Page 243 - ELT_1st August 2020_Vol 373_Part 3

2020 ] DHARAMPAL PREMCHAND LTD. v. COMMISSIONER OF CENTRAL EXCISE, NOIDA 425

3. The goods manufactured by the appellants, with the aid of packing
machine, installed in their factory are notified goods under sub-section (1) of Sec-
tion 3A of the Central Excise Act, 1944. With effect from 27-2-2010, the “Chewing
Tobacco and unmanufactured Tobacco Packing Machine (Capacity Determina-
tion and Collection of Duty) Rules, 2010” came into effect and the manufacturer
of notified goods was required to file declaration in Form-1 in terms of the provi-
sions of the said rules, declaring the number of packing machines installed in his
factory so as to calculate duty for a particular month in respect of such operating
packing machines and to pay the duty accordingly on monthly basis. As the ap-
pellant was the manufacturer of such notified goods, they filed declarations in
terms of the provisions of Rule 6 of the said rules, declaring the product as
“chewing tobacco” falling under Central Excise Tariff Heading 2403 99 10. While
granting approval to the said declaration, the Original Adjudicating Authority
held that product being manufactured by the appellant was not chewing tobacco
but the same was Jarda Scented Tobacco instead of Chewing Tobacco, (without
lime) as declared by the assessee. Accordingly, he held that the same is appropri-
ately classifiable under Heading 2403 99 30. Seven appeals are arising against the
said change in classification, which classification also stands approved and up-
held by Commissioner (Appeals). The balance appeals are confirming the duty of
Excise, as a consequence of such change in classification. In one of the appeals
the abatement granted to the appellant stand appropriated towards their duty
liability and on the appellants filing the refund of the same, such refund stands
rejected.
4. After hearing both the sides duly represented by Shri T.R. Rustagi
Learned Advocate appearing for the appellants and Shri Sandeep Kumar Singh
Learned A.R. appearing for the Revenue, we note that the crux of the issue re-
quired to be decided in the present appeals is whether the appellants’ product
declared by them as “Chewing Tobacco” is actually chewing tobacco or the same
is “Jarda Scented Tobacco” (hereinafter referred to as Zarda) falling under Head-
ing 2403 99 30 and attracting higher rate of duty.
5. Learned Advocate Shri T.R. Rustagi appearing for the appellants
have strongly contended that the goods manufactured by the appellants is noth-
ing but Chewing Tobacco. He clarified that prior to 2015, Chewing Tobacco as
also Jarda Scented Tobacco were attracting the same rate of duty and as such the
declaration filed by them declaring their goods as a Chewing Tobacco was being
approved by the Revenue without any changes. It is only for one year the rate of
duty on Zarda was enhanced and the Revenue took objection to their product
being Chewing Tobacco and classified the same as Jarda Scented Tobacco. It is
the contention of the Learned Advocate that once the classification has not been
changed for years together, the same cannot be subsequently amended. He also
submits that Rule 6 of the said rules gives no power to the Assistant Commis-
sioner/Deputy Commissioner to check the correct classification inasmuch as in
terms of the said rule, the proper officer is required to verify only the number of
machines and the rotation per minute so as to fix the duty liability of the as-
sessee. He further submits that reliance by the Lower Authorities on the decision
of Orissa High Court in the case of Mishra Zarda Traders v. State of Orissa - 1988
(15) E.C.C. 124 holding their product as Zarda is not appropriate inasmuch as the
said decision was in the context of Sales Tax whereas the dispute involved in the
present appeal is vis-à-vis Excise duty. He further submitted that the Lower Au-
thorities relied upon the test report of the sample obtained from their other unit
EXCISE LAW TIMES  1st August 2020  243