TaxTMI 
TaxTMI 
1999 (5) TMI 33
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....IP - 51% w/w Talc Purified IP to - 100% w/w 3.The petitioner has challenged a Circular No. 356/72/97-CX, dated 20th November, 1997 and an order dated 5th November, 1997 under Section 37B of the Central Excises and Salt Act, 1944. By these orders, the respondents have classified Nycil Prickly Heat powder for purposes of levy of excise duty under the Heading 33.04 which covers "body or make-up preparations and preparations for the care of the skin (other than Medicaments) including sunscreen or suntan preparations, manicure or pedicure preparations." 4.According to the petitioner prior to the impugned orders, its product Nycil was considered as falling under Chapter 30 and was classified under Heading 30.03/sub-heading 3003.10 which includes patent or proprietary medicines. It is further pointed out that the matter of correct classification of prickly heat powders was referred by the Central Board of Excise and Customs to the Customs Co-operation Council at Brussels for its opinion. The Council referred the matter to the Harmonised Systems Committee (for short HSC) which considered the matter in its tenth session and opined as under : "The Committee unanimously agreed with th....
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....h the background note, is enclosed for necessary action. The classification of all Prickly Heat Powders may, therefore, be decided taking into account the above." 7.The Central Board of Excise and Customs again reiterated the position vide its order dated 3rd August, 1995 under Section 37B of the Act. It confirmed that Nycil powder would continue to be classified under Chapter 30 of the Tariff under Heading 30.03. 8.The opinion of the Harmonised Systems Committee was also accepted by the Central Excise and Gold (Control) Appellate Tribunal (for short CEGAT) in Collector of Central Excise v. Muller & Phipps (India) Limited with respect to Johnson's prickly heat powder. It will be recalled that the HSC had recommended Johnson prickly heat powder to be classified under Heading 33.04. The Tribunal noted the importance and persuasive force of the opinion of the HSC. It was observed: that the Central Excise Tariff is now based on HSN. The Harmonised System Committee is the high powered body to ascertain International practice of classification of a particular product referred to it recommends to the member nations the most appropriate classification of the product under HSN. The opinio....
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....se, Nagpur - 1996 (83) E.L.T. 492. In the context of the present case he submitted that no buyer or consumer buys Nycil prickly heat powder for use as a daily-use talcum powder. It is commonly understood as a powder meant to be used for treatment of prickly heat or other skin ailments. Our attention was also drawn to a judgment of the Calcutta High Court in Union of India v. G.D. Pharmaceuticals Limited - 1998 (100) E.L.T. 24 wherein the observation of the Supreme Court regarding popular meaning attached to a product being considered was relied upon. The product under consideration before the Calcutta High Court was 'Boroline' cream. The question arose as to whether Boroline containing Boric Acid with Zinc Oxide is a medicine or a cosmetic preparation. The point for consideration was almost similar as in the present case where it is for consideration as to whether Nycil prickly heat powder is a medical preparation or a cosmetic. With reference to Boroline it was observed that the product in question contains Boric acid with Zinc Oxide which cannot possibly be termed to be a cosmetic. Nycil prickly heat powder contains Chlorphenesin, a product specifically meant for treatment of ski....
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....ng the Central Excise Tariff Act, 1985, must be preferred, in case of any difference between the meaning of the expression given in the HSN and the meaning of that term given in the glossary of terms of the ISI." 13.The above observations were reiterated by the Supreme Court in C.C.E. v. Bakelite Hylam Limited - 1997 (91) E.L.T. 13 observing : "Hence for the interpretation of the New Tariff harmonised system of nomenclature and its explanatory notes are relevant. In the case of Collector of Central Excise, Shillong v. Wood Crafts Products Limited - 1995 (77) E.L.T. 23 (SC) = [1995 (3) SCC 454, this court, while considering the Central Excise Tariff Act, 1985, has held that looking to the statement of objects and reasons, the Central Excise Tariff under the 1985 Act is based on the Harmonised System of Nomenclature (HSN) and the internationally accepted nomenclature has been adopted to reduce disputes on account of tariff classification. Accordingly, for resolving any dispute relating to tariff classification, the internationally accepted nomenclature emerging from the HSN is a safe guide, this being the expressly acknowledged basis of the structure of the Central Excise Tariff in....
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....y the Supreme Court. Boroline cream was held to be a medical preparation not classifiable as a cosmetic. Another example of similar nature could be the specialised dental creams which are available for treatment of gum ailments. The use of these specialised dental creams is for specific purpose and for limited period. Rather the dentists advise that such medicated dental creams should not be used for long because they may desensitise the gums. The product in question contains a particular medicine namely, Chlorphenesin IP. The inclusion of this medicine in the composition makes all the difference as found by the HSC. It was because of use of this medicine in Nycil prickly heat powder that the HSC classified it differently as compared to Johnson Prickly heat powder and Shower to Shower powder. 18.We also find force in the submission made on behalf of the petitioner that the opinion of the Harmonsied Systems Committee has lot of weight and should ordinarily be taken as binding. As its very name suggests, the Committee is meant to harmonies the conflicting interpretations of products and their formulae in the member countries in view of international trade. In the present case it has....