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2017 (9) TMI 346 - AT - Central ExciseClassification of goods - Chewing Tobacco - N/N. 8/2003-CE dated 01/03/2003 - compounded levy scheme - whether the product would be classified under CTH 24039910 or otherwise? - Held that: - Admittedly, the scope of the term “Chewing Tobacco” has not been statutorily defined in the Central Excise provisions. The claim of the appellant is that the product manufactured by them is lime mix tobacco and not Chewing Tobacco. The Original Authority relied on the appellant’s declaration made to the Department on 18/12/2007. A reference had also been made to a letter dated 29/11/2010 of the appellant explaining the process of manufacture. Tobacco powder/dust/refuse and the lime combined with water in pre-determined proportion are fed into power operating mixing machine to obtain tobacco mix with lime, which is their final product. We note that relying on the explanatory notes under Chapter 24 of HSN, the Original Authority correctly rejected the contention of the appellant that the product, in question, should be considered as “homogenized” or “reconstituted” tobacco. It is clear that the product manufactured by the appellant cannot fall under that category which are classified under Central Excise Tariff Heading 24039100. Compounded Levy scheme - the appellants contested that the rate of duty as determined by the 1st Schedule to Central Excise Tariff Act readwith notification for SSI Notification No.8/2003-CE should apply to them. In fact, they contested that Chewing Tobacco cannot be brought under the 2010 rules for compounded levy - Held that: - The compounded levy scheme is framed in terms of the statutory powers provided under Section 3A of the Central Excise Act, 1944. The said section clearly stipulates that notwithstanding anything contained in Section 3, the Central Government can notify in respect of specific goods that the duty shall be levied and collected in accordance with the provision of Section 3A. The Original Authority has correctly examined the applicability of compounded levy scheme w.e.f. 08/03/2010, to the products manufactured and cleared by the appellant and confirmed the duty liability accordingly. Use of brand name in the product - It is claimed by the appellant that the name appearing in the pouches is only to show the manufacturer and there is no branding of the product - Held that: - On perusal of the sample packages, we are satisfied that there is an identifiable distinct branding of these products which have the effect of linking the product to a particular person, among the consuming public. As such, we find no merit in the claim of the appellant that these are not branded Chewing Tobacco. It also noted that the packages clearly carried a warning that Chewing Tobacco is injurious to health. Such endorsement clearly discounts the argument of the appellant that their product cannot come under the general category of Chewing Tobacco. Regarding the claim of the appellant for exemption under N/N. 8/2003-CE available to small scale units we note Chewing Tobacco bearing a brand name is excluded from the products listed in annexure of notification for such exemption. Appeal dismissed - decided against Appellant.
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