TaxTMI 
TaxTMI 
2012 (10) TMI 301
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....names, such as, Red Label, Taj Mahal, Taaza etc. According to the petitioners, tea fortified with vitamins is also tea and, therefore, falls under Chapter 9 of the Customs Tariff Act, 1975. 4. Tea, whether or not flavoured, is classified under Chapter 9 of the First Schedule of the Central Excise Tariff Act, 1985 and has been exempted from duty by Exemption Notification No. 3/2006. 5. The entries under Chapter 9 include Green Tea in bulk, as well as in packets, green tea agglomerated I forms such as balls, bricks or tablets, green tea waste, black tea fermented or not, whether in bulk or in packets, black tea leaf, black tea dust, tea bags, black tea agglomerated in different forms, such as, ball brick and tablet and other forms and/or varieties of black tea. 6. The impugned circular inter alia provides as follows : "2. Preparation of tea and preparation with the basis of tea are classifiable under the chapter heading 210120. Preparation of tea as well as preparation with a basis of tea is a product containing tea as one of the major component and has other added ingredients to it. Flavoured tea contains tea along with at least one flavouring agent and is a ....
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.... Commissioner (Appeals) cannot decide the question of legality of the Circular. Mr. Ganesh's argument that as subordinate authority, the Commissioner (Appeals) cannot be expected to take a view, which is different from the circular, cannot be ruled out. The matter would necessarily have to be decided by this Court. It is true that an appeal has been filed. Mr. Ganesh gave an undertaking to the Court to withdraw the appeal. 10. It is pleaded that for production of tea fortified with vitamins, the petitioner No. 1 merely sprays vitamins in liquid form on black tea, which is otherwise classifiable under Chapter 9. Mr. Ganesh, Senior Counsel appearing on behalf of the petitioners, submitted that the tea does not undergo any transformation as a result of the process of spraying vitamins in liquid form. No new or distinct product is produced. The product does not have any distinct name, characteristic or use. 11. In Union of India & Ors. v. Delhi Cloth and General Mills Co. Ltd. & Ors., reported in AIR 1963 SC 791 = 1977 (1) E.L.T. (J 199) (S.C.) cited by Mr. Ganesh, a five-Judge Bench of the Supreme Court held that the word "manufacture" is generally understood to mean bring....
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....ive a desired shape to the material. It is an activity performed on a given material in order to transform it into something. 16. Th word "manufacture" has been defined in various Judgments of this Court. In South Bihar Sugar Mills v. Union of India [AIR 1968 SC 922], this Court observed : "The Act charges duty on manufacture of goods. The word "manufacture" implies a change every change in the raw material is not manufacture. There must be such a transformation that a new and different article must emerge having a distinctive name, character or use." 13. In M/s. Ujagar Prints and Ors. (II) v. Union of India & Ors., reported in (1989) 3 SCC 488 = 1988 (38) E.L.T. 535 (S.C.) : the Supreme Court held that the test to ascertain that there was manufacture is whether the change or the series of changes brought about by the application of processes took the commodity to a point where commercially it could no longer be registered as the original commodity, but was, instead, recognized as a distinct and new article that had emerged as a result of the processes. 14. Mr. Ganesh also cited another judgment of the Division Bench of the High Court of Delhi in Collector of Cen....
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....sed on tea, instant tea and quick brewing tea undergo a process of manufacture and emerge as a distinct item. Tea aroma is also not the same as tea. The residuary item 'others' has to be construed in the context of the specified items to mean items similar to those listed under Item Tariff No. 2101. Tea fortified with vitamins is not similar to any of the items enumerated under the said Item Tariff. 20. The specific exclusion of flavoured tea from Chapter 21 by insertion of Note 1(c) cannot and does not lead to the inference that vitaminized tea which has not expressly been excluded, would be included in Chapter 21, even though vitaminized tea is also tea. Flavoured tea may have expressly been excluded as tea is flavoured by adding extracts or concentrates of totally different items, such as, mint, lemon, strawberry and the like, and could, therefore, be construed as a different drink based on tea, but for the exclusion. In case of tea fortified with vitamins this was not considered necessary. 21. Mr. Ganesh referred to a decision of the CESTAT, South Zonal Bench, Bangalore in Sampre Nutritions Ltd. v. Commissioner of Central Excise, Hyderabad, reported in 2004 (169) E.....
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....nnot be permitted to take a different stand in the present appeals." 24. Mr. Ganesh rightly argued that there being no appeal, the decision of the CESTAT has assumed finality. The department is bound to apply the same to other assessees similarly circumstanced. The Department cannot be permitted to take a different stand in this case. 25. In M/s. Radhasoami Satsang, Saomi Bagh, Agra v. Commissioner of Income Tax, reported in (1992) 1 SCC 659, cited by Mr. Ganesh, the Supreme Court held that even though res judicata did not strictly apply to assessment for different years, finding of facts on any fundamental aspects, which were common in previous years pertaining to the assessee, and which remained unchallenged, could not be allowed to be disturbed in subsequent years. 26. In J.K. Synthetics Ltd. & Anr. v. Union of India & Ors., reported in 1981 (8) E.L.T. 328 (Del.), cited by Mr. Ganesh, the High Court of Delhi held that an order passed by a Court of Law or revisionary authority is final and conclusive qua the parties. It is not open to the Central Excise Authorities to change their stand capriciously and put the assessee to inconvenience and harassment, if the po....