M/S. Eastern Condiments Pvt. Ltd vs Cce, Madurai on 11 June, 2015

[Cites 24, Cited by 3]

Custom, Excise & Service Tax Tribunal

M/S. Eastern Condiments Pvt. Ltd vs Cce, Madurai on 11 June, 2015

        

 
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI


E/Misc./186/2013 & E/709/2009


(Arising out of Order-in-Original No.1/2009-CE dated 23.9.2009 passed by the Commissioner of Central Excise, Madurai)

M/s. Eastern Condiments Pvt. Ltd.			Appellant

      
      Vs.


CCE, Madurai						        Respondent

Appearance Shri N. Venkataraman, Senior Advocate for the Appellant Shri M. Rammohan Rao, DC (AR) for the Respondent E/Misc./42303/2013 & E/226/2008 E/337/2008, E/40288/2014 (Arising out of Order-in-Original No. 4/2008 dated 29.2.2008 O/O No. 7/2008 dated 15.5.2008 passed by the Commissioner of Central Excise, Chennai - IV and Order-in-Appeal No. 247 & 248/2013 (M-IV) dated 19.11.2013 passed by the Commissioner of Central Excise (Appeals), Chennai) M/s. Aachi Masala Foods Pvt. Ltd. Appellants Vs. CCE, Chennai II & IV Respondent Appearance Shri N. Viswanathan, Advocate for the Appellant Shri M. Rammohan Rao, JC (AR) for the Respondent E/Misc./42302/2013 & E/227/2008 E/336/2008, E/40297 to 40301/20014 (Arising out of Order-in-Original No. 4/2008 dated 29.2.2008; O/O No. 7/2008 dated 15.5.2008 passed by the Commissioner of Central Excise, Chennai - IV and Order-in-Appeal No. 247 & 248/2013 (M-IV) dated 19.11.2013 passed by the Commissioner of Central Excise (Appeals), Chennai) M/s. S. Nazareth Foods Pvt. Ltd. Appellants Vs. CCE, Chennai II & IV Respondent Appearance Shri N. Viswanathan, Advocate for the Appellant Shri M. Rammohan Rao, JC (AR) for the Respondent E/353 & 354/2010 and E/40380 & 40381/2014 (Arising out of Order-in-Original No.5 & 6/2010-CE dated 22.4.2010 passed by the Commissioner of Central Excise, Madurai and Order-in-Appeal No. 241 & 242/2013 dated 5.12.2013 passed by the Commissioner of Central Excise (Appeals), Madurai) M/s. Maami Foods Pvt. Ltd. Appellants Vs. CCE, Madurai Respondent Appearance Shri M.S. Srinivasa, Senior Advocate for the Appellant Shri M. Rammohan Rao, JC (AR) for the Respondent E/638/2009 and E/299 & 300/2011 (Arising out of Order-in-Original No.6/COMMR/CE/2009 dated 24.9.2009 passed by the Commissioner of Central Excise, Tirunelveli and Order-in-Appeal Nos. 103 & 104/2011 dated 28.2.2011 passed by the Commissioner of Central Excise (Appeals), Madurai) M/s. Avitaa Foods Products Appellants Vs. CCE, Tirunelveli Respondent Appearance Shri S. Murugappan, Advocate for the Appellant Shri M. Rammohan Rao, JC (AR) for the Respondent E/42108/2013 & E/40992/2104 (Arising out of Order-in-Appeal No.212/2013 dated 31.7.2012 & Order-in-Appeal No. 18/2013 dated 24.2.2014 passed by the Commissioner of Central Excise (Appeals), Madurai) M/s. Arumuga Consumer Care Appellant Vs. CCE, Tirunelveli Respondent Appearance Shri S. Murugappan, Adv.(for Avitaa and Arumuga) Shri N. Venkataraman, Sr. Counsel.,(for Eastern Condiments) Shri Harish Bindhumadhavan Shri N. Viswanathan, Adv., (for Aachi Masala and Nazareth) Shri M.S. Srinivasa, Adv., (for Maami Foods) Ms. Sridevi, Adv.

Shri M. Rammohan Rao, JC (AR) for the Respondent CORAM Honble Shri R. Periasami, Technical Member Honble Shri P. K. Choudhary, Judicial Member Dates of Hearing /Decision: 11.06.2015 Final Order Nos.: 41820-41839 / 2015 Per R. Periasami All the 20 appeals are taken up together as the issues involved are identical in nature relating to classification dispute of mixed spices (masala powder) under Chapter 9 or under Chapter 2103.

2. The brief facts of the case are that all the six appellants are manufacturers of various spice powders and mixed spices which are commonly called as masalas and they classified the goods as mixed spices under Chapter 0910 9100 of CETA whereas the Department proposed to classify them under Chapter Heading 2103 9040 as mixed condiments and mixed seasonings under Chapter 21 of CETA, 1985. The adjudicating authorities, after following the principles of natural justice, classified these products under Chapter 2103 9040 and confirmed the demands and also imposed equivalent penalty. The details of description, duty and penalty imposed on each appellants are listed as under:-

I. M/s. Eastern Condiments P. Ltd.

They are manufacturer of 13 items viz., Meat masala, sambar masala, Biriyani masala, rasam powder, pickle masala, vegetable masala, kulambu masala, thandoori masala, pav bhajji masala, garam masala, channa masala, chat masala and kabab masala etc. M/s. Eastern Condiments P. Ltd.

Appeal No. Demand Penalty Imposed Personal Penalty E/709/2009 Rs.3,35,45,983/-

Rs.3,35,45,983 Rs.50,00,000/-

Rs.70,87,767/-

II. M/s. Aachi Masala Foods P. Ltd.

They are the manufacturers of sambar powder, rasam powder kulambu chilly powder, chicken masala powder chicken 65 masala powder, curry masala powder, garam masala powder, fish fry masala, biryani masala, mutton masala, fish curry masala, rice bath powder, Leman bath powder, tomato bath powder and sukkumalli powder etc. M/s. Aachi Masala Foods P. Ltd.

Appeal No. Demand Penalty Imposed Personal Penalty On Naveen E/226 & 227/2008 Rs.90,12,680/-

Rs.83,68,681/-

Rs.1,00,000/-

E/336 & 337/2008 Rs.76,72,223/-

Rs.3,00,000/-

Rs.1,00,000/-

E/40288/2014 Rs.46,61,509 Rs.46,61,509 Rs.2,00,000/-

E/40297/2014 Rs.38,63,248/-

Rs.38,63,248/-

E/40298/2014 Rs.44,05,930/-

Rs.44,05,930/-

Rs.2,00,000/-

E/40299/2014 Rs.24,05,937/-

Rs.24,05,937/-

E/40300/2014 Rs.40,05,040/-

Rs.40,05,040/-

III. M/s. Maami Foods P. Ltd.

Meat masala, sambar masala, Biriyani masala, rasam powder, pickle masala, vegetable masala, kulambu masala, thandoori masala, pav bhajji masala, garam masala, channa masala, chat masala, and kabab masala etc. M/s. Maami Foods P. Ltd.

Appeal No. Demand Penalty Imposed Personal Penalty E/353 & 354/2011 Rs.54,07,127/- + Rs.14,08,599/-

Rs.53,98,404/-

Rs.5,00,000/-

E/40380 & 40381/2014354/2011 Rs.20,49,657/- + Rs.31,94,830/-

Rs.10,00,000/-

IV. M/s. Avitaa Food Products They are the manufacturers of Turmeric powder, chilly powder, coriander powder, pepper powder, jeera powder, sambar powder, rasam powder, idly chilly powder, garam masala, biryani masala, puliyodharai powder, pav bhaji masala, vathal kulambu powder, lemon rice powder etc., M/s. Avitaa Food Products Appeal No. Demand Penalty Imposed Personal Penalty E/683/2009 Rs.1,28,21,049/-

Rs.1,28,21,049/-

Rs.3,00,000/-

Rs.4,25,001/-

E/299 & 300/2011 Rs.1,89,556/-

Rs.1,89,556/-

Rs.1,58,235/-

V. M/s. Arumuga Consumer Care They are the manufacturers of sambar powder, rasam powder, kulampu chilli powder, garam masala, curry masala, mutton masala, chicken masala, chilli chicken/65 masala, dhall powder, idly chilli powder, puliyodharai powder, bajji bonda mix, lemon rice powder, egg kuruma masala etc., M/s. Avitaa Food Products Appeal No. Demand Penalty Imposed Personal Penalty E/42108/2013 Rs.1,67,506/-

Rs.1,67,506/-

E/40992/2014 Rs.2,15,483 Rs.2,15,483

3. All these batch of appeals were extensively heard on 21.1.2015, 5.6.2015 and 10.6.2015 and the Ld. Counsel of each appellant submitted their arguments on the above dates.

5. Shri N. Venkataraman, Sr. Counsel appearing on behalf of M/s. Eastern Condiments Pvt. Ltd. (Appeal No. E/709/2009) led the arguments first and also submitted written synopsis. He submits that they are manufacturing 21 items of various masalas which are nothing but mixture of spices covered under Chapter 9. That the entire issue stands covered by the decision of the Honble High Court of Madras in the case of P.C. Duraisamy Vs. CCE in 2002 (140) ELT 77 (Mad.) and the Division Bench decision of the Honble High Court of Madras in the case of Sakthi Masala Pvt. Ltd. 2008 (229) ELT 34 (Mad.) He also submits that the Mumbai Bench of the Tribunal in the case of NarendraKumar & Co. Vs. CCE reported as 2008 (232) ELT 866 has discussed the issue at length what is spices classifiable under Chapter 9 and what is mixed condiments classifiable under Chapter 2103. He submits that the products prepared by the appellants are not ready mix (instant) products but they are mixture of combination of spices which will aid in the preparation of food. He relied on Chapter Note 1 of chapter 9 and the Supplementary Note of Chapter 9. He drew the attention of the Bench to pages 75 to 77 of the paper book wherein the ingredients of each items were listed out and it clearly shows that these are only mixture of spices. He drew the attention of the Bench to pages 60 to 62 of the Order-in-Original wherein the adjudicating authority in contrary to their submissions concluded as preparations and held that they lost their essential character of spices within the meaning of Chapter 9. and this finding is without any evidence and without any test report. He submits that in their products 97% of contents are spices. As per Chapter 9, mere addition of other ingredient does not take away the essential character of spices. He further submits that Chapter 21 covers only miscellaneous edible preparations not elsewhere specified in the Tariff. He submits that Chapter Heading 2103 covers only such edible preparations which are ready to eat and do not require any preparations. He further submits that the above decisions of the jurisdictional Honble High Court of Madras have attained finality and it is binding on the authorities and Tribunal. He also produced a copy of RTI query received from jurisdictional Assistant Commissioner of Erode confirming in writing that the decision of the Honble High Court has been accepted. He also submitted a RTI reply from Mumbai Commissionerate wherein the jurisdictional Commissioner has confirmed in writing vide letter dated 3.1.2012, that the Tribunals decision in the case of NarendraKumar (supra) has been accepted by the Department. He also produced various other RTI replies that is from Central Excise, Coimbatore, Erode confirming the classification of the products under Chapter 9.

6. Learned Senior Counsel further submits that in the physical laws there should be uniformity and consistency in the classification of products. He relied on the Boards Circular No. 205/1996 dated 30.4.1996. He relied on the following decisions:-

(a) CCE, Mumbai Vs. Narendrakumar & Co. - 2008 (232) ELT 866

(b) P.C. Duraisamy Vs. Assistant Commissioner of Customs, Central Excise, Erode I - 2002 (140) ELT 77 (Mad.)

(c) Sakthi Masala Pvt. Ltd. Vs. CCE, Salem - 2008 (229) ELT 34 (Mad.)

(d) Damodar J. Malpani Vs. CCE - Malpani 2002 (146) ELT 483 (SC) He also submits that since the issue is only a classification dispute, various Board circulars were issued on the classification of spices and mixed spices, therefore there is no suppression or mis-statement. Accordingly, extended period cannot be invoked.

7. LD. Counsel Shri N. Viswanathan, Advocate, representing M/s. Nazareth Foods Pvt. Ltd. and M/s. Aachi Masala Foods Pvt. Ltd. largely adapted the submissions of Shri N. Venkataraman, learned senior counsel. He submits that M/s. Nazareth Foods Pvt. Ltd. is a manufacturing firm and M/s. Aachi Masala Foods Pvt. Ltd. is a trading firm. He further submits that in the show-cause notice the Department has already allowed all the curry powders and masala powders classified under Chapter 9. The dispute in these appeals is with regard to only 4 products Tamarind Rice Bath powder, Lemon Rice Bath powder, tomato Rice bath powder & chukkumalli powder. Out of the 4 items, Department classified 3 items under 2103 and one item i.e. chukkumalli powder under 2106. He further submits that in the show-cause notice at paragraphs 8.6 and 9.17, the Department admitted that chukkumalli is classified under 09.03. He relied on HSN and also relied on the Boards circular dated 30.4.1996. The Department failed to establish with any evidences to show how the spices no longer retain the essential character so as to fall under Chapter 9 and the onus is on the Department. Whereas, only vague allegations have been made on Chapter Note 1 and Supplementary Note 2 of Chapter 9 are relevant. He further submits that the Department has drawn the samples and also prepared the test memo but same were not tested and relied (page 25). That Commissioner in his order at para 8.1.3 at page 47 held that since these are mixture of spices, testing is not required. He further submits that they got the samples tested at a laboratory accredited by NABL on their own and the test report confirms that the products contained significant amount of spices. He relied on 3 Board circular dated 15.4.1996, 30.4.1996 and 30.10.1998. He submits that the none of their products contain any seasoning materials.

8. Regarding chukkumalli powder, he submits that it is essentially a coriander powder which is used to make a drink for relief of cough etc. He also submits that even if chukku malli is admitted as a drink they are exempted under Notification No. 3/2006 dated 1.3.2006 (Sl. No. 29). He relied on the decisions relied by the learned senior counsel. He also relied on denovo Order-in-Original dated 08.08.2000 passed by the Commissioner of Central Excise, Bangalore and the Tribunal in the case of MTR Distributors Pvt. Ltd. Vs. CCE, Bangalore 1999 (113) ELT 708, wherein he classified the goods under Chapter 9 as mixed spices. He also pleaded that since there is no suppression of facts larger period cannot be invoked.

9. Shri M. Srinivasa, learned Counsel appearing for M/s. Maami Foods Pvt. Ltd. submitted a list of 27 items manufactured by them and there is no dispute in respect of Sl. Nos. 1 to 5 and they are contesting the classification in respect of Sl. Nos. 6 to 23, 25 and 26 in these appeals they are not contesting the demand in respect of Sl. Nos. 24 (Bajji Bonda mix) and Sl. No. 27 (Payasam Mix). He referred para 12, 20 of the show-cause notice and submits that the allegations are contrary to Chapter Note 1 of Chapter 9. He submits that the only allegation of the department is that after mixing up the spices they lose their identity and the essential characteristics. Except this allegation no other material evidence put forth by Revenue. No samples were drawn nor any test carried out. Therefore, the burden of proof lies on the Department to establish that the products have lost their essential characteristics of spices. He also adopted the submissions made by learned Senior Counsel and the decisions relied by them. He drew attention to the definition of modern cookery for teaching and trade (page 56 & 57 of paper book) and as per this, all these curry powders are nothing but spices. He also produced a copy of Order-in-Original No. 2/2000 dated 8.8.2000 passed by the Commissioner of Central Excise, Bangalore and submits that, after remand by the Tribunal, the Commissioner in his denovo order classified the products under Chapter 9 and dropped the proceedings. Therefore, he submits that classification under 9 has been accepted in Bangalore Commissionerate. He submits that there is no suppression of facts and extended time limit will not apply as they were under bonafide belief that spices are covered under Chapter 9.

10. The learned counsel Shri S. Murugappan representing for Avitaa Foods Products Ltd. and submits that there are four more appeals pending and they are not listed today. He adopts the submission discussed by other counsels and are applicable in their case also. He relied on page 92 of show-cause and submits that there is no dispute on the products contained in para 4.1 which are purely spices. The dispute regarding the list of 32 items mentioned in 4.2 of the show-cause notice (page 92 of the paper book) are under dispute where the department has classified under Chaper 21039040. He relied on Chapter Note 1 of Chapter 9 which are relevant for classification of spices. As per Note 1(b) of Chapter 9 even the product having the mixtures of a heading falling under other chapters are classified under Chapter 9 as long as it retains the essential characteristics. He further submitted that there are two criteria applicable for classifying under Chapter 21. Firstly, addition of seasoning material which does not fall under Chapter 9 and secondly, after such addition, the product should lose its essential characteristics. Whereas, in the present case, there is no addition of any other seasonings. The departments only finding is that these are mixed condiments. It is the obligation of the Department to prove with evidence that the goods are classifiable under 2103. Since the appellants were under the bonafide belief and the goods are covered under Chapter 9 chargeable to nil rate of duty, the onus is on the department to prove otherwise.

11. He relied on paras 8.2 and 8.3 of the show-cause notice which are only general statement. No specific allegation has been made. He also submits that the decision of the Honble Supreme Court in the case of AP Products Vs. State of Andhra Pradesh 2007 (214) ELT 485 (SC) relied by the Department will not apply to the facts of the present appeals. He also relied on the Boards Circular dated 30.4.1996. He pleads that the demand is hit by time bar and the extended period is not invocable as there is no suppression of facts. He relied on the following decisions:-

(a) Coastal Energy Pvt. Ltd. Vs. CCE, Guntur - 2014 (310) ELT 97

(b) Padmini Products Vs. CCE - 1989 (43) ELT 195 (SC) He also submits that the Department has invoked Section 11AC even for the second show-cause notice dated 31.3.2009. No Section 11 AC penalty is imposable.

12. Learned AR Shri Rammohan Rao, JC for Revenue, reiterates the findings of the adjudicating authorities. He summarized all the issues involved in the adjudication orders and also submitted a compilation of Board Circular, HSN and the decisions. He submits that the appellants main allegations are of two fold. Firstly, all the appellants submitted that there is no uniformity in the classification of the products and the second allegation is that the Department has not proved with evidence for classifying the goods under 2103.

13. The learned AR submitted his arguments first on the applicability of Board circular and second on classification. He referred the Boards circular No. 205/96 dated 30.4.1996, and submits that the products can be classified either under Chapter 9 or under Chapter 2103. Para 2, 3 and 4 of the circular clearly states that the products which have predominant mixture of spices/condiments / seasonings and are used as such or in the making of food preparations would merit classification under specific entry of spices under Chapter 9 or heading 2103 of Central Excise Tariff Act, 1985. He submits that the Boards circular has not given any categorical clarification that these products are classifiable under Chapter 9 and the issue is wide open. He submits that the Tribunals decision in the case of Narendra Kumar (supra) has not correctly examined the manner conveyed by the Boards circular and the Tribunal has taken a view that Board has categorically ruled that these products are classifiable under Chapter 9 but it is not so. In the above case, the department relied on the test report which Tribunal did not appreciate. Therefore, the Tribunals decision is distinguishable. He relied on the decision of Honble Supreme Court in the case of Srikumar Agencies Vs. CCE reported in 2008 (232) ELT 577 (SC) wherein the Honble Supreme Court held that any circular or any decision should not be relied without discussing the similarity of facts. He further submits that there is no estoppel in physical matters and since the circular never conveyed any decision, it is left to Tribunal to decide the issue afresh on merits without referring to any circular. He relied on the decisions in the case of McGaw Ravindra laboratories (India) Ltd. Vs. Union of India 1992 (60) ELT 71 and Orissa Cement Ltd. Vs. Superintendent, Customs and Central Excise - 1992 (61) ELT 256 (Ori). The decision of the Honble High Court of Madras relied by the appellants are purely masalas and there is no dispute on that. The Honble High Court has decided the issue based on the circular.

14. On the classification issue LD. AR submits that there is a thin line on what is spices and what is condiments. Spices are classifiable under Chapter 9, whereas, condiments and seasonings under chapter 2103. He argued that the classification of goods under Chapter 9 the headings are in sequentially arranged from raw material form to powder form or a mixture of two or more spices falling under the same chapter. He relied on HSN Explanatory Note, where the product of mixtures, of spices added with other mixtures is only for the purpose of colouring, preserving or base material. A mixture is a simplicitor whereas in the present cases, addition of dhal, rice, asaphoteda and tamarind and other materials clearly makes it preparations and it attains a separate identity as sambar powder in the parlance. He further submits that the essentiality of the product is to be addressed in terms of the functionality, predominance use, test of substitution and a popular understanding of the product by the Trade/ consumer. Therefore, as per the popular usage, it is identified as sambar powder and not as spices. Once the spices are grounded and mixed with other items, the spices loss its originality. He submits that as per the decision of the Honble Supreme Court in the case of Milak Brothers Vs. UOI -1991 (51) ELT 204 (S.C., each case has to be examined on the facts. He also submits that the appellants contention on the predominance is not the determining factor and it cannot be the main issue and it can only be taken as a consideration. He relied on the following case laws:-

(a) Nestle India Ltd. Vs. CCE, Chandigarh II - 2011 (270) ELT 575

(b) Kesarwani Zarda Bhandar Vs. State of UP - 2008 (227) ELT 337 (SC)

(c) Deputy Commissioner of Sales Tax Vs. Rani Food Products - 1988 68 STC 446 (Ker.)

(d) Commercial Tax Officer Vs. Jalani Enterprises - (2011) 4 SCC 386

(e) CCE Vs. Parle Exports (P) Ltd. - 1988 (38) ELT 741

(f) McGaw Ravindra laboratories (India) Ltd. Vs. Union of India - 1992 (60) ELT 71 (Guj.)

(g) CCE, New Delhi Vs. Connaught Plaza Restaurant (P) Ltd. - 2012 (286) ELT 321 (SC)

15. He submits that extended period has been rightly invoked. Regarding the test, he submits that since all the items are mixtures the Department has discharged the burden of proof by relying on the contents of percentage of each spices based on the literature produced by the appellants.

16. Learned counsels appearing for Nazareth Foods Pvt. Ltd. and Aachi Masala Foods Pvt. Ltd. in their counter submitted that Tribunals decision in the case of Narendra Kumar (supra) has not only relied the Boards circular, but they have applied principles of classification and dealt the issues independently that essentiality of the character means, even after the mixing of all spices together, it remains only as spices, it has not lost the essential character and it is not other way what the Department is trying to interpret. It is only a predominance of spices and it does not affect the essential characteristics of the mixture as a spice, whereas the Department chooses to interpret that each spices loses its essential character. Relied on the Supplementary Note 3 of Chapter 9, which was specifically introduced only for this purpose where the word masala has been disputed. The Chapter Note also clearly says, a mixture of product of any other chapter. He submits that the essential quality for classifying under Chapter 2103 should have a mixed seasoning and mixed condiments whereas it is absent in their products. They also submitted uniformity in taxation and judicial discipline should be maintained where the High Court and other Benches of the Tribunal have already decided the issue.

17. We have carefully examined the submissions made by both the sides and also perused the records. The issue to be decided in this case is whether the products namely Sambar powder, rasam powder, garam masala, chana masala and various other curry powders manufactured by the appellants are classifiable under chapter heading 0904 to 0910 as spices or under chapter heading 2103.9040. All the appellants are manufacturers of various masala powders only they have given in different names.

(i) The first appellant Eastern Condiments Pvt. Ltd. in appeal No. E/709/2009 are manufacturer of 13 items viz., Meat masala, sambar masala, Biriyani masala, rasam powder etc, and the period involved is April 2004 to March 2009.

(ii) The second appellant M/s. Aachi Masala Foods (P) Ltd. in appeal E/226/2008, E/337/2008 and E/40288/2014, disputed only four items viz., Rice bath powder, Leman bath powder, tomato bath powder and sukkumalli powder and the period involved is 2002 to march 2010.

(iii) In the case of M/s. Maami Foods Pvt. Ltd. in appeal E/353 & 354/2010 and E/40380 & E/40381/2014, they are manufacturers of 22 items the items under dispute are viz., Meat masala, sambar masala, Biriyani masala, rasam powder, pickle masala, vegetable masala etc, and the period involved is January 2004 to July 2008. They are not contesting the classification of Bajji bonda and payasam mix (at sl.No. 24 & 27).

(iv) The appellant M/s. Avitaa Food Products in appeals E/638, E/299 & 300/2011 are the manufacturers of 36 items by and large same as the above appellants. M/s. Arumuga Consumer Care are manufacturer of 14 items (same as above)

18. On perusal of records, we find that There is no dispute on the classification of pure powdered spices ie. Turmeric powder, chilli powder etc., and the dispute is only on the mixtures of one or more spices with or without added materials. The appellants contended that these products are various spices, though differently named, are classifiable under CTH 0904.9010 of chapter 9 of CETA and heavily relied on Boards Circular, test reports, expert opinions, HSN explanatory notes and various citations of High Courts and Tribunals decisions etc. On the other hand, the Revenue contended that these products are rightly classifiable under chapter 2103 as mixed condiments and mixed seasonings and heavily placed their submissions that classification should be based on the usage of the product and contended that once the spices are mixed, they loose their identity and the question of predominance of the processing of spices does not arise and also the revenues view that the products are commonly understood by the trader/consumer, are identified in the market as sambar powder, curry powder, masala power etc. and not as spice.

19. As regards the processes of manufacture of various mixtures of spices and its contents both the sides have no dispute. Those products are commonly called as masala powders, curry powders etc., in bulk or in retail packs of various quantity. The appellants receive various spices viz., chilly, turmeric and other edible ingredients which are roasted, cooled, pulverized and blended and packed. These are marketed in different names either sambar powder, rasam powder, curry masala or rice bath powder etc. We also find that these masala powders do contain other edible items such as salt, rice powder, dal powder and preservatives etc. These are not ready to use item i.e. instant mix but it is to be added while preparing the food. The relevant chapter note 1 of chapter 9 of CET is reproduced is as under :

1.?Mixtures of the products of headings Nos. 09.04 to 09.10 are to be classified as follows :

(a) Mixtures of two or more of the products of the same heading are to be classified in that headings;

(b) Mixtures of two or more of the products of different headings are to be classified in heading No. 09.10.

The addition of other substances to the products of headings Nos. 09.04 to 09.10 (or to the mixtures referred to in paragraphs (a) or (b) above) shall not affect their classification provided the resulting mixtures retain the essential character of the goods of those headings. Otherwise such mixtures are not classified in this Chapter; those constituting mixed condiments of mixed seasonings are classified in heading No. 21.03.

Supplementary Note (3) reads as under.

3. The addition of other substances to spices shall not affect their inclusion in spices provided the resulting mixtures retain the essential character of spices and spices also include products commonly known as masalas.

HSN Explanatory note for chapter 9 which is reproduced as under:-

1.?Mixtures of the products of headings Nos. 09.04 to 09.10 are to be classified as follows :

(a) Mixtures of two or more of the products of the same heading are to be classified in that headings;

(b) Mixtures of two or more of the products of different headings are to be classified in heading No. 09.10.

These products may be whole or in crushed or powdered form General.

As regards the classification of mixtures of products of headings 09.04 to 09.10 see Note 1 to this Chapter. Under the provisions of this Note, the addition of other substances to the products of headings 09.04 to 09.10 (or to the mixtures referred to in para (a) or (b) of the Note) shall not affect their classification provided the resulting mixtures retain the essential character of the goods falling in those headings.

This applies in particular, to spices and mixed spices containing added:

(a) Diluents (spreader bases ) added to facilitate measuring out of the spices and their distribution in the food preparation (cereal flour, ground rusk, dextrose, etc)

(b) Food colourings (e.g. xantholpyll)

(c) Products added to intensify or enhance the flavor of the spices (synergetics), such as sodium glutamate

(d) Substances such as salt or chemical antioxidants added, usually in small quantity, to preserve the products and prolong their flavouring powers.

From the above chapter notes and HSN explanatory notes it is evident that mixtures of spices are classifiable under chapter either 0904 to 0910. The supplementary note to chapter 9 of CETA make it more clear that addition of other substances to the spices shall not affect the original characteristic of any spices. The HSN explanatory note to Chapter 9 clearly explains the classification of mixture or products of headings 0904 to 0910 and confirms that addition of other substances shall not affect their classification provided the resulting mixture retain the essential character of the goods falling in those headings. HSN explanatory note stipulates that the edible materials, dilutents, food colourings, salt or chemical antioxidants are only added in the mixtures as a base enhancing the colour or flavor or to preserve.

20. Further, we find the Chapter 21 of CET covers miscellaneous edible preparations and the chapter note one to chapter 21 excludes spices and other products of heading 0904 to 0910. Heading 2103 covers sauces and preparations therefor, mixed condiments and mixed seasonings etc., and chapter heading 2106 covers food preparations not elsewhere specified.

20. Further, it is pertinent to see the definitions of spices as provided under Spices Board Act, 1986. Under Section 2(n) of SB Act spices means the spices specified in the schedule. In the schedule to Section 2(n), 52 items are listed eg. as chilly, ginger, turmeric, coriander etc. and the note to the schedule it is clarified that spices in any form are covered under spices including curry powders, spice oil, oleoresins and other mixtures where spice content is predominant. A combined reading of chapter note one and supplementary note 3 read with HSN explanatory note it is evident that mixtures of various spices with or without addition of other items are classifiable under chapter 0904 to 0910 as it retains its essential character. On perusal of the ingredients and the test reports of various masalas, we find that the percentage of spices content is 95% to 96% and the remaining are other materials. Further, we find that Boards Circular dated 15.04.1996 and 30.04.96 also clarified on the issue of classification of spices of various food mixture known as masalas and condiments falling under chapter 9 and chapter 2103. In this regard the Tribunals Mumbai Co-ordinate Bench in the case of CCE Vs. Narendra Kumar & CO. 2008 (232) ELT 866 (Tri.-Mum.) on identical issue of classification of masala powders allowed the appeal and discussed the Boards Circulars and distinguished the Honble Andhra Pradesh High Court decision in the case of AP products. The relevant portion of the Tribunal decision is reproduced as under:-

9.?On careful perusal of the cartons of the products in question we find that these products are mixtures of spices along with other ingredients. The ingredients in the products in question are combination of the spices and some more ingredients. It is seen that in addition to spices, the ingredients include mainly asafoedita, rock salt, dry mango etc. It is the submission of the learned Jt. CDR that by addition of these ingredients the essential character of the spices is not retained. We find that this proposition of the learned Jt. CDR is without any evidence. It is not brought on records that by addition of these ingredients the essential character of spices is not retained. It is seen that the revenue has relied upon the report of the Dy chief chemist, which is in itself not very clear. We find that the respondent during the hearing and the proceedings before the adjudicating authority, has always mentioned that the products in question had various different spices in powder form up to 96% of the total ingredients and other ingredients formed only 4% to 5% of the total ingredients. We find that the revenue has not disputed these contentions with any contrary evidence and hence the submissions of the learned Jt. CDR that the respondent has not submitted the percentages of the ingredients to arrive at the essential character of the products in question seems to be totally mis-placed. If the 96% of the total ingredients are spices then by mere addition of some quantity of other ingredients may not be sufficient to arrive at the conclusion, that by addition of these other ingredients the mixture of spices has not retained their essential character. We find that the reliance placed by the learned counsel on the CBEC Circular No. 427/60/98-CX, dated 30-10-98 is correct. CBEC in the said circular was concerned with the correct classification of compounded asafoedita, which contained 85% of other ingredients like wheat flour and edible gum, despite this, it was directed that compounded asafoedita will be asafoedita, as the essential character is of asafoedita and not wheat flour or edible gum. The analogy would apply in this case also as it is undisputed that 95% to 96% of the ingredients of the products in question are spices. Learned Jt. CDR placed heavy reliance on the decision of the Honble Supreme Court in the case of A.P. Products (supra) to submit that grinding and mixing of various spices and condiments in certain proportion, the ingredients lose their identity/character and a new product separately known in the market emerges i.e. the products in question are mixed seasonings. We find that in the case A.P. Products (supra) the Apex court was seized with a fact, which was totally different than the facts in this case. In that case the question before the Apex court was whether the resultant product would get covered under a specific entry of the schedule to the AP Sales Tax Act. It is also seen that Apex court was deciding the issue specifically as regards the inclusion in the schedule to the AP sales tax act. In our considered view the ratio laid down by the Honble Supreme Court was in respect of the facts and circumstances, of the case before them and may not be applicable in this case.

10.?It is a settled law that in cases of classification chapter notes of HSN can be considered as guide for arriving at a correct classification. The chapter notes of chapter 9 of HSN read as under :

1.?Mixtures of the products of headings Nos. 09.04 to 09.10 are to be classified as follows :

(a) Mixtures of two or more of the products of the same heading are to be classified in that headings;

(b) Mixtures of two or more of the products of different headings are to be classified in heading No. 09.10.

2.?This Chapter does not cover Cubed pepper (Piper cubeba) or other products of heading no. 12.11.

It can be noticed that chapter note no. 3 of chapter 9 of CETA is almost same but for the inclusion of masala in the chapter heading no. 0903. This seems to be a marked deviation for the purposes of the classification in the Indian context. It is a common knowledge that the Indian cuisine includes mixtures of various spices that are commonly known as Masala The inclusive portion would cover in its ambit the products in question in this case as there is no contrary evidence led by revenue.

11.?We further find that the Central Board of Excise and Customs vide Circular No. 205/39/96-CX, dt. 30-4-1996 were clearing doubts regarding the classification of Indian traditional convenience food mixes, masalas and condiments we may reproduced the same.

Board has received representations from Indian Food Industries Association and others seeking clarification as regards the classification of various Indian traditional convenience food mixes, masalas, spices and condiments such as puliyougare powder, vangibath mix, instant sarnbar mix, vangibath powder, sambar powder, instant bisibelebath, rasam powder, bisibelebath masala, mix spiced chutney powder, curry powder, pickle masala, garam masala etc.

2.?From the reports received from the Commissionerates, it is observed that while in some places the products in question are being classified as either spices of Chapter 9 of CET or as Mixed Condiments and mixed seasonings of Heading 21.03 of CET, in others the same products are being classified under Heading 2108.90 as edible preparations not elsewhere specified or included. In the latter case, Chapter Notes 9(b) & 9(c) of Chapter 21 are being relied upon for classifying these products under the subheading 2108.90. Trade interests have, however, argued that these products are merely additives for different food items and not readily consumable products through the simple processes of cooking, frying, boiling or adding with water, oil or milk. Hence it is claimed that the products in question cannot be classified under sub-heading 2108.90 of CET.

3.?The matter has been examined. Spices are specifically covered under Chapter 9 of Central Excise Tariff and mixed condiments and mixed seasonings under Heading 21.03 of Central Excise Tariff. Heading 21.08 of CET on the other hand is a residuary entry which refers to edible preparations not elsewhere specified or included. While there are no definitions available for spices and mixed condiments and mixed seasonings in the Central Excise Tariff, the Explanatory Notes to the HSN give the following description of these products.

Spices Spices i.e. a group of vegatable products (including seeds etc.), rich in essential oils and aromatic principles and which because of their characteristic taste are mainly used as condiments. Spices (including mixed spices) containing added substances of other Chapters, but themselves having flavouring or seasoning properties, remain in this Chapter provided the added quantity does not affect the essential character of the mixture as a spice, (Vol.1 Page 61).

Condiments /Seasonings Mixed condiments and mixed seasonings containing spices differ from spices and mixed spices of Headings 09.04 to 09.10 in that they also contain one or more flavouring or seasoning substances of Chapters other than Chapter-9, in such proportions that the mixture has no longer the essential character of a spice within the meaning of Chapter-9 (Vol. 1 Page 158).

3.2?While the Explanatory Notes in HSN distinguish between spices on the one hand and mixed condiments and mixed seasonings on the other, the English Dictionary meanings and statutory, bodies dealing in quality specifications of spices, condiments and seasonings often use these words interchangeably. What is however emphasised in the literature on the subject is that the essential character of these substances is in their function, viz., to add flavour, aroma and pungency to various food preparations.

3.3?Chapter Notes 9(b) and 9(c) of Chapter 21 of CET no doubt give an indication of the type of preparations which are intended to be included in Heading 21.08 of CET. However, it must be remembered that Heading 21.08 is a residuary entry in Chapter 21 and the Rules for the interpretation of the Schedule require that the heading which provides the most specific description shall be preferred to headings providing a more general description. Further, Heading 21 in HSN excludes spices of Chapter 9.

4.?Consequently, products which are predominantly mixtures of spices/condiments/seasonings and which are used as such or in the making of food preparations mainly for their aromatic, flavouring or seasoning properties would merit classification under the specific entry of spices in Chapter 9 or Heading 21.03 of CET. However, products which in addition to spices, flavouring and seasoning substances also contain, other foodstuffs in such quantity that the products as such or after processing are capable of being used as food preparations for human consumption in their own right will go out of Chapter 9 or Heading 21.03 of CET and merit classification in the residuary Heading 21.08 provided they are not covered or included in any other heading of CET.

4.2?Viewed in the context, products like sambar powder, rasam powder, puliyogare mix or powder, vanghibhath mix or powder consisting or mainly spices and required to be added to cooked dal or cooked rice mainly for spicing, flavouring or seasoning would appear to merit classification as spices or mixed condiments and seasonings. On the other hand, products like instant sambar mix, instant rasam mix, instant spiced bhath mix (Bisibelebath) or instant Kharabhath mix consisting of dal or rice flakes or sooji along with spices and other substances and which can be made up into food preparations by simply mixing and boiling/cooking in water would merit classification as miscellaneous edible preparations of Heading 2108 of Central Excise Tariff.

5.?In view of the above, Board desires that classification of each product be decided on merit having regard to discussions hereinabove.

It can be noticed from the above reproduced Circular of CBEC and more specifically Paragraph 4 & 5 that the classification of the spices would fall under Chapter 9. Even the understanding of the Central Board of Excise & Customs is that addition of any other ingredients to said mixture of spices should be such, a quantity, as such or after processing, are capable of being used as food preparation for human consumption, in their own right will go out of Chapter 9 and merit classification in the residuary heading 21.089. It is to be noted that in the case before us, the products in question there is no evidence that, these products are capable of being used as food preparation for human consumption in their own right. It is well settled law that if Revenue wants to reclassify the products, then it has to lead evidence. Assessee cannot be asked to prove the negative.

12.?We find that the Tribunal in the case of Commissioner of Central Excise Commissioner of Central Ex. & Cus., Guntur v. Crane Betel Nut Powder Works, as reported at 2007 (208) E.L.T. 376 (Tri. Bang.) was seized with an identical issue of classification whether Mouth freshner will get covered under Chapter Heading No.09.03 of Central Excise Tariff or under Chapter 21 of the Central Excise Tariff Act. The Bench held as under :-

We have carefully considered the submissions and have perused both the orders. The finding given by the Commissioner is very exhaustive. He has analyzed every aspect of the matter and also in the light of the HSN Explanatory notes. The Revenue wants the product to be classified under Chapter Heading 21.03, which description deals only with sauces and ketchups. The item does not fit into the said items described in Chapter Heading 21. The learned JDR relied on the judgment rendered in the case of MTR Food Products v. CCE, Bangalore - 2000 (118) E.L.T. 392 (T), which deals with Sambhar mix/Rasam mix, which has been held to be classifiable under Chapter Heading 21.04. These items are not consumed directly. They are required to be used for cooking purposes, as in the case of items falling under Chapter Heading 21.04. Therefore, this judgment is clearly distinguishable. Even in terms of the Apex Court judgment rendered in the case of Shree Baidyanath (supra), the classification has to be done in the manner in which the goods are understood in the market and popularly known as. In that light, the item has to be considered only as Spices as held by the noted Boards Circular referred to by the Commissioner.

13.?It is settled law that the classification of a product is decided on the question of market understanding of the product. The respondents herein had lead evidences before the lower authorities as regards the market understanding of the product. The respondent had produced before the lower authority, certificates given by reputed consumers of that products and of Institute of Hotel Management, Catering Technology & Applied Nutrition, so as to indicate that the masalas manufactured by the respondents, are of best quality spices and given the flavor of the spices it gives a perfect fragrant and taste to the food. This evidences are not rebutted by the Revenue even today. We find that this provisions of law is now squarely covered by the decision of the Honble Supreme Court in the case of Union of India v. Garware Nylons Ltd. (S.C.) [1996 (87) E.L.T. 12 (S.C.)] wherein their Lordships were concerned with the classification of goods. Their Lordships held as under :-

In our view, the conclusion reached by the High Court is fully in accord with the decisions of this Court and the same is justified in law. The burden of proof is on the taxing authorities to show that the particular case or item in question, is taxable in the manner claimed by them. Mere assertion in that regard is of no avail. It has been held by this Court that there should be material to enter appropriate finding in that regard and the material may be either oral or documentary. It is for the taxing authority to lay evidence in that behalf even before the first adjudicating authority. Especially in a case as this, where the claim of the assessee is borne out by the trade inquiries received by them and also the affidavits filed by persons dealing with the subject matter, a heavy burden lay upon the revenue to disprove the said materials by adducing proper evidence. Unfortunately, no such attempt was made. As stated, the evidence led in this case conclusively goes to show that Nylon Twine manufactured by the assessee has been treated as a kind of Nylon Yarn. Hence, it is to be classified under Item 18 of the Act. The Revenue has failed to establish the contrary. We would do well to remember the guidelines laid down by this Court in Dunlop India Ltd. v. Union of India [1983 (13) E.L.T. 1566 (S.C.) = (AIR 1977 SC 597 - at page 607], institution, wherein it was stated :-

............when an article has, by all standards, a reasonable claim to be classified under an enumerated item in the Tariff Schedule, it will be against the very principle of classification to deny it the parentage and consign it to an orphanage of the residuary clause. (Emphasis supplied)

14.?It is also to be noted that the Revenues Endeavour in this case is to seek classification of the products in question under Chapter heading No. 21.03/21.08. The main plank of arguments of the Revenue is that these are all mixed condiments and mixed seasoning. In the matter of taxability of the product under the Central Excise Tariff Act, the act being same all over India, uniformity in classification is a must. The departments understanding of the product in question is clearly borne out from Circular dt. 30-4-1996 (as reproduced at Paragraph 11 hereinabove) the understanding of the department in the current case also seems to be an identical as of the Board. Our attention was drawn by the ld. Counsel, to the classification of the product in question in various Commissionerates. The respondents under the RTI Act, sought information of the identical products, as is manufactured by them, from various Commissionerates. We find that the various Commissionerates spread all over India, had clearly spelt out, that the products in question are classified under Chapter 09 and in some of the Commissionerates, the assesses had not taken out the Central Excise registration certificate also. We find from the chart produced by the ld. Counsel, the ingredients of the products in question are identical to the products which are manufactured by other assessee situated in different Commissionerates. The question of uniformity taxation is of prime importance. We find that the Honble Supreme Court in the case of Damodar J. Malpani v. Collector of Central Excise as reported at [2002 (146) E.L.T. 483 (S.C.)]

16.?As regards the other products like Rasam Powder, Chaat Masala, Tea Masala, we find that the reasoning given by us in respect of all other products in question as indicated in the above paragraphs would apply squarely. Ld. Jt. CDR submitted that classification of Rasam Powder would be covered by the decision of Tribunal in the case of MTR Food Products - 2000 (118) E.L.T. 392 (Tri.). We find that the products in question in this case is different than the product in the case of MTR Food Products (Supra). In the case MTR Foods the products was Rasam Mix itself which was to be just added to boiling water, while in the case before us the Rasam Powder is to be added to complete prepared Rasam. Hence we are of the considered view that the decision of the Tribunal in the case of MTR Products (supra) may not apply to the facts and circumstances of the case before us. Accordingly, we are of the considered opinion that the impugned order of the adjudicating authority is correct and does not suffer from any infirmity in respect of the classification of the products, except for jiralu.

17.?The impugned order is upheld to the extent of all other products and as regards classification of product Jiralu we remand the matter back to the adjudicating authority for limited purpose of considering the evidences and then arriving at a conclusion. Both the appeals are disposed off accordingly. The above Tribunal decision squarely applicable to the facts of the present case. We also find from the RTI Reply , the Mumbai Commissionerate had confirmed that the said Tribunal order has been accepted and no appeal has been filed by the Revenue.

21. Further, we find that the jurisdictional Honble High Court of Madras in the case P.C. Duraisamy Vs. CCE (supra) and the Division Bench decision of the Honble High Court of Madras in the case of Sakthi Masala Pvt. Ltd. (supra) squashed the SCN issued to the appellants on the identical issue of classification of various masala powder. The relevant portion of the judgment of the Honble High Court in the case of P.C. Duraisamy Vs. CCE (supra) is reproduced as under:-

5.?In the counter affidavit, it is also further submitted that -

in the meantime, the Ministry of Finance, Department of Revenue in their letter F. No. 16/4/95-CXI, dated 30-4-1996 (Circular No. 205/39/96-CX) have given certain instructions on the classification of Spices. According to the instructions, products like Sambar Powder, Rasam Powder, Puliyogare Mix or Powder, Vaeghibath Mix or Powder consisting mainly of spices and required to be added to cooked dal or cooked rice mainly for spicing, flavouring or seasoning would appear to merit classification as spices under sub-heading No. 0903.00 attracting NIL rate of duty. On the other hand, products like instant Sambar Mix, Instant Rasam Mix, Instant spiced bhath Mix, (Bisibelebath) or Instant Kharabhath Mix consisting of Dal or Rice flakes or Sooji along with spices and other substances and which can be made up into preparations by simply mixing and boiling/cooking in water would merit classification as miscellaneous edible preparations under sub-heading No. 2108.90 of Central Excise Tariff attracting 20% duty.

I submit that regarding Paras 5 and 6 it is submitted that as per the instructions given in the Ministrys letter F. No. 16/4/95-CX, dated 30-4-1996 (Circular No. 205/39/96-CX) all the goods manufactured by the petitioner except branded soap-nut powder, branded sundavathal, branded appalam and unbranded Turmeric are classified under sub-heading No. 0903.10 as spices and the same has since been approved.

6.?In the course of hearing of the writ petition the learned Counsels appearing for the respondents vehemently contended that the writ petition is pre-mature and should be dismissed. It is further contended that the petitioner instead of availing alternative remedies should not have approach this court.

7.?It is true that where alternative remedies available, ordinarily the High Court should not entertain the matter under Article 226. Similarly even if the High Court has entertained the writ petition seeking to quash the show cause notice, it is open to the person concerned to file show cause so that the matter can be determined by the appropriate authority. While these cannot be any dispute relating to such well accepted principles, in the present case, in view of the stand taken by the respondent practically accepting the contention of the petitioner, I do not think any useful purpose would be served by directing the petitioner to undergo the process of filing show cause and pursuing the statutory remedies. In view of the stand taken in the counter affidavit itself, the show cause notice so far as it relates to articles included in 0903.00 is quashed. It is however made clear that if there is any other item manufactured by the petitioner not coming within the aforesaid entry, it would be open to the opposite party to proceed in accordance with law. Subject to the aforesaid observation, the writ petition is disposed of without any order as to costs.

The Division Bench of the Honble High Court of Madras in the case of Sakthi Masala Pvt. Ltd. (supra) upheld the judgment of the Single Member Bench rendered above in the case of P.C. Duraisamy Vs. CCE (supra), the relevant portion which is reproduced as under:-

18. Even with regard to the products in question, we are able to find that there is change in English as follows:

      a.   Dhal Rice Powder             -  Dhal Mix
      b.   Chilli Chutney Powder    -   Idly   Dosa Powder
      c.   Tamarind Rice Powder    -   Tamarind   Mix
      d.   Garlic Rice Powder          -   Garlic Mix 
      e.   Lemon Rice Powder        -   Lemon Mix
      f.   Bajji  Bonda Powder       -   Bajji  Mix

19. In view of our above categorical finding that the decision of this Court in W. P. No. 7029 to 1996 , which reached its finality , is binding on both the parties, the present petitioner appellant not being a different entity, the present show- cause notices issued in respect of the first three items above, which were the subject matter in the earlier round of litigation, are nothing but illegal Though, normally, Courts will not interfere at the stage of show cause notice, as has been held by this Court in the earlier round of litigation itself, when the very issuance of show- cause notice is illegal, the question of subjecting the appellant petitioner to reply to the same does not at all arise. When the products have undergone only a change in the English name , the Revenue, only to give a different interpretation to the order of this court in W. P. No. 7029 of 1996, wherein the Revenue has been given liberty to proceed against the appellant petitioner it there is any other item manufactured by the petitioner, not coming within the aforesaid entry 20 . With regard to the other three products namely (1) Garlic Rice Powder, (20 ) Lemon Rice powder and (3) Bajji Bonda powder, we are able to see that they did not figure in the above said writ petition, but the petitioner appellant was issued with Registration Certificate and he filed Classifications under Rule 173B, wherein all the six products under dispute were classified under chapter 9 become final as not questioned or challenged by the Revenue at any point of time. Therefore, having accepted the declaration and RT-12 returns filed by the appellant petitioner, the Revenue cannot now reopen the issue.

21. Therefore, viewing from any angle, we do not find any legality or justification in the show cause notices issued by the Revenue to the appellant petitioner. In fact, such show cause notices are nothing but an attempt made on the part of the Revenue, to nullify an order of this Court and giving different interpretation to the same, which is highly condemnable.

The ratios of the above both judgments of jurisdictional Honble High Court of Madras are squarely applicable to the present case. The products covered in the above High Court Order and the various items manufactured by the appellants in all these appeals are identical in nature except for change in names. The Honble jurisdictional High Court of Madras decisions are binding on the Revenue and the Tribunal. The Revenue relying on the Honble High Court of AP Products and other decisions in the case of MTR Food products are distinguishable and not applicable to the facts of the present case in view of the jurisdictional High Court decision referred above.

22. By respectfully following the judgments of the Honble High Court of Madras above and the Tribunals decision in the case of NarendraKumar & Co., (supra), we hold the products of various masalas manufactured and cleared by the appellants as listed out in the respective OIOs are rightly classifiable under chapter heading 0904 to 0910 and not under chapter 2103.90 of CET.

23. In view of the foregoing discussions, we hold that all the goods i.e. mixtures of spices with other substances (masala powder) manufactured and cleared under various brand names by the appellants,

i) M/s. Eastern Condiments Pvt. Ltd., Aachi Masala Foods Pvt. Ltd., M/s. S. Nazareth Foods Pvt. Ltd., M/s. Avitaa Foods Products, M/s. Arumuga Consumer Care are rightly classifiable under 0910 9100 of CET. The demand of excise duty confirmed in the respective adjudication orders is set aside.

ii. In respect of M/s. Maami Foods Pvt. Ltd., except bajji bonda mix and payasam mix all other goods manufactured by the appellant under various brand name are classifiable under 0910 9100 and the demand of excise duty confirmed is set aside except for those two above items.

iii. Since the classification of foods held under Chapter 0910 9100 the demand itself is set aside, the question of confiscation or imposition of penalty does not arise. Accordingly, the penalty imposed under Section 11A as well as the personal penalty imposed on the appellant are set aside. All the appeals are allowed with consequential relief.

{Proceedings dictated in the Open court and operative order pronounced in the open court) (P.K. CHOUDHARY) (R. PERIASAMI) Judicial Member Tehnical Member Rex/BB 2

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M/S. Eastern Condiments Pvt. Ltd vs Cce, Madurai on 11 June, 2015