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of <h1>Tribunal overturns order, rules 'Hot Molten Mixture of Petroleum Jelly' not classified as such.</h1> The Tribunal set aside the impugned order and allowed the appeal on merits, emphasizing the lack of conclusive evidence to classify the 'Hot Molten ... Petroleum jelly - Marketability Issues:1. Excisability and dutiability of 'Hot Molten Mixture of Petroleum Jelly' during the manufacturing process of antiseptic Boroline Cream.2. Classification of the mixture under the Central Excise Tariff.3. Marketability of the mixture in its hot molten stage.4. Compliance with the criteria for considering a product as petroleum jelly.5. Interpretation of Chemical Examiner reports and H.S.N. Explanatory Note.Analysis:1. Excisability and Dutiability:The dispute revolves around the excisability and dutiability of the 'Hot Molten Mixture of Petroleum Jelly' emerging during the manufacturing process of antiseptic Boroline Cream. The Department classified the mixture as petroleum jelly under sub-heading 2712.10 of the Central Excise Tariff, leading to a demand of duty and imposition of a penalty. The appellants contested this classification, arguing that the mixture is a new product comprising Mineral Hydro Carbons and Lanolin, distinct from petroleum jelly. They relied on a Chemical Examiner report stating the product did not meet the criteria for petroleum jelly classification.2. Classification under Central Excise Tariff:The Revenue maintained that the mixture, predominantly jelly with a small amount of lanolin, should be classified as petroleum jelly. They argued that the product's marketability was evidenced by its stability over time and its use as a cream base. The Commissioner contended that the mixture was commercially known as 'Cream Base' and was marketable, falling under a separate Tariff Heading of Chapter 27. The Revenue distinguished this case from a previous judgment, emphasizing the satisfaction of characteristics of petroleum jelly in the Chemical Examiner's second report.3. Marketability of Hot Molten Mixture:The key point of contention was the marketability of the hot molten mixture in its initial stage. The appellants asserted that the mixture was not marketable at this stage and could not be considered a distinct commodity in the market. They highlighted the transient shelf-life and argued that the product's marketability was unproven. The Commissioner, however, claimed that the mixture was commercially recognized and could be marketed, especially if allowed to cool.4. Compliance with Petroleum Jelly Criteria:The H.S.N. Explanatory Note outlined specific criteria for a product to be classified as petroleum jelly. The Chemical Examiner's report confirmed the congealing point and density of the mixture, aligning with petroleum jelly standards. However, the absence of a cone penetration test and ambiguity regarding the congealing point determination method raised doubts about the mixture's classification as petroleum jelly.5. Interpretation of Reports and Precedent:The Tribunal analyzed the Chemical Examiner reports, emphasizing the need for conclusive evidence to classify the mixture as petroleum jelly. Referring to a previous judgment, the Tribunal held that the Revenue failed to prove the marketability of the intermediate product, similar to the present case. Consequently, the impugned order was set aside, and the appeal was allowed on merits without addressing the limitation aspect.In conclusion, the judgment focused on the excisability, dutiability, classification, and marketability of the 'Hot Molten Mixture of Petroleum Jelly,' emphasizing the need for conclusive evidence, compliance with criteria, and precedent-based decision-making in resolving the dispute.
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