TaxTMI 
TaxTMI 
2011 (3) TMI 64
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....onsisting of mixing dry fruit. The product is marketed in the brand name of Everest Milk Masala . The ingredients of the product are specified as under:- Nuts Percentage Other Spices Percentage Almonds 42.36% Cardamom 9.00% Cashewnuts 24.05% Mace 6.36% Pista 16.95% Saffron 0.064% Nut Meg 0.064% 3. The appellants classified the said product under chapter heading 21.06 as food mixing and sought exemption for payment of duty under sr.no. 30A of notification 3/07 CE dated 1.3.2007. A show cause notice was issued. In response to the show cause notice, the appellant contended that the product is a mixture of dry fruit and classifiable under chapter heading 2008 1900 and is fully exempt under sr.no. 22 of the notification 3/2006-CE. After hearing the contention of the appellant the adjudicating authority classified the product under heading 2106 9060 as food flavouring material relying on the opinion of Prof. Lele. Therefore by the said classification the appellants are in appeal before us. 4. Therefore, the matter involves the following issue :- 1. Whether the product consisting ....
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....fic entry, they are to be classified under that entry. In the present case, the product is specifically covered under Chapter Heading 20.08 by description and is correctly classifiable under Chapter Heading 20.08. F. In any event, the above product is not classifiable under Chapter 21.06. The explanatory note to HSN specifically provides that the goods which are not covered by any other heading of the nomenclature are covered under heading 21.06. Heading 21.06 is residuary heading. G. It is settled position in law that the specific entry takes precedence over the residuary entry. H. Reliance on the Supplementary Note 5(b) to Chapter 21 of the Central Excise Tariff has no application in the facts of the present case. Notwithstanding similar note in the explanatory notes in Heading 21.06, the mixture of dry fruits whether or not containing or coated with vegetable oil, salt, flavours, spices or other additives are covered under Chapter Heading 20.08. I. It is submitted that the effect of note 5(b) is the same as given in the explanatory notes. It is now well settled that explanatory notes to HSN is to be applied in interpreting the Central Exci....
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....ld be ignored (ii) Collector of C.Ex. Madras V/s. Sundaram Fastners Ltd., Madras reported in 1985 (22) ELT 923, the Hon ble Appellate Tribunal inter alia, held that common parlance test principles means that the goods for classification should be covered by, and not that they should be known in, the wordings of tariff description. P. Assuming without admitting that the product is covered by Chapter Heading 21.06, it is submitted that the product is to be treated as food mix. The Heading covers Food Preparation . It is admitted in the impugned order that the product can be consumed as such. What can be consumed as such is to be regarded as food. In view thereof, the product is exempt under Serial No. 30A of Notification No. 3/2006 dated 1st March, 2006 as amended by Notification No. 3/2007-CE dated 1st March, 2007. Q. The claim of the revenue that the product is food flavouring material is completely without any basis. No such claim was set up in the earlier proceedings. R. The case of the revenue that the product is food flavouring material is based on the opinion of Prof. Lele. Prof. Lele was not permitted to be cross-examined despite specif....
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....l, hence the adjudicating authority has passed the impugned order within the purview of law. Hence same is to be sustained. He further submitted that w.e.f. 28.2.2005, the Central Excise Tariff has been aligned with the 8 digit Customs Tariff. However, the scope of Chapter 21 has not been changed. Due to alignment, goods covered by earlier heading 21.07 of the Central Excise Tariff are now covered under heading 21.06 of the Tariff ibid. The earlier Chapter heading Note 5(b) to Chapter 21 (before alignment) is also existing in the present chapter 21 in the form Sub heading Note 5(b). Therefore, the aforesaid decision of the Hon ble Tribunal, which was based on Chapter note 5(b) is applicable under post aligned Central Excise Tariff. Further at the time alignment it was clarified by the CBEC vide circular no. 808/5/2005/CX dated 25.5.2005 that exercise is to align the Central Excise Tariff with Customs Tariff and it was not meant for changing the rates of duty, and suitable amendments were made in the notifications where there was change in duty. The only change is at the subheading level. In new Tariff separate tariff heading at 8 digit level (21 06 90 60) has been created for Food ....
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....edible in nature and when the products are actually classifiable under Chapter 20, there is no question of going to the heading in Chapter 21, which is residuary in nature. In the case of Kulkarni Black & Deckers Ltd. (supra) the Hon ble Bombay High Court has held that it is not permissible to take into consideration the trade meaning or commercial nomenclature when the definition provided in the statute is extremely clear and does not suffer any ambiguity. In case where the application of commercial meaning or trade nomenclature runs counter to the statutory context in which the word is used in the tariff item then the trade meaning or commercial nomenclature should be ignored. 9.4 As per Rule 3(a) of the General Rules for the Interpretation of Central Excise Tariff the heading which provides the most specific description shall be preferred to headings providing a more general description. 9.5 We have also seen that the appellants have contended that they were denied the cross examination of Prof. Lele on whose report the adjudicating order has been passed is in violation of principles of natural justice. As Prof. Lele held in his report is based on market surv....