TaxTMI 
TaxTMI 
2018 (11) TMI 152
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.... Bhiwandi, District - Thane (Maharashtra) and clearing the same without payment of duty. Accordingly, a show cause notice was issued demanding duty and penalties, but both the adjudicating authorities below dropped the demands on the ground that the goods are covered under Chapter sub-heading 56012110 and thus Notification No. 30/2004-CE is not applicable. Being aggrieved, the Department filed the present appeal. 3. With this background, we have heard Sh. R.K. Mishra, learned DR for the Revenue and Ms. Rinki Arora, learned counsel for the assessee-Respondents. 4. After hearing both sides and on perusal of the material available on record, it appears that an identical issue has come up for consideration before the Tribunal in the case of M/s Shanti Surgical Pvt. Ltd. & Ors. vs CCE, Kanpur & Anr., 2017-TIOL-2153-CESTAT-ALL, wherein it was held that: "10. Having considered the rival contentions and on perusal of the facts on record, we find that the main issue in the present 6 appeals is the classification of the products mainly Absorbent Cotton Wool, Carded Cotton/Non-Absorbent Cotton, Handloom Gauze, Handloom Bandages & Bandages, etc. Revenue has claimed the classification ....
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....upon the Section notes, the Chapter note, the explanations of HSN and the case laws of various judicial forums. On the contrary, the appellants have pleaded that the goods in question were rightly classifiable under their respective sub-headings as claimed by them, on the basis of nomenclature. The basic submission of the appellants was that the specific entry cannot be overridden by the residuary entry. In support of their contention they have relied upon various judicial pronouncements of Hon'ble Apex Court and Hon'ble Tribunal, wherein it has been settled that the specific entry will prevail over the general. The next submission of the appellant was that their sales were not the 'retail sales' as the goods were not sold for retail consumption to ultimate consumers; rather their buyers were the industrial and institutional buyers. They have also submitted that their packages were not the 'retail packages'. The appellants in their defence have relied upon the definition of terms 'retail sale' and 'retail package' as defined in "The Standards of Weight and Measures (Packaged Commodities) Rules, 1977 (SWMPCR in short) issued under the Standards of Weight & Measures Act, 1976 (SWM....
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....cific entry where the goods can be classified as per the nomenclature and the constituent material. In case no specific entry is available the next attempt should be to find the nearest entry where the goods can be classified. In case both the attempts turn to be futile then the attempt should be made to consider the end uses, the inclusion and exclusion clauses provided in the section notes, the chapter notes and the explanatory notes given the HSN. While doing so the interpretation of the said Note will depend upon the context in which the entries have been worded. If an entry is clearly worded and is broad in character, the same would lead to the conclusion. An entry is to be given its ordinary meaning. If any goods fit in within one entry, the same for any purpose would not be held to be included in the other and in particular the residuary. Now coming to the issue, I observe that the goods "Absorbent Cotton Wool" and "Cotton Carded" specifically find place in the Chapter Sub-heading 56012110 & 52030000 respectively. Nothing regarding its uses, its packing, its end use or its being of 'IP' grade has been specified therein so as to exclude it from classification under said headi....
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....p; 5601 21 10 --Absorbent Cotton Wool Kg 8% 5601 21 90 ---Other Kg 8% 5601 22 00 --Of man made fibres Kg 16% 5601 29 00 --Other Kg 8% 5601 30 00 -Textile flock and dust and mill neps Kg 8% 5602 Felt, whether or not impregnated, coated, covered or laminated. It is well settled what is not excluded would be held to be included. In this regard, I would like to quote the provisions of Rule 1 of the Rules for the Interpretation which clearly provides that "1. The titles of Sections and chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require, according to the provisions hereinafter contained." In the aforesaid rule there is no ambiguity and it has clearly been held that the classification has to be determined according to the terms of headings and in case of any ambiguity the Rule 2, 3 or 4 as the case may be, shall be applied. Furthermore, the Rule 5 of aforesai....
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....s manufactured by the appellant satisfied the specific description of Tariff Heading 90.24 being a flow meter, the Tribunal committed an error of law in classifying it under Tariff Heading 90.26 as it was a letter item under the classification list." In the same order, in Para 4 the Hon'ble Bench while comparing various Chapter Headings has further noticed that "Flow meters are specifically covered in Tariff Heading 90.24. Specific excludes general, is the well-known principle. Heading 90.29 permits levy on parts or accessories which are used solely in the manufacture of one or more of the articles falling within Heading 90.24. The Assistant Collector held that the accessories imported by the appellant were used solely for the meter manufactured by the appellant. Therefore, if the meter manufactured by the appellant can be said to satisfy the description of Tariff Heading 90.24, then by virtue of Tariff Heading 90.29 the rate of duty on the components imported by the appellant could be levied as in Tariff Heading 90.24. On the finding recorded by the Assistant Collector the end-product manufactured by the appellant being specifically provided for by 90.24, the accessory imported....