Classification of Coconut Oil packed in small containers

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....lassification of 'coconut oil' packed in small containers and levy of excise duty, to issue the following instructions. Same issue was examined in the year 1995 but subsequently the Central Excise Tariff was amended w.e.f. 28.2.2005 and therefore, the issue has been re-examined. 2. There are two contenting classification. Chapter 15 covers various types of vegetable oil including coconut oil and Chapter 33 covers cosmetics including hair oil.   3. The disputes have arisen in respect of coconut oil when it is sold in small packs say of 50 ml. or 100 ml. When the Coconut oil is sold in small containers, following indications have been found on containers or labels. A. 'hair oil' B. 'edible oil' C. 'pure coconut oil' o....

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....l was specifically prepared for use on the hair (or) any label/literature/indications on the containers to the effect, the subject goods cannot be classified under 3305.90 simply because they were packed in small containers and applied by some sections of the society on the hair and it would be classified under chapter 15 as coconut oil. The said Chapter Note 2 to Chapter 33 has been modified alongwith addition of a new Section Note 2 to Section VI w.e.f. 28.2.2005. The amendments were carried out while aligning the Central Excise Tariff with internationally accepted Harmonized System of Nomenclature (HSN). In view of these amendments, the clarification issued in 1995 requires modifications for classification of coconut oil packed in sma....

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....ed in the said  heading and in no other heading of the schedule. This Section Note further supports the interpretation that though a product is capable of being classified under more than one heading, even then because of the nature of its retail packing, which is indicative of its use as  hair oil, the classification under heading 3305 would get priority. The illustration given in the HSN also supports this view. HSN Explanatory Notes to Section 2 of Section VI provides that sulphur put up for retail sale for therapeutic purpose is classified under heading 3004 and not in heading 2503 or 2802. Therefore, by the same logic, if coconut oil is packed in retail packs of say 10 ml. pouch or 50 ml bottles, which are generally used by c....