AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2000 (12) TMI 127
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.... The show cause notices were issued on account of the fact that the assessee in their classification lists declaration filed under Rule 173B of the Central Excise Rules, 1944 had been declaring the 'denatured salt' as one of the manufactured items and had claimed the classification thereof under chapter Heading 25.01. 3.On examination of the manufacturing process, it was noticed that the respondents have been purchasing raw materials namely Urea, Caustic Soda, Chlorine Gas etc. Caustic Soda and Chlorine gas are first reacted in a closed tank and the product so formed is transferred to another tank in which urea is already placed. Mixture in this tank is heated up to the temperature of 1000C. Heating is done with steam. The chemical react....
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....; that it was a mixture of Sodium Chloride and other Salts formed during chemical reaction in the plant in a natural way without applying any process for denaturalisation of the salt ; that this Residue also contains some quantities of Urea and Caustic Soda, which were initially put in the chemical reaction. He submitted, therefore, these goods were a mixture of chemical compound and were nothing but a Residue of chemical and allied industries. 5.The ld. JDR submitted that page 184 of H.S.N. entries covered only salt which has been denatured by any process, Residuary Sodium Chloride in particular that left after chemical processing (e.g. electrolysis) or obtained as a bye-product of the treatment of certain ores; that in chemical process....
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....rs only mineral products ; that note 2 to chapter 25 provides except where this context otherwise requires Heading 25.01, 25.03 25.05 covers only products which have been washed powdered or concentrated. Further the reasoning that the question of understanding a product by applying the principle of pre-dominance does not arise in this case as the product is clearly identifiable. The ld. DR also submitted that respondents herein have claimed classification of this product under chapter Heading 25.01 that chapter 25 covers only mineral products that note 1 to chapter 25 provides that this chapter covers in general, mineral products only; only mineral products which are in crude state or the products which have been crushed, ground, screened, ....
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....r than of mineral origin is also covered under chapter Heading No. 25.01. He submits that reaction in the instant case is wholly chemical reaction, and the Residue is obtained from bottom of centrifuge; that this is a process of separation of crystallised material from other material formed during separation of manufactured Hydrazine through crystallisation and is specifically excluded by chapter note 2 to chapter 25 of CETA 1985. Ld. Counsel submitted that the maxim that the context otherwise requires read with chapter note 1 & 2 of H.S.N. as well as chapter note 2 appended to chapter 25 of the CETA 1985 do not limit that salt is to be obtained from mineral, ores, or Sea water only. Ld. Counsel also submitted that titles of Sections and th....
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....none of these chemicals are classifiable under chapter 25, thus the Residue in question cannot be a product obtained after chemical processing e.g. (electrolysis). None is a bye-product of a treatment of certain ores. The product is obtained after crystallisation. The product is obtained as a bye-product or Residue while manufacturing Hydrazine. Hydrazine is admitedly a chemical. Thus the Residue in the instant case is nothing but a residue of chemical and allied industries. We note that there is specific heading for Residue of chemical and allied industries under the present chapter Heading 38.24. Since there is specific heading, we need not go to decide the issue by resorting to be Rules for interpretation of tariff. These Rules are attra....