Classification of Jiljira is mixture of species and classifiable under Chapter 9.

PJ/Case Laws/2012-13/1220

Case:Ashok Grih Udhyog Kendra Ltd. V/s Commissioner of C. EX., Kanpur

Citation:2012 (282) E. L. T. 575 (Tri. – Del.)

Issue:- Classification of Jiljira is mixture of species and classifiable under Chapter 9.

Brief Facts:- The appellant is manufacturer of spices and masalas including "Jaljeera" and "Hazmi". According to the appellant said two items are classifiable as "packed masala" under Chapter 9 of the Central Excise Tariff Act, 1985 and exempted from the incidence of excise duty whereas according to the department those two items does not fall within the category of spices and are classifiable under Chapter [21] of Central Excise Tariff Act, 1985, under Entry No. 210899.

Appellant’s Contention:- It is submitted by the appellant that impugned order is not sustainable in law for the reason that the Adjudicating Authority has misread the classification entries. Learned Counsel relying upon the judgment of Hon'ble Supreme Court in the matter of Commercial Taxes Officer v. Jalani Enterprises reported in (2011) 4 SCC 386 = 2011 (266) E.L.T. 289 (S.C.) submits that in the aforesaid matter the issue before the Hon'ble Supreme Court was whether Jaljeera could be termed as masala and the Hon'ble Supreme Court after taking note of ingredients of Jaljeera concluded that Jaljeera is nothing but a mixture of different spices prepared after grinding and mixing, as such, it is nothing but "packed masala" sold to the consumer.Learned Counsel submits that similarly "Hazmi" is also a mixture of grinded spices, as such, going by the ratio by the judgment of Hon'ble Supreme Court it also falls within the category of "packed masala". Thus, according to the learned Counsel of the appellant Jaljeera and Hazmi are classifiable under Chapter 9 of the Central Excise Tariff Act, 2011 and 2012 under Entry No. 0903.10. Learned Counsel has thus concluded that appellant has a strong prima facie case which justifies the waiver of condition of pre- deposit. It is also argued that if the appellant is called upon to deposit the amount of demand, interest and penalty would cause undue hardship to the appellant.

Respondent’s Contention:- Shri S.R. Meena on the contrary has argued in support of the impugned judgment. He submits that the Adjudicating Authority has rightly concluded that Jaljeera and Hazmi are classifiable under Chapter 21 of the Central Excise Tariff Act, 1985. Learned AR has also tried to distinguish the judgment of Hon'ble Supreme Court relied upon by the learned Counsel of the appellant that judgment is in contest of Sales Tax Act and not under Central Excise Act. Respondent further submits that earlier the Tribunal in the matter of Jalani Enterprises v. CCE, Jaipur reported in 2001 (132) E.L.T. 422 (Tri.-Del.) had an occasion to deal with the classification of Jaljeera for the purpose of excise duty and the Tribunal concluded that the Jaljeera was classifiable under Chapter 21 of the Central Excise Tariff Act, 1985 and appeal against the judgment is still pending.

Reasoning of Judgement:-Adjudicating authority after considering the rival submissions and perusing the record held that from the judgment of Hon'ble Supreme Court it prima facie appears that any mixture of grinded spices packed in a packet can be termed as "packed masala". Thus, prima facie Jaljeera and Hazmi are packed masala classifiable under Chapter 9 of Central Excise Tariff Act, 1985 particularly Entry No. 0903.10. Tribunal held that the appellant has been able to make out prima facie case for waiver of the condition of pre-deposit. Stay application is accordingly allowed and the deposit of demand, interest and the penalty thereof is waived till disposal of the appeal.

Decision: - Application allowed.

Comment:- This is very important case where in the relied upon decisions by both the parties were of same manufacturer. The party viz. “Jalani Enterprises” lost his excise case when the CESTAT held that the Jaljeera is a drink and classifiable under Chapter 21. The party has pleaded in this case that their product is mixture of species and classifiable under Chapter 9. The same party also lost the case of Sales tax before Apex court where it was held that it is mixture of species. But the other party relying on the Apex court decision is winning the case before CESTAT. Nothing is certain in legal matters.

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PJ/Case Laws/2012-13/1220

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