Tariff classification of bicarbonate of soda upheld despite impurities and captive consumption under excise law.

Bicarbonate of soda remained classifiable and dutiable under Tariff Item 14AA before 1-3-1986 and under Heading 2805.30 thereafter because it was specifically named in the tariff and Chapter Note 2(a) treated chemically defined compounds as covered even with impurities. The prescribed I.S.I. purity standard was irrelevant to classification, and sub-standard purity did not remove the product from the tariff entry. Its use as an intermediate product for captive consumption also did not exclude excise duty, since excise attaches to manufacture and not to marketability where the goods answer the tariff description. The duty demand and penalty were therefore upheld.

---

---

Issues: Whether bicarbonate of soda captively consumed in the manufacture of soda ash and ammonium chloride was classifiable and dutiable under Tariff Item 14AA prior to 1-3-1986 and under Heading 2805.30 of the Central Excise Tariff Act, 1985 from 1-3-1986, notwithstanding its sub-standard purity and captive consumption.

Analysis: Bicarbonate of soda was specifically named in both the pre-1986 tariff item and the post-1986 heading. Chapter Note 2(a) of Chapter 28 made it clear that chemically defined compounds were covered even if they contained impurities. The prescribed I.S.I. purity standard was held to be irrelevant for tariff classification. The fact that the product emerged as an intermediate product and was not sold in the market did not exclude it from excise duty, since excise is a duty on manufacture and captive consumption does not prevent levy where the goods answer the tariff description. The cited authorities relied upon by the assessee were distinguished on their facts, while the decisions supporting levy on intermediate and captive-consumed products were followed.

Conclusion: The product was correctly held to be excisable under Tariff Item 14AA for the period prior to 1-3-1986 and under Heading 2805.30 thereafter, and the demand of duty and penalty under the relevant Central Excise Rules was upheld against the assessee.

---