Commissioner of Central Excise, Kanpur Versus Pacific Leather (P) Ltd.>2011(06)LCX0055

2011(06)LCX0055

IN THE CESTAT, PRINCIPAL BENCH, NEW DELHI

S/Shri M.V. Ravindran, Member (J) and M. Veeraiyan, Member (T)

Commissioner of Central Excise, Kanpur

Versus

Pacific Leather (P) Ltd.

Final Order Nos. C/266-268/201I(PB), dated 21-6-2011 in Appeal Nos. C/360 & 371-372/2007

Cases Quoted -

Associated Finishing Agency v. Commissioner - 2011-TIOL-62-CESTAT-MAD - Distinguished [Paras 5,7]

Prema Colors and Chemicals v. Commissioner - 2008 (231) ELT 0096 (Tribunal) - Distinguished [Paras 5,7]

Advocated By -

Shri Sonal Bajaj, SDR, for the Appellant.
None, for the Respondent.

[Order per : M. Veeraiyan, Member (T)]. -

These three Appeals by the department involve common issues and therefore are being dealt with by this common order.

2. Heard learned SDR. None appears for the respondents in spite of no-tice.

3. The relevant facts in brief are that the respondents imported goods claiming to be Sulphonated Fish Oil seeking classification under chapter subheading 3402 90 20. The imported products were in fact declared in the bills of entry as follows:

"Sulphonated Fish Oil OPTTMALIN UPNC" (in the case in appeal No. C/371/07)

"Sulphonated Fish Oil ADUVAX LB & OPTTMALIN UPNC" (in the case in appeal No. C/360/07)

"Sulphonated Fish Oil SULCODOL CI", (in the case in appeal No. C/372/07)

4. The department allowed provisional clearance of the goods after drawing samples which were sent to Central Revenue Control Laboratory (CRCL) for testing. As per test reports, "the sample was a preparation having Sulphonated Fish Oil and additives." On the basis of test reports, the show cause notices were issued proposing classification of the imported products under chapter sub-heading 3403 91 00 as "preparation of a kind used for oil or grease treatment of textile material, leather for skins or other materials". The respondents contested the show cause notices and produced test reports obtained from Central Leather Research Institute (CLRI), according to which surface active function is subsidiary to the main function of fat-liquoring. The original authority confirmed classification as proposed in the show cause notices and finalized assessment of bills of entry and demanded differential duty. On appeal to the Commissioner (Appeals), the Commissioner (Appeals) has set aside the orders of the original authority. Hence, the department is in appeal before the Tribunal.

5. Learned SDR submits that the test reports of the CLRI clearly men-tioned the product as 'preparation having Sulphonated Fish Oil and additives" and therefore they cannot be treated as "Sulphonated Fish Oil". Therefore the classification claimed by the respondents is not acceptable. He also relied on technical literature produced by the respondents in respect of ADUVAX LB wherein it is opined that the product is "fat liquor agent" giving the most softness which was being used specially in leather etc. Drawing our attention to this description which reads as "oil based on Sulphonated Fish Oil', he submits that these products should not be treated as "Sulphonated Fish Oil" and considering the use of these items for the purpose of fat liquoring, they should be treated as falling under chapter sub heading 34039100. In this regards, he relied on the decision of the Tribunal in the case of M/s. Associated Finishing Agency v. CC, Chen-nai reported in 2011-TIOL-62-CESTAT-MAD and the decision in the case of Prema Colors & Chemicals v. CC, Chennai reported in 2008 (231) ELT 96.

6. We have carefully considered the submissions and perused the records. At the outset, we note that the burden to prove classification of the im-ported products is on the department. We are dealing with classification of items claimed as "Sulphonated Fish Oil", a chemical. The chemical examiner's report relied upon by the department referred to the imported materials as "the sample was a preparation having Sulphonated Fish Oil and additives." The additives have not been identified. Whether the presence of additives will make the product different from "Sulphonated Fish Oil" depends upon the nature and the quantity of additives. This fact is not available in the chemical examiner's report relied upon by the department. The end use of the imported product, whether the same is used for fat liquoring or other purpose, will be relevant only if the said product goes outside the description of "Sulphonated Fish Oil". There is no expert opinion relied upon as to the different uses of the "Sulphonated Fish Oil". The technical opinion relied upon in respect of ADUVAX LB describe the nature of the product as "oil based on Sulphonated Fish Oil". At the same time, there is clear opinion "ADUVAX LB" is a "strong Sulphonated Fish Oil". This in fact supports the view of the respondents rather than the claim of the Revenue. Therefore, in our considered opinion the imported products deserved to be considered as Sulphonated Fish Oil and the term Sulphonated Fish Oil being specifically mentioned under chapter sub-heading 3402 90 20, the same deserve to be given preference over the other tariff item 3403 91 00 as rightly concluded by the Commissioner (Appeals) relying on Rule 3(a) of Rules of Interpretation of Customs Tariff, 1975 which envisage giving preference to most specific description.

7. The decision of the Tribunal in the case of M/s. Associated Finishing Agency is on a clear finding that the goods imported by the appellants in that case was found on test by the Customs Lab to be "fat liquor" and not "Sulphonated Fish Oil". Similarly, the decision of the Tribunal in the case of Prema Colors & Chemicals is on the appreciation of fact that the sample of the product in the said case did not show the presence of "Sulphonated Fish Oil". These two cases therefore, are clearly distinguishable from the facts of the present case.

8. In view of the above, we do not find any reason to interfere with the decision of the Commissioner (Appeals) which are based on appreciation of test reports of CRCL and application of Rule 3(a) of Rules of Interpretation of Customs Tariff, 1975.

9. The appeals are therefore rejected.

(Pronounced in the open court)

Equivalent 2011 (272) ELT 0395 (Tri. - Del.)