TMI Blog1984 (8) TMI 342X X X X Extracts X X X X X X X X Extracts X X X X ..... able and they submitted a classification list (C.L. ) for approval. There was some correspondence between the Superintendent and Lever. On 29-8-1974, the Assistant Collector rejected the request for clearance of the product on nil duty gate pass and directed Lever to clear the product on payment of duty at 30% ad. val. plus 50% of the basic duty as auxiliary duty pending receipt of test report from the Deputy Chief Chemist. It appears that the Chemical Examiner took a long time to conduct tests on the product. By his letter dated 6-5-1976, the Assistant Collector informed Lever that the test results revealed that Sunsilk Hair Conditioner was a preparation for the care of hair, classifiable under Item No. 14F(ii), CET without, however, specifying the sub-item- a , b , or c of 14F(ii) under which the product fell. Lever pursued the matter in appeal. The main contention was that the product was not a hair lotion, pomade or cream within the meaning of sub-item (a) nor did it fall under sub-item (b) or (c). By his order dated 14-9-1976, the Appellate Collector set aside the Assistant Collector s order and directed a de novo adjudication observing that the non-mention of the sub-ite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cified in sub-item (ii) would be covered by the entry. A plain reading of the tariff entry can, in our view, yield only this result. Unless a preparation for the care of the hair is either (a) a lotion, cream or pomade, or (b) a perfumed hair oil or (c) a shampoo, it will not fall under Item 14F(ii). The reasoning adopted by the lower authorities in the face of the clear language employed in the entry to conclude that any preparation for the care of the hair would fall under Item 14F(ii) is specious, untenable and must be rejected. Both sides are also agreed that the product under consideration is not a shampoo. Evidently again and both sides agree-the subject product is not a perfumed hair oil. We are, therefore, really left with only Item 14F(ii)(a). If the subject preparation is a hair lotion, a cream or a pomade, it will fall under the said entry, otherwise not. While the Assistant Collector did not spell out whether it was a lotion, cream or pomade, the Appellate Collector said it can be called a lotion (or a shampoo which, admittedly, it is not). On the other hand, Lever contends that the preparation is neither a hair lotion, nor cream nor pomade, and that, therefore, it fall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot used hair lotion and hair conditioner or used only lotion, would not be able to distinguish the fine line of distinction drawn between hair lotion and hair conditioner. In other words, the Appellate Collector quite illegally and untenably chose to rely upon the evidence of persons who had not used the products rather than on that of persons who had used the products. Affidavits were a normal mode of proof and could not be arbitrarily rejected without testing their veracity. (f) Having classified the goods in 1972 as non-excisable which position held good till 1975 when the product fell under the newly created residuary Item No. 68, CET, the Department cannot abruptly change the classification without a review and without cogent reasons. A few authorities were cited in this context. (g) The Collector (Appeals), by his later Order No. 1652/BI/283/81 dated 17-12-1981 (copy furnished) classified the product under Item No. 68. This order has not been reviewed by the Central Government and has become final and binding on the appellants and the Department. 8. The submissions of the learned Departmental Representative may be summarised thus (a) Sunsilk hair conditioner is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or lotion. There are many types of hair lotions such as those for growth of the hair, for controlling dandruff, for setting of the hair, for permanent waving of the hair and so on. Hair conditioner is one such lotion. The fact that it is not left on the hair would not alter this position. (c) Interpretation of terms used in a fiscal statute should not be based on static concepts but should consider latest developments in technology. A few authorities were cited in this context. Since technical books have described hair conditioning products as lotions, they should be considered as lotions. 9. We have carefully considered the submissions of both sides. As seen from the records of this case, the legend on the carton-container of Sunsilk Hair Conditioner reads as follows :- Sunsilk hair conditioner is specially formulated to take care of hair that is unmanageable after washing. It smooths out hair problems beautifully, prevents knots and tangles and makes combing so much easier. It gives hair extra body, texture and gloss. Smooth it into your hair after washing. You will find sunsilk hair conditioner teaches every hair its place-gently The product contains cetrimide, ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the shape of published standard works of reference. 12. The most important piece of evidence produced by Lever is the affidavit of Dr. Siva Raja Iyer since this affidavit was before the Collector (Appeals) who passed the order dated 17-12-1981 classifying the product under Item No. 68-CET (though not before the Appellate Collector who passed the impugned order in this case). It was available to the respondent for quite some time having been produced by Shri Lodha as early as on 5-3-1984. The respondents had ample time to file a counter affidavit if so desired. However, this was not done). From his credentials as furnished therein Dr. Iyer is indisputably an eminent scientist. He says that a hair conditioner which contains a cationic agent in alcoholic solution emulsion belongs to a series of rinse products used immediately after a hair shampooing treatment and its specific formulation makes the hair smooth, more easy to comb and hence improves its manageability. Dr. Iyer has described at length the mechanism of the action of a hair conditioner. To quote his words :- Hair is a protein (keratin) fibre consisting of amino acids joined together in long intertwining molecules. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ageability and smoothness of hair by reducing electrostatic repulsion effects. A hair lotion is a leave-on product whereas a hair conditioner is a rinsing agent . Likewise, Dr. Iyer distinguishes hair conditioner from hair cream. The latter consists mainly of mineral oil of light or medium viscosity, waxes, lanolin, preservatives, colour and perfume and emulsifying agents. Functionally, a hair cream is a leave-on grooming aid. It imparts setting properties to the hair fibres by virtue of the oil phase. A hair pomade is a semi-solid jelly like material composed of waxes incorporated in a tinted perfumed petroleum jelly. It is also a leave-on grooming agent achieving its result by acting as a physical adhesive in keeping the hair in place. Thus, on a consideration of composition, function and mode of action, Dr. Iyer concludes that hair conditioner is neither a hair lotion, nor a cream, nor a hair pomade. 13. We have briefly referred to the other affidavits. Dr. Narayanan s affidavit is more or less on the same lines as that of Dr. Iyer and Dr. Atul T. Kaji merely supports the deposition of Dr. Narayanan. Two consumers have testified that hair conditioner is differ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y over the hair while the head is held over a basin. The cream or lotion is left on the hair for a few minutes and then rinsed off with warm water. 15. In the book A Formulary of Cosmetic Preparations compiled by Michael and Irene Ash, hair conditioning products are stated to be used to give the hair manageability, gloss and soft texture. They are generally used on hair that has been damaged by too frequent shampooing, bleaching, dyeing, permanents and hair straighteners. Under the head Hair Conditioner , different formulae are specified, one in respect of cream and another in respect of lotion. In the book Cosmetics, Toiletries and Health Care Products Recent Developments by George W. Owens, the formulation of lotion hair conditioner (lotion balsam type) has been described. 16. The aforesaid books were cited by the Departmental Representative to show that hair conditioners come in two forms as lotion or cream and that it is not always necessary that a hair conditioner should be rinsed off after application to the hair. In our view, all that these authorities show is that hair conditioner could be in the form of a cream or lotion. That, however, is not the issue before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by Lever, it cannot be said to fall in any such categories; it is for better hair management by its property of reducing electrostatic repulsion effects. No doubt, the technical authorities cited by the Departmental Representative do refer to hair conditioners as creams or lotions but these do not add up to an effective rebuttal of the evidence produced by Lever as to how the trade, users, dealers and experts in our country understand these terms. 17. The Appellate Collector, in his order of 19-12-1981, has referred to certain technical authorities (i) Formulation and Function of Cosmetics by Jellinck (ii) Cosmetics Science and Technology by Sagarin. (iii) Modern Cosmeticology Ralph C. Harry. The Appellate Collector gives the following passage from one of the books on hair lotions Hair lotions are alcohol-containing products which have been popular since the turn of the century. By diluting viscous oils with alcohol, it is possible to get good wetting action and after evaporation of the alcohol, deposition of a uniformly thin layor of oils. Furthermore, the temporary stimulation received from the alcohol on the scalp is liked by many people. Castor oil is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the above discussions, we hold that during the relevant period Sunsilk Hair Conditioner did not fall for classification under Item No. 14F(ii) of the CET but under Item No. 68, CET from the date of insertion of the latter item in the Tariff. 21. While arriving at the above conclusion, we have kept in view the well-settled principle of law that the burden to prove that a product falls under a specified entry in the tariff schedule lies on the revenue. We are not, therefore, referring to the case law cited by Shri Lodha in this connection. Shri Lodha had also cited case law in support of his contention that a change in the Department s stand without cogent reasons is impermissible, that affidavit is a normal mode of proof and a few other propositions. Since we are allowing the appeal, we do not think it necessary to refer to these authorities. The SDR, on her part, had cited certain authorities to support the proposition that interpretation of terms in a fiscal statute should consider latest developments and technology and that it should not be a static concept. There cannot possibly be any quarrel with this and, therefore, we are not referring to these authorities as well. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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