RAKESH KUMAR,J -
(1.)THE appellants are manufactures of excisable goods falling under different Tariff Headings of Central Excise Tariff. The period of dispute in the present case is from 1 -9 -2011 to 31 -3 -2012. The dispute is in respect of product "Anmol Coconut Oil" being manufactured by them in the packing of 200 ml or less.
(2.)While according to the appellant, this product which is packed in the packings of 200 ml or less, contains anti -oxidants and is sold as "pure coconut oil" or "edible product", is classifiable under Heading 1513 of the Central Excise Tariff and the rate of duty would be nil, according to the Department, the coconut oil packed in the packings of 200 ml or less is hair oil covered by Heading 3305 in view of Chapter Note 3 to Chapter 33. The department's stand is based on the Board's Circular No. 890/10/2009/CX, dated 3 -6 -2009 issued under Section 37B of the Central Excise Act, 1944 wherein with regard to heading 3305 read with Chapter Note 3 of Chapter 33, as it stood during the period w.e.f. 28 -2 -2005, it was clarified that the coconut oil packed in containers upto 200 ml. may be considered generally used as hair oil and the same would be classifiable under Heading No. 3305 and not under heading 1513. The CBEC in this regard, referred to field survey conducted wherein it had been found that smaller packings upto 200 ml are normally purchased by the customers for use as hair oil. During the period of dispute, in view of the instructions of the department, the appellant cleared the coconut oil packed in the packings of 200 ml or less on payment of duty under heading 3305 of the Tariff. Subsequently, however, refund claim was filed, which was rejected by the Asstt. Commissioner vide order -in -original dated 1 -8 -2012. The Asstt. Commissioner while rejecting the refund claim relied upon the Board's Circular dated 3 -6 -2009 mentioned above and also the Apex Court's judgements in the case of Ranadey Micronutrients v. CCE reported in : 1996 (87) E.L.T. 19 (S.C.), CCE v. Dhiren Chemical Industries reported in : 2002 (139) E.L.T. 3 (S.C.), CCE v. Maruti Foam Ltd. reported in : 2004 (164) E.L.T. 394 (S.C.), wherein it was held that the circulars issued by the CBEC under Section 37B of the Central Excise Act, 1944 is binding on the department even if it is against the statutory provisions. On appeal being filed to the Commissioner (Appeals) against this order of the Asstt. Commissioner, the Commissioner (Appeals) vide order -in -appeal dated 27 -8 -2012 dismissed the appeal. The Commissioner (Appeals) also relied upon the Apex Court judgement in the case of Ranadey Micronutrients v. CCE (supra), wherein it was held that the circular issued by the Board are binding on the Department.
Against the above order of the Commissioner (Appeals), this appeal has been filed.
(3.)SHRI B.L. Narsimhan, Advocate, ld. Counsel for the appellant, pleaded that the dispute is in respect of Coconut oil sold in the packings of 200 ml or less under the brand name "Anmol", that from the photographs of the labels of the product placed on record, it would be seen that it is not marked as hair oil but is marketed as edible oil, that the label on the packing nowhere mention the product packed as Hair Oil but describes the same as "edible oil" or as "pure coconut oil" or "coconut oil", that in view of this, the product, in question, would be classifiable as coconut oil under Heading No. 1513 of the Central Excise Tariff, that the department's case against the appellant is based only on the Board's Circular dated 3 -6 -2009 issued under Section 37B of the Central Excise Act, 1944 wherein in respect of coconut oil being sold in retail in the packings of 200 ml or less with the labels indicating the same as "edible oil" or "pure coconut oil" or "coconut oil" would be classifiable under Heading No. 3305 in view of Chapter Note 3 of Chapter 33 read with Section Note 2 to Section VI as according to the survey conducted by the Department, the small packings of coconut oil upto the size of 200 ml. are generally used as hair oil by the customers, that the refund claim filed by the appellant has been rejected by the Asstt. Commissioner only on this basis and also in view of the judgements of Apex Court in the case of Ranadey Micronutrients (supra) and Dhiren Chemicals (supra) holding that the Board's Circular are binding on the Department, that the impugned order passed by the Commissioner (Appeals) has also rejected the appeal on the same basis, that the validity of the Board's Circular dated 3 -6 -2009 was challenged before the Hon'ble Madras High Court by filing a writ petition by M/s. VVD and Sons (Pvt.) Ltd. and the Hon'ble Madras High Court vide judgment dated 29 -4 -2014 reported in : 2014 -TIOL -2142 -HC -MAD -CX : 2014 (310) E.L.T. 718 (Mad.) quashed the above mentioned circular issued under Section 37B of the Central Excise Act, 1944 observing that the same is arbitrary and unreasonable and without jurisdiction and hence, null and void and contrary to the provisions of the Central Excise Act, 1944, that the validity of the Board's Circular dated 3 -6 -2009 was also challenged before the Hon'ble Kerala High Court by filing of writ petition by M/s. Marico Industries and Hon'ble Kerala High Court vide judgment dated 10 -11 -2009 reported in, 2012 (282) E.L.T. 180 (KER) held that the circular issued by the department cannot operate when the field is occupied by a decision rendered by Appellate Tribunal and that the department cannot take a stand contrary to the Tribunal's order on this issue, that the Tribunal in the case of Aiswarya Industries v. CCE, Pondicherry reported in : 2009 (235) E.L.T. 544 (Tribunal -Chennai) after taking into account sub -heading Entry No. 33051990, as it stood w.e.f. 28 -2 -2005 held that coconut oil packed and sold in the packages of capacity ranging 50 ml to 500 ml (plastic bottles) and marketed as "pure edible oil" would be classifiable under Heading 1513 as coconut oil and not as hair oil under sub -heading No. 33051990 of the Central Excise Tariff, that this judgement of the Tribunal was followed by the Tribunal in its subsequent judgement dated 3 -5 -2011 in the case of Capital Technologies Ltd. & Ors. v. CCE reported in : 2011 -TIOL -775 -CESTAT -Bang : 2015 (321) E.L.T. 479 (Tri. -Bang.), wherein an identical issue was involved and in this judgement, the Tribunal also held that coconut oil marketed in the packings of size of 50 ml and 100 ml. pouches, 100 ml., 200 ml and 500 ml. pouches/containers would be classifiable as coconut oil under Heading No. 1513 and not as Hair oil under Heading No. 3305, that the civil appeal filed to the Apex Court against this judgement of the Tribunal has been dismissed by the Apex Court vide order dated 23 -2 -2012, that the Tribunal in the case of Amardeo Plastics Industries v. Commissioner reported in, 2007 (210) E.L.T. 360 while examining the question of classification of coconut oil being marketed in plastic containers of 100 ml or 200 ml in addition to pouches of 6 ml. by its majority judgement held that the same would be classifiable under Chapter 15 as "coconut oil" and not as Hair Oil under chapter 33 and that in this judgement, the Tribunal also took into account the fact that the coconut oil being packed in the abovementioned packing was being marketed by the assessee as Hair Oil, but the Tribunal observed that advertisement of a product is not indicative of its classification under the Central Excise Tariff as the same is to lure the customer and enhance the sales, that the Tribunal in the case of Raj Oil Mills and Others v. CCE, Thane -II reported in : 2013 -TIOL -1609 (CESTAT -Mum) : 2014 (314) E.L.T. 541 (Tri. -Mum.) has held that coconut oil sold in the packing of upto 200 ml or less would be classifiable as coconut oil under Heading 1513 and not as hair oil under Chapter 33 and in this regard, the Tribunal followed its earlier judgement in the case of Capital Technologies Ltd. & Ors. and also in the case of Aiswarya Industries (supra) and that in view of the above, the impugned order upholding the rejection of the refund claim is not correct.