry and that classification should be based on the nomenclature and constituent material of the goods.Conclusion:The Tribunal found no reason to interfere with the impugned order, which sustained the classification under Chapter sub-heading 56012110 and 52030000 and the applicability of Notification No. 30/2004-CE. Consequently, the appeal filed by the Department was dismissed.
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