COMMISSIONER OF CENTRAL EXCISE Vs. RALLIS INDIA LTD.

JUDGEMENT

(1.) THIS appeal of the Revenue involves a classification dispute. The issue is whether the products Phosphoryl 'A' and Phosphoryl 'B' manufactured by the assessee could be treated as Di -Calcium Phosphate (DCP) classifiable under Heading No. 28.35 as claimed by the Revenue or these products are classifiable as animal feed supplements under Heading 23.02 as claimed by the assessee. The original authority classified the items under Heading 28.35 and accordingly raised a demand of duty on the assessee. That authority relied on the Board's Order (under Section 37B of the Central Excise Act) No. 47/1/97 -CX dated 3 -3 -97, wherein it had been ordered that DCP of animal feed grade should be classified under sub -heading 2835.00 of the CETA Schedule. Ld. Commissioner (Appeals), after considering the analytical report of the Tamil Nadu Veterinary Animal Sciences University and other evidences available on record, held the above goods to be classifiable as animal feed supplements under Heading 23.02. The appellate authority took the view that the above Section 37B order of the CBEC was not applicable to the case on hand. Hence the present appeal of the Revenue.

(2.) THE Gujarat High Court vide order dated 17 -3 -99 in the case of Raymon Glues and Chemicals 2000 (117) E.L.T. 29 (Guj.) and Nagpur Bench of Mumbai High Court vide order dated 23 -8 -99 in the case of M/s. Bamni Proteins quashed the impugned order of the Board under Rule 37B. CEGAT in the case of M/s. Kerala Chemicals and Proteins Ltd. has also decided the matter against the Department. The SLPs and CA filed by the Department in the Hon'ble Supreme Court against the above mentioned orders were dismissed by the Apex Court. The reports from all Chief Commissioners also indicate that there is divergence of practice of assessment of the product in different Commissionerates after Supreme Court judgment in the matter.

(3.) IN view of the Apex Court decisions against the Department's 37B order, the instructions contained in 37B order dated 3 -3 -97 would no longer be valid in their entirety. These instructions may, therefore, be treated as withdrawn.