Page 272 - ELT_1_1st April 2020_Vol 372_Part

158 EXCISE LAW TIMES [ Vol. 372

were Afzal Brand Snuff Tobacco and were to be delivered to M/s. Sopariwala
Exports Pvt. Ltd. It was alleged that the goods were intended to be cleared with-
out payment of duty and hence were put under seizure. Statements of Shri Sal-
imbhai Yakubbhai Momin, supervisor, Shri Sirajbhai Gulamnabi Vekariya, Ac-
countant, Raffique Sattar Kachhi, Manager, Shri Arif Abdul Kadar Fazlani, and
Shri Faisal Yunusbhai Fazlani, directors were recorded. The premises of SEPL
was also searched and documents were seized. The show cause notice contended
that Tobacco and manufactured Tobacco substitutes are covered under Chapter
24 of the Explanatory Notes to the Harmonised Commodity Description and
Coding System. That excerpts from the said explanatory notes on “unmanufac-
tured tobacco” as available at Page No. 205 states as under :
“Unmanufactured tobacco in the form of whole plants or leaves in the
natural state or as cured or fermented leaves, whole or stemmed/stripped,
trimmed or untrimmed, broken or cut…”
1.2 That only when following processes are done on tobacco
plant/leaves, the resultant tobacco product would be construed as unmanufac-
tured tobacco. By implication, if any other process beyond those mentioned be-
low is performed on the tobacco plant/leaves, it would mean that the resultant
product cannot be classified as “manufactured tobacco” :
- Curing
- Fermentation
- Stripping
- Trimming
- Cutting
1.3 That in the instant case, the processing is definitely transgressing
the boundaries demarcated for a product to be classified under unmanufactured
tobacco. Further, M/s. BTCPL are undertaking the process of drying, cutting and
then crushing/grinding on the leaves of tobacco by various machines in their
premises. Through these processes, the leaves of tobacco are converted into
powder form and this tobacco powder is identified by the assessee as Gadia
Powder. Further, as per the Board’s Circular No. 01/88, dated 21-3-1988 issued
vide file No. 81/2/88-CX-3, it was held that deliberate powdering of tobacco
leaves was definitely a process of manufacture and as such “tobacco powder”
would be appropriately classifiable as a “manufactured tobacco product”. The
samples of Afzal brand Snuff Tobacco and Tobacco powder were sent to the
Chemical Examiner at Vadodara on 25-1-2008 for testing, who vide his letter No.
RCL/AH/Prev./49/1173, dated 28-3-2008 reported that “The sample is in the
form of coarse brown powder. It is other than snuff. The sample U/R may be
considered as manufactured Tobacco”. Vide letter No. RCL/AH/Prev./48/117,
dated 28-3-2008, the Chemical Examiner reported that “the sample is in the form
of brown powder. It is other than Snuff. The sample U/R may be considered as
manufactured Tobacco”. Further, the Chemical Examiner, CECL, Vadodara vide
his letter F. No. RCL/AH/Prev./48-49/08-09, dated 22-4-2009 communicated the
ingredients in both samples of manufactured products. He reported, as under :-
(1) Afzal brand snuff Tobacco : The sample mainly contains tobacco pow-
der and in smaller quantities of Calcium Oxide (CaO), Katha, Fla-
vouring agents.

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