UNION OF INDIA Vs. HAMDARD LABORATORIES

JUDGEMENT

(1.) The respondent, M/s. Hamdard (Waqf) Laboratories, is engaged in the business of manufacture and sale of various items including Rooh Afza which is a sweetened non-alcoholic beverage, and the respondent treated it to have been classified under the sub-heading 2201.90 of the Schedule to the Central Excise Tariff Act, 1986 (for short, 'the Tariff Act'), but the Revenue did not accept the classification claimed by the assessee-respondent on the foundation that it was classifiable under the sub-heading 2107.91 of the Tariff Act.

(2.) Because of the cavil relating to classification, steps were taken for recovery of the differential duty and keeping in view the demands made, the respondent-manufacturer started paying the duty as demanded by the concerned authority. Be it stated, the initial adjudicator, that is, the Assistant Commissioner of Central Excise, did not accept the stand of the assessee. The said grievance compelled the respondent to prefer an appeal before the Commissioner (Appeals) who negatived the stand of the assessee. Being grieved the assessee preferred an appeal before the Central, Excise and Service Tax Appellate Tribunal (for short, 'the tribunal'), which, agreed with the view expressed by the fora below and consequently dismissed the appeal.

(3.) The decision rendered by the tribunal, was called in question by the assessee in Civil Appeal No. 7766 of 1995. The two-Judge Bench in Hamdard (Wakf) Laboratories vs. Collector of Central Excise, Meerut, 1999 6 SCC 617 adverted to the issue of classification pertaining to the product, namely, Sharbat Rooh Afza and posed the question whether the said "Sharbat" was within the tariff heading 2201.90 as contended by the assessee or under heading 2107.91 as the excise authorities would maintain and after adverting to various aspects, accepted the stand of the assessee that it is a non-alcoholic beverage and repelled the stand of the Revenue and resultantly allowed the appeal.