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2015 (9) TMI 1206 - CESTAT MUMBAI

2015 (9) TMI 1206 - CESTAT MUMBAI - 2015 (324) E.L.T. 594 (Tri. - Mumbai) - Classification of the product Niacin (feed grade) - animal feed - Chapter Heading 29.36 or Tariff Item 23099090 - Held that:- Tariff Item 29362920 specifically covers Nicotinic acid (nicotinamide). Following cannons of interpretation of the Central Excise Tariff, a more specific heading is to be preferred in terms of Rule 3(a) of the Rules for Interpretation of the Tariff Act. Even according to the HSN Notes of Chapter 2 .....

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no difference because we are concerned with the classification of the product manufactured by them i.e. Niacin. Therefore we hold that the product Niacin Feed Grade has been correctly classified under Tariff Item 29362920 and duty is payable accordingly.

Extended period of limitation - Held that:- The appellant had clearly declared the description of the product as "Niacin Feed Grade" in all their E.R. 1s. Therefore there being no misstatement, duty is payable only for the normal per .....

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mber (J), JJ. For the Appellant : Shri R V Shetty, Adv For the Respondent : Shri V K Agarwal, Additional Commissioner (AR) ORDER Per P S Pruthi This appeal is directed against Order-in-Original No. II/PKA/COMMR/Th-II/2012 dated 21.5.2012 passed by the Commissioner of Central Excise, Thane-II. 2. The main issue in this appeal is the classification of the product Niacin (feed grade) manufactured by the appellant. The appellant manufacture bulk products like Niacin falling under Chapter Heading 29. .....

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he duty demand of ₹ 65,43,700/- invoking the extended time period. He also imposed equivalent penalty under Section 11AC of the Act. The goods valued at ₹ 6,54,57,800/- cleared without payment of duty were subjected to fine of ₹ 33,00,000/- in lieu of confiscation under Section 34 of the Act. 3. Heard both sides. 4. The contentions of the appellant are - (i) The product in question does not satisfy specification of Indian Pharmacopaeia and, therefore, rightly classifiable under .....

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er Heading 2309. (iii) Niacin (Vitamins) cannot be equated with Niacin (Feed Grade) because the later has purity of 95% and is specially prepared for use in animal feed. (iv) Tribunal in the case of M/s. Roche Products Ltd. Vs. CCE Order No. 1101/9C dt. 9.10.1990 classified identical products in under Heading 2303.00 (v) The benefit of Cenvat Credit should not be denied and Central Excise duty should be reduced to that extent. (vi) They are entitled for cum-duty price benefit to arrive at the as .....

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description of the goods was shown as Niacin, (Feed Grade). 5. The Ld. AR contended that Chapter Note 1 to Chapter 23 states that Heading 2309 includes products of a kind used in animal feeding, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material. Whereas the product in dispute is obtained by a chemical process. He further stated that description of CH 2309 itself refers to animal feed preparations. Ev .....

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that the process of manufacture of Niacin follows a synthetic route and it is manufactured from chemicals. The process involved and the raw materials used are the same for Niacin I.P. Grade as well as Niacin (Feed Grade). Niacin Feed Grade is crude Niacin with 95% purity. Therefore, Niacin I.P. Grade is formed by increasing the purity to 99%. Thus, the only difference is in purity and further steps required for making 99% Pure Niacin. Even the Niacin meant for feed grade is labeled on the conta .....

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cludes products of a kind used in animal feeding............... obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material........" On reading this note itself, we would disagree with the appellant that their product is covered under heading 2309. Their product is not obtained by processing vegetable of animal material. Their product is obtained from chemicals i.e. Beta Picoline, Sulphuric Acid, Nitric Ac .....

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ading 23.09 it is specifically mention in exclusion clause (e) that vitamins are excluded from heading 23.09. We may also mention that the case law cited by the Ld. AR supports the classification under Tariff Item 29362920. On the other hand, the citations and Board circulars cited by the Ld. Counsel only establish the classification of the goods which are actually preparations used in animal feed. In the present case the goods are not a preparation for animal feed. The goods are Niacin itself. .....

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