TaxTMI 
TaxTMI 
TaxTMI 
2024 (8) TMI 1668
X X X X Extracts X X X X
X X X X Extracts X X X X
....& Espresso varieties), Juizy Milk (Mango and Strawberry), Tamarin; (ii) Chocolate confectionery sold under the brand name of Choki-Choki; and (iii) noodles under the brand name of JoyMee noodles, all edible items. 1.3. The product in question, namely Kopiko, a hard boiled sugar and glucose confectionery, is being manufactured by the Hyderabad plant since September-2012 and Gujarat plant from November-2014. The Product Kopiko contains 1.57% flavour Coffee. 1.4. The officers of the Zonal units of the Directorate General of Central Excise intelligence, located at Hyderabad and Ahmedabad commenced investigations into classification of `Kopikoʼ with summons vide F. No. INV/DGEI/HZU/CE/08/2015-CE dated 27.03.20153. The investigations culminated in the issuance of following two Show Cause Notices :- (a) SCA NO. 23/2015 dated 03.07.2015, vide F. No. INV/DGEI/HZU/CE/08/2015, to the appellant at Ranga Reddy Plant, Hyderabad; (b) F. No. DGCEI/AZU/36-64/2015-2016 dated 08.12.2015 to the Appellant at Ahmedabad plant. 1.5. This is the subject matter of the present appeal. In the Show Cause Notice it was also alleged that "Kopiko (cappuccino and espresso varieties)....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oning that the Coffee Flavour forms the basis for manufacture of Kopiko. 2.3. It is submitted that on reading of the said sub-heading 2101 1200, it is evident that the preparations should be made with a basis of coffee, extracts of coffee, etc. The product Kopiko does contain the Coffee flavour by weight 1.57%, as submitted above. Further, there are other items like ethyl vanillin and flavour Milk whose function is to add flavour. Also, Butter, Salt, and Kernel are added for taste. Thus it is imperative for examining the meaning of the term 'BASIS', that determines the interpretation of the preparations covered by sub-heading 2101 1200. 2.4. He submits that as per the composition of the product Admittedly, the coffee essence which is used as a flavoring agent is not the basis/ underlying/ predominant material in the product which is predominantly sugar confectionery even as will be evident from the facts. There is a distinction between "preparations containing coffee" and "preparations on the basis of extracts /essences/concentrates or basis of coffee". 2.5. In this regard he gives an example of Chapter Heading 1806 which deals with Chocolates & other Food preparat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....k quantity, weight or value. 2.9. On both the above counts it is sugar/glucose is the predominant input and therefore as per the principles of classification in the GIR, the product merits classification under CETH 1704. 2.10. He further submits that a small amount of other ingredients or marketing technique cannot alter the classification. In this regard he placed reliance on the following Judgments : ● Sampre Nutritions Ltd. Vs. CCE 2004 (169) E.L.T. 42 (Tri .- Bang.) ● Satnam Overseas Ltd. Vs. CCE, New Delhi 2015 (318) E.L.T. 538 (S.C) ● Hindustan Unilever Ltd. Vs. Central Board of Excise & Customs 2012 (283) E.L.T. 26 (Cal.) ● Blue Star Ltd. Vs. UOI 1980 (6) E.L.T. 280 ● Hindustan Lever Ltd. Vs. CCE 2000 (121) ELT 451 ● Commissioner Vs. Hindustan Lever Ltd .- 2002 (146) ELT A214 ● Atul Glass Industries (P) Ltd. Vs. CCE 1986 (25) ELT 473 (SC) 2.11. He further submit that the product classified as sugar confectionary under FSSAI Act also. 2.12. He also placed reliance on the Tribunal's judgment in the case of Collector of C. Ex., Chandigarh Vs. Sukhjit Starch &....
X X X X Extracts X X X X
X X X X Extracts X X X X
.....57 For Flavour Total Qty. for 1 batch 500.013 100.00 From the above it is clear that the product contains flavour coffee to the extent of 1.57 % whereas the majority ingredients are refined sugar 33.06%, liquid glucose 41.41%, other ingredients constitute to 11.81% and water at the rate of 12.5%. The Adjudicating Authority confirmed classification under 2101 1200 on the basis that the product Kopiko contains flavor coffee has the product meets with the description given in 2101 1200. For the reference both the rival entries are reproduced below :- Tariff Heading Description of goods Unit Rate 1704 Sugar Confectionary (including white chocolate), not containing cocoa. Tariff Item Description of goods Unit Rate 1704 90 Other 1704 90 90 Other Tariff Heading Description of goods Unit Rate 2101 Extracts, Essences And Concentrates of Coffee, Tea or Mate and Preparations with a basis of these products or with a basis of coffee, tea or mate; Roasted Chicory And other Roasted Coffee ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ll be effected as follows: (a) the heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods. (b) mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to (a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable. (c) when goods cannot be classified by reference to (a) or (b), they shall be classified under the heading which or curs last in numerical order among those which equally merit consideration." Ongoing through the above rules for the interpretation, we find that even as per the Rule 1 the classification shall be dete....