TaxTMI 
TaxTMI 
2026 (10) TMI 469
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.... the appeals arise from a common set of issues concerning the eligibility of the subject goods to the benefit of the exemption notifications referred to hereinafter, the appeals were taken up together for hearing and are being disposed of by this common order, with the consent of the parties. 1.2. For ease of reference, the particulars of the present appeals, including the respective duty demands confirmed in the corresponding adjudication proceedings, have been tabulated below: - Sl. No. CESTAT Appeal No. OIO No. & Dt. Impugned OIA No. & Dt. Goods involved Notification No. & Date Period involved Duty involved (in Rs.) 1 E/75840/2026 16/JOINT COMM/CE/SL G/15-16 dated 08.01.2016 136142/SLGC.Ex./2017 dated 20.06.2017 Cheese Balls Notification No. 12/2012C.E. dated 17.03.2012 - Sl. No. 37 April 2012 to December 2012 21,46,515/- 2 E/75841/2026 17/JOINT COMM/CE/SL G/15-16 dated 08.01.2016 136142/SLGC.Ex./2017 dated 20.06.2017 Cheese Balls Notification No. 03/2006C.E. dated 01.03.2006 - Sl. No. 29; March 2011 to March 2012 5,81,392/- 3 E/75842/2026 19/JOINT COMM/CE/SL G/15-16 dated 14.01.2016 136142/SL....
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....ntly packed for sale in ready-to-consume form. Both Cheese Balls and Bhujia are sold under the appellant's brand name in sealed retail pouches of different quantities. 3. At this juncture, it is relevant to note that during certain periods relevant to the present appeals, the appellant had initially classified Cheese Balls under Tariff Item No. 1905 9030 of the First Schedule to the Central Excise Tariff Act, 1985. The appellant subsequently accepted the classification of Cheese Balls under Tariff Item No. 2106 9099, under which Bhujia was also classifiable, and the adjudicating authorities proceeded on that basis. Therefore, from the records available before us as well as the submissions made, it is observed that the classification of the subject goods under Tariff Item No. 2106 9099 is not in dispute in the present proceedings. The dispute herein is confined to the entitlement of the subject goods to exemption under the relevant notifications i.e., Notification No. 03/2006-C.E. dated 01.03.2006 and the succeeding Notification No. 12/2012-C.E. dated 17.03.2012, which are both applicable to the periods under dispute in the present cases. 4. For the period preceding 17.03.2012....
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....est and penalty under Section 11AC(1)(c) of the Central Excise Act, 1944 read with Rule 25(1) of the Central Excise Rules, 2002. 6.1. The appellant contested the proposals and submitted that the subject goods were squarely covered by the specific descriptions appearing in Sl. No. 29 of Notification No. 03/2006-C.E. dated 01.03.2006 and Sl. No. 37 of Notification No. 12/2012-C.E. dated 17.03.2012. It was further contended that the exemption prescribed under the said specific entries was unconditional and that a condition relating to the manner of clearance appearing in a separate entry could not be imported into the specific entries applicable to the goods in question. 7. The seven adjudication orders, particulars whereof have been set out under paragraph 1.2. hereinabove, thus covered the period from March 2011 to June 2015 and resulted in confirmation of an aggregate Central Excise duty demand of Rs. 1,14,65,663/-, together with applicable interest and penalties aggregating to an equivalent amount. The demands were confirmed under Section 11A of the Central Excise Act, 1944 (hereinafter referred to as the "said Act"), including the extended-period provisions thereof wherever....
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....ing, the same exemption notification and the same departmental objection founded upon clearance of the goods in sealed packages. This Tribunal held that Serial No. 38 of Notification No. 12/2012Central Excise dated March 17, 2012 had no application to goods sold in sealed packages and that the goods were entitled to the nil rate of duty under Serial No. 37 thereof. The demand and penalty were consequently set aside. (iv) The aforesaid decision directly governs the interpretation of Serial Nos. 37 and 38 in the present appeals. A coordinate Bench is required to follow an earlier decision on the same question unless the matter is referred to a larger Bench. Reliance in this regard is placed upon the decision of the Supreme Court in Union of India v. Paras Laminates Private Limited, 1990 (49) E.L.T. 322 (S.C.). (v) Excise Appeal Nos. 75844 and 75846 of 2026 concern Bhujia. Bhujia is expressly enumerated in Serial No. 37 of Notification No. 12/2012Central Excise dated March 17, 2012. These two appeals are, therefore, covered in their entirety by Final Order No. 76771 of 2024 dated August 22, 2024. (vi) The remaining appeals concern Cheese Balls. The show caus....
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...., 2019 (25) G.S.T.L. 545 (Tri.-Hyd.), the Tribunal recognised the width of the corresponding entry and held that a ready-to-consume edible preparation answering the general description was eligible for exemption notwithstanding that its particular commercial name was not separately enumerated. (ix) The departmental interpretation fails to appreciate the hierarchy of the Central Excise Tariff. Heading 2106 covers food preparations not elsewhere specified or included; subheading 2106 90 covers "other" goods within that heading; and tariff item 2106 90 99 is an eight-digit residual tariff item situated within sub-heading 2106 90. Tariff item 2106 90 99 and sub-heading 2106 90 are therefore not mutually exclusive classifications. Every product classifiable under tariff item 2106 90 99 necessarily falls within the broader sub-heading 2106 90. Supplementary Note 6 to Chapter 21 makes the position explicit by providing that tariff item 2106 90 99 includes sweetmeats commonly known as misthans or mithai and products commonly known as namkeen, mixture, Bhujia and chabena, or called by any other name, irrespective of the nature of their ingredients. The Tariff itself thus places nam....
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.... under Serial No. 37 is independent of the availability or otherwise of the exemption under Serial No. 38. The denial of exemption under one entry does not preclude an assessee from claiming the benefit under another entry whose requirements are satisfied (xv) Reliance is placed by the appellant on the following case-law: - * Gujarat State Fertilizers Company v. Collector of Central Excise, 1997 (91) E.L.T. 3 (S.C.), * Share Medical Care v. Union of India, 2007 (209) E.L.T. 321 (S.C.) (xvi). There was an overlap in the Notification No. 3/2006-Central Excise, which was recognised and resolved by the Central Board of Excise and Customs in Circular No. 841/18/2006-CX dated December 6, 2006. The Circular considered the position of ready-to-eat packaged namkeen and Bhujia falling under tariff item 2106 90 99 and expressly noted that such goods answered the descriptions appearing both in Serial No. 29 and in Serial No. 30 of Notification No. 3/2006Central Excise dated March 1, 2006. The Circular clarified that goods covered by the specific description in Serial No. 29 continued to enjoy the nil rate of duty even when they were also ready-to-eat package....
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.... in the appellant's own case. (xx) For the periods governed by Notification No. 3/2006-Central Excise dated March 1, 2006, the goods are entitled to the nil rate of duty under Serial No. 29. For the periods governed by Notification No. 12/2012-Central Excise dated March 17, 2012, the goods are entitled to the nil rate of duty under Serial No. 37. Their clearance in sealed retail packages does not alter that position. (xxi) The fundamental error in the adjudication orders and the said impugned order lies in treating goods classifiable under tariff item 2106 90 99 as though they stood outside the broader sub-heading 2106 90 and were governed exclusively by Serial No. 30 or Serial No. 38. Such an interpretation is contrary to the tariff hierarchy, Supplementary Note 6 to Chapter 21, the express description in Serial Nos. 29 and 37 and Circular No. 841/18/2006CX dated December 6, 2006. Once the subject goods answer the specific description of namkeen, Bhujia or similar edible preparations in ready-for-consumption form, their packaging is immaterial and the separate entries applicable to other residual food preparations cannot displace the specific nil-rate exemption. ....
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.... No. 29) and Notification No. 12/2012-C.E. dated 17.03.2012 (Sl. No. 37), as applicable to the respective periods. 11.1. The stand of the Department, however, has varied with the two notifications. In respect of the period governed by Notification No. 03/2006-C.E., the Revenue has considered Sl. No. 30, covering "ready to eat packaged food" at the applicable rate of duty, to be the appropriate entry, while denying the specific exemption under Sl. No. 29. 11.2. For the subsequent period governed by Notification No. 12/2012-C.E., the Department has denied the applicability of Sl. No. 37 to the subject goods and has also held that the alternative entry at Sl. No. 38, though more relevant to the impugned goods being classifiable under Tariff Item No. 2106 9099, could not be applied since the same pertained to food preparations "not cleared in sealed containers" whereas the goods were cleared in sealed retail pouches. "Bhujia" - Excise Appeal Nos. 75844 and 75846 of 2026 12. Insofar as Excise Appeal Nos. 75844 and 75846 of 2026 are concerned, the goods involved are "Bhujia", and the periods therein are covered by Notification No. 12/2012-C.E. dated 17.03.2012. Significantly,....
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....no penalty is imposable on the appellant. Therefore, appeal is allowed with consequential relief, if any." 12.2. The aforesaid decision, rendered in the appellant's own case on the same exemption entry and concerning the same commodity, bears direct relevance to the issue presently before us. In the absence of any distinguishing feature having been brought to our notice, we do not find any reason to differ from the view taken therein in respect of the above two appeals. The said issue is, therefore, no more res integra. 12.3. Thus, in view of the decision cited supra and the specific enumeration of "Bhujia" in the exemption entry, we are of the view that the demand, along with interest and penalties, confirmed in respect of the said product cannot be sustained. The said demand has been raised by merely importing into Sl. No. 37 a restriction which is not there. "Cheese Balls" - Excise Appeal Nos. 75840 to 75843 of 2026 and Excise Appeal No. 75846 of 2026 13. We now turn to the other product which forms the subject matter of the present matter, namely, "Cheese Balls", which have been manufactured and cleared by the appellant in sealed containers for the various periods, ....
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.... commercially packaged for sale. 14.3. The principle finds support from the decision of the Tribunal in Parle Products Private Limited v. Commissioner of Central Excise, Mumbai-IV [Final Order No. A/90159/2017-EB dated 18.10.2017] as reported in 2017 (10) TMI 1182-CESTAT Mumbai, wherein, for a similar product, namely, "Cheeselings" the Tribunal held the same to be 'namkeen' in the common parlance understanding and, in the alternative, found them covered by the wider expression "similar edible preparations in ready-for-consumption form" occurring in the exemption entry. It was also observed that 'Namkeen' had not been defined either contextually in the notification or as a separate nomenclature in the tariff and ultimately, held the said product entitled to the benefit of the said Notification. The said reasoning is of direct relevance to the interpretative exercise before us. 14.4. The above decision has also been followed in the case of Parle Products Private Limited v. Commissioner of Central Excise, Mumbai-I, Final Order No. A/85588/2024 dated June 7, 2024 passed in Excise Appeal No. 85592 of 2015, reported in 2024 (6) TMI 680-CESTAT Mumbai. 14.5. The position is furthe....
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.... 15.1. The Revenue has taken the stand that the subject Cheese Balls do not fall within the specific description of Sl. No. 37 and has, consequently, denied the exemption thereunder. It has further proceeded on the basis that the goods, having been cleared in sealed retail pouches, would not even satisfy the condition attached to Sl. No. 38. The appellant, on the other hand, submits that its claim is founded primarily upon the specific entry at Sl. No. 37. The relevant extract of Notification No. 12/2012- C.E. dated 17.03.2012 is reproduced below: - Sl. No. Chapter or heading or tariff item of the first schedule Description of excisable goods Rate Condition No. (1) (2) (3) (4) (5) 37 2106 90 Sweetmeats (known as 'misthans' or 'mithai' or by any other name), namkeens, bhujia, mixture, chabena or similar edible preparations in ready for Consumption form, papad and jaljeera Nil - 38 2106 90 99 Food preparations not cleared in sealed containers Nil - 15.2. We find considerable force in the aforesaid contention of the appellant. As already discussed while examining the corresponding entry under Notification No. 03/2006....
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....es not disentitle them from the specific exemption otherwise available to them. 15.5. Thus, the Revenue's reasoning proceeds on an erroneous conflation of two distinct exemption entries. The fact that the subject goods were cleared in sealed retail pouches may be relevant for determining their eligibility under Sl. No. 38, but cannot, by itself, defeat their entitlement under the specific entry at Sl. No. 37. 15.6. In view of the foregoing discussion, and following our findings with respect to the corresponding entry under the erstwhile Notification No. 03/2006-C.E., we hold that the subject Cheese Balls, being namkeen/similar edible preparations in ready for consumption form, are covered by Sl. No. 37 of Notification No. 12/2012-C.E. dated 17.03.2012. Their clearance in sealed retail pouches does not constitute a disqualifying condition under the said entry. Accordingly, the appellant is entitled to the nil rate of duty under Sl. No. 37 for the periods governed by the said notification, and the corresponding demands of Central Excise duty, together with consequential interest and penalties, cannot be sustained. Scope of Tariff Sub-heading 2106 90 16. Before we conclude....