AI Drafter 
TaxTMI 
TaxTMI 
2017 (7) TMI 289
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....ntral Excise Tariff Act, 1985. 2. Pursuant to certain investigations conducted by the department, the respondents were issued with nine show cause notices proposing to classify Chelamin, Agromin, Chelafer & Chelacop, cleared by them during the period from May 1998 to March 2005 as Plant Growth Regulators under CSH 3808 20 and thereby proposing to demand duty, interest and to impose penalty under various provisions of Central Excise Act, 1944 and the Rules made thereunder. In adjudication vide common Order-in-Original No. 25/2005 dated 30.11.2005, the Commissioner dropped the proposals contained in all the show cause notices by confirming the classification of the impugned goods namely Chelamin, Agromin, Chelafer and Chelacop as Other Fer....
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....erred circular the classification of the micronutrients has to be considered in terms of note 6 to Chapter 31. In view of the facts as discussed in the preceding paragraphs, it is quite apparent that the impugned goods failed to meet the requirements of the note 6 to Chapter 31 and hence do not qualify for classification under heading 3105 as other fertilisers. Therefore, the Commissioner ought to have considered the classification of the impugned goods under the alternative heading 38.08 on the basis of principles of classification as settled by the Hon'ble Apex Court in several cases and HSN note to that heading. (ii) Scope of the terms Plant-Growth Regulator is nowhere defined in the Central Excise Tariff. Therefore, from the plai....
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....r 31 of the CETA. (c) Note 1 to Chapter 38 states that a plant growth regulator classifiable under Chapter Note 38.08 should be a separately defined chemical element or compound. Products in question are mixtures simplicitor and, therefore, cannot be considered as chemically defined compounds or elements. The said facts are admitted in the entire proceedings, right from the Show Cause Notices to the Orders-in-Original to the present Departmental Appeal. Once it is established that the products in question are not chemically defined compounds then the test laid down in Chapter Note 1 (a) for classifying the product as Plant Growth Regulator is not satisfied. (d) Once the products are not classifiable under Chapter Heading 38 08, the de....
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....1 part (A) of the Fertiliser (Control) Order, 1985 and their mixture (with or without N, P, K) as notified by the Central Government or a State Government would be appropriately classifiable under Heading No. 31.05 as Other Fertilizers. 8.2 Subsequent to the Supreme Court judgment in the case of Ranadey Micronutrients [1996(87) E.L.T 19 (SC)], Board re-examined the matter and issued another circular No.392/25/98-CX, dated 19.05.1998. Referring to the HSN Explanatory Notes, Board advised therein as follows: "Fertilisers are materials added to soil and, sometimes to foliage to supply nutrients to sustain plants and promote their abundant and fruitful growth. The elements that constitute these plant foods are divided into three classes (....
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....t so as to accelerate growth yield and improve quality and hence the products are classifiable as plant growth regulators under chapter 38.08 only. We find that the same arguments have been put forth by the department in the grounds of appeal. 8.4 For better understanding of various contending classifications, the CETA heading Nos. 38.08 and 3105 are reproduced below: CETH 38.08 "Insecticides, rodenticides, fungicides, herbicides, anti-sprouting products and plant growth regulators, disinfectants and similar products put up in form or packings for retail sale or as preparations on articles (for example, sulphur-treated bands, wicks and candles and fly-papers). CETH 31.05 Mineral or chemical fertilisers, containing two or thre....
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....ral Excise. On the basis of opinion obtained from Indian Agricultural Research Institute (IARI), Central Excise Tariff explanatory notes, nature, usage etc., the CBEC has clarified, inter-alia, that micronutrients are essential nutrients and required in small quantities for the normal growth and development of plants containing elements like iron, Manganese, Zinc, Copper, Boron, Molybdenum, Nickel etc. Board has also acknowledged that these micronutrients are sold in the market as micronutrient fertiliser. It has, however, clarified that for classification under chapter 31, atleast one of the elements viz; Nitrogen, phosphorous or potassium should be an essential constituent of the fertiliser. Board has also clearly differentiated plant gro....