TaxTMI 
TaxTMI 
Classification of Pesticides for the purpose of levy of excise duty and countervailing duty - Reg.
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng charted @ 18% whereas in other places, such bulk pesticide chemicals are classified under heading No. 38.08 of the Central Excise Tariff. 2. Technical grades of insecticides, pesticides etc. manufactured by them contains active ingredient in a highly concentrated and toxic form and these cannot be used as such by the ultimate customer. These manufacturers clear the said technical grade chemicals in bulk (generally in drums of 200-250 Kgs) to formulators. The formulators, in turn, prepare formulations by adding items such as inert carriers, solvents, surface active agents deodorants, masking agents, attractants. Such formulations can be used by the ultimate user and are therefore, packed in packages for retail sale. Chemically the techn....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n July, 1996. the tariff description of heading No. 38.08 was amended to cover only insecticides put up in forms or packings for retail sale. There was, however, no change in chapter Note 1(a) (2). As a result, pesticides in bulk form were excluded from heading No. 38.08. Bulk pesticides, if these were separately defined elements or compounds, got covered under chapter-28 or 29 depending on the composition. If these were not separately defined, the bulk pesticides would have fallen under heading No. 38.23. In either case, the rate of excise duty would have been 20% in 1996 Budget, and reduced to 18% in the 1997 Budget. 5. It is clear that the Technical grade pesticides, insecticides etc. are neither cleared in form or packing foe retail s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e exception of the following:- (2) Insecticides .........put up as described in heading No. 38.08" Consequently, all separate chemically defined pesticides, other than retail packings, will fall outside the scope of chapter 38, and will be assessed on merits under chapter 28 & 29 which are the relevant chapters for chemicals. The excise duty will be 18% and not 8% which is applicable only to pesticides put up in forms or packing for retail sale. 7. To sum up, after the 1996 Budget, pesticides in bulk form will not fall under heading No. 38.08. These will fall either under chapters applicable to chemicals in general or under heading No. 38.23, depending on whether these are separately defined elements or compounds or not. Changes made ....