Customs, Excise and Gold Tribunal - Bangalore
Commissioner Of Central Excise vs T.T.K. Pharma Ltd. on 12 May, 2005
Equivalent citations: 2005(190)ELT214(TRI-BANG)
ORDER S.L. Peeran, Member (J)
1. This is a Revenue appeal against O-I-A No. 19/2002-C.E., dated 31-1-2002. The Respondents have been served with notice through Commissioner. They have filed their cross-objections and have not appeared to argue the case. The DR was heard in the matter.
2. The assessees are manufacturing 'fryums'. They claim the same to be similar to the popularly known as 'papad' and to be consumed only after processing like frying. They had given a step by No. 5 of the Notification No. 5/99, dated 28-2-99 granted the benefit of exemption to goods falling under subheading 2108.99. The said Sl. No. 5 of the Notification reads as hereunder.
"Sweet meats, known as misthans or mithai or by any other name. Nam-keens, bhujia, mixture, chabena and similar edible preparations in ready for consumption form and papad."
The Revenue took the stand that 'fryums' do not fall under any of the items indicated in the Sl. No. 5 of the Notification. The Commissioner after detailed examination negatived the contention of the assessee that it falls within the description of the item in Sl. No. 5 of the Notification. The finding recorded by him in para 4 is reproduced herein below :
"I have carefully gone through the grounds of appeal as well as submissions made at the time of personal hearing. It is observed that the lower authority has confirmed the demand and imposed penalty on the count that the appellants are not eligible for the benefit of exemption under Notification No. 5/99, dated 28-2-99.
It is observed that the appellants are the manufacturers of Namkeen. Ready to fry snacks 200 gms packs bearing brand name falling under 2108.99. It is seen that the product under classification they have described the process of manufacture of goods, i.e., the main raw materials used such as rice flour, wheat flour, edible oil starch, salt and spices are blended mixture.
Water is added to the blended material to bring up the moisture content to form a dough. This dough is thermally conditioned and pressed though a die where the rotating knife cuts the product into uniform pieces. The pieces are skin dried so that they do not stick each other and then further dried to remove the residual moisture. This results in hard dry product. The dried product is packed in unit packs. The finished products are popularly known as "papads" and the same is to be consumed after frying. It is observed that the appellants manufactured namkeens is nothing but papad and the "namkeen" is the word popularly used in Northern India which is covered under the exemption Notification No. 5/99, dated 28-2-99.
It is seen as per only Sl. No. 5 of the said Notification No. 5/99, dated 28-2-99 sweetmeats known as misthan or mithai or by any other name, namkeens bhujia, mixture, chabena and similar edible preparation is ready for consumption form and papad are fully exempted from payment of duty.
It is also observed from the nomenclature and the process of manufacture that the fryum manufactured by them are nothing but papads and their claim for the benefit of availing the benefit of exemption cannot be disputed.
In view of the above, I set aside the Order of the lower authority and the appeal filed by the appellants is allowed accordingly".
The Revenue contend that the "fryums" cannot be equated with "namkeens" and "papad". They stated it is an afterthought made for availing the benefit of the notification. It is stated that "fryums" are not marketed as papads but were marketed as namkeens ready to eat "fry snacks". The marketing/description on the pack described the product as namkeens and not as 'papads'. Hence the item being not papad should have been denied the benefit. They rely on the earlier Tribunal Order noted assessee's own case wherein the item has been held to be namkeens.
3. We have considered the submissions made by the assessee. In their cross-objection also, they have given the process of manufacturing of fryums and contend that it is exact process of manufacture of snack known as papad. This snack is to be consumed only after processing like frying. They stated that they never-stated that papad is not well-known or not used in North India. There was no misrepresentation/misstatement by them and contend that it is only the department which is misrepresenting this aspect in the present appeal. They rely on the Final Order of the Tribunal in E/369/92 D, dated 2-9-92 and contend that in any case the item is covered in the description of the Sl. No. 5 of the Notification. On a careful consideration we notice that the Commissioner has given a clear finding that the item is covered by the description in Sl. No. 5 of Notification 5/99. He has seen the process of manufacture and found them to be akin to 'papad' as the same is to be consumed after fry. He has also found that appellants manufacturing namkeens which are nothing but pa-pad and the namkeens and it fits into the various items in Sl. No. 5 of the Notification as it is similar to preparation ready for consumption and are exempted.
3. It is seen from the appellants own case that this item fryums was considered for exemption in Sl. No. 8 of Notification No. 12/90-CE., dated 28-3-90 which had the description of the terms papad, idly-mix, vada-mix, dosa-mix, jelebi-mix, gulab jamun-mix and namkeens such as bhujia, chabena. The detailed findings given by the Bench to hold that the item is akin to chabena which is also namkeen in any case in para 8 is as follows :
8. The parts of the notification and Sl. No. 8 in the Table is reproduced below :-
"In exercise of the powers conferred by Sub-section (1) of Section 5A of the Central Excises and Salt Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods specified in column (3) of the Table hereto annexed and falling under the sub-heading No. of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), specified in the corresponding entry in column (2) of the said Table from so much of the duty of Excise leviable thereon which is specified in the said Schedule as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4) thereof-
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S. No. Sub-heading Goods Rate
8 2107.91 Papad, Idli-mix, Vada-mix, Nil
Dosa-mix, Jalebi-mix, Gulab-
jamun-mix or namkeens such
as Bhujiya, Chabena
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The Sl. No. 8 reproduced above mentions about various goods coming within sub-heading 2107.91. It has given illustration to the items Namkeens such as Bhujiya, Chabena. Now the question is as to whether these namkeens given in the notification is a general one including all types of namkeens or only to the type given therein like Bhujiya, Chabena by illustration. The learned Collector has interpreted the words 'such as' to mean namkeen should be of a kind of Bhujiya and Chabena. Although it is not in dispute that the item in question is a namkeen. As can be seen from the various items given in Sl. No. 8 namely, Papad, Idli-mix, Vada-mix, Dosa-mix, Jalebi-mix, Gulabjamun-mix are all of a type which cannot be eaten straightaway but it requires to be fried. Chabena also comes in a type of item which requires to be chewed like Potato chips or fried Channa Masala or various types of fried masala dais. There can be any number of examples of namkeens in the form of Chabena which are mostly taken as a side dish. It can also be preferred to be eaten after sweetmeat. The item in question being like a Chabena is also a namkeen. The learned Collector's placing restriction that it is to be eaten only after frying and therefore, is not covered under the notification is a very strict way of reading a notification. The notification cannot be read in a way as to whittle down its expression or to make the notification otios. The words 'such as' is only illustrative and not exhaustive. So long as the item satisfies the term Namkeen, the benefit of notification cannot be denied on the ground that it requires to be fried before use. There is no such understanding placed in the notification with regard to the frying of the item. Even if that be so, then the same would apply to all other items which are namkeens like Papad, Idli-mix, Dosa-mix, Jalebi-mix etc. which are required to be fried before they can be eaten.
8A. The learned Advocate has brought to our notice the manner in which the illustrative words 'such as' have been understood. We take strength from the rulings produced before us."
The above paragraph clearly indicates that the item is covered in the generic terms. It is to be considered as namkeen/papad which are to be required to be fried before they are consumed. The finding recorded by the Commissioner is just and proper. There is no infirmity in the same and the appeal is rejected in terms of the earlier order rendered in the assessee's own case.
(Pronounced in open Court on 12-5-2005)