DENAJEE SANSTHAN Vs. COMMISSIONER OF CENTRAL EXCISE, MEERUT

JUDGEMENT

(1.) The appellant is a charitable society registered under the Societies Registration Act and is also registered under the U.P. Khadi Gramodyog Board. The appellant also claims to be registered as a small scale unit and, one of its activities is, manufacturing of Satritha Herbal Shampoo and Neem Shampoo for supply to the Khadi and village industry. According to the appellant, the shampoo manufactured by them is eligible for exemption of duty as per Notification No.140/85-CE dated 5th May, 1983 as amended from time to time. On the other hand, the Central Excise department was classifying the said shampoo under Tariff Chapter sub-heading No.3305.99, Chapter 33 of the Central Excise Tariff Act, 1985. Since there was a dispute with regard to the classification of the product and the appellant was not agreeing to the stand of the department, the appellant accordingly, filed a declaration under Rule 173B of the Central Excise Rules, 1944 (hereinafter referred to as the Rules) in the prescribed proforma. In the remark column, the appellant mentioned:

(2.) In addition to the above, the appellant issued a letter dated 24th December, 1996 to the Assistant Commissioner, Central Excise Division, Moradabad indicating that the manufacture of shampoo does not attract central excise duty under Chapter heading 3305.99 and the conclusion drawn by the Central Excise department treating the said product as an excisable good was not tenable in law. The appellant in the said letter accordingly prayed that they may be permitted to avail the provisional assessment to duty under Rule 9B of the Rules till the case was finally decided. The appellant also informed the authority that in order to resume their business of manufacture of the said product and also to comply with the requirement of Central Excise Rules they were submitting the declaration of goods under Rule 173B of the Rules under protest. The letter was accompanied by the said declaration form, which was duly received by the Assistant Commissioner. For facility, the letter dated 24th December, 1996 issued by the petitioner to the Assistant Commissioner, Moradabad is extracted hereunder in extenso:

(3.) In order to resume the business of the manufacture and sale of the above product, and also to comply with the requirements of Central Excise Rules, 1944 we are submitting herewith the declaration of goods produced or manufactured in terms of Rule 173-B of the Central Excise Rules, 1944 for favour of necessary action at your end.