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Regarding Central Excise - Classification of Ultramarine Blue whether
under sub-heading No. 3206.10 or under sub-heading No. 3212.90 - Clarification
Circular
No. 546 dated 6th September 2000
I
am directed to refer to Board's Circular No. 62/90-CX.3, dated the 7th December
1990 (vide F.No. 112/9/90-CX.3) on the subject cited above. In the circular, it
was inter alia clarified on the basis of opinion given by the Chief Chemist that
the ultramarine blue in bulk form is appropriately classifiable under chapter
heading 32.06; and the same when put up in small packings, would be classified
under heading No. 32.12 of Central Excise Tariff Act, 1985.
2.
The issue of classification of ultimate blue prior to 1995 was
re-examined while examining the CEGAT's Order No. 2332/99, dated 8.9.99. The
judgement of the CEGAT has been accepted keeping in view that the CEGAT has
relied on the Hon�ble Supreme Court's judgement in the case of Reckit Coleman
India Ltd. reported in 1995(76) ELT - A55 wherein the department's SLP against
the Andhra Pradesh High Court Order was dismissed. The Hon'ble High Court of
Andhra Pradesh have in the Reckit & Coleman case reported in 1994(72) ELT
263, clearly stated that the same product would not merit classification under
two separate headings in the absence of any specific provision treating the
process of repacking from bulk to retail, labelling or re-labelling as amounting
to manufacture. Chapter Note 3 was introduced treating such processes as
amounting to manufacture in 1995.
3.
In view of the foregoing, it has been decided by the Board to withdraw
the Circular No. 62/90, dated 7.12.1990 which clarified that ultramarine blue in
bulk and retail forms respectively are classified under 32.06 and 32.12. The
classification of ultramarine blue would be under Chapter 32.06 as decided in
the CEGAT orders cited supra which has been accepted by the Department. However,
it is also clarified that chapter Note 3 would be the guiding factor for
classification of the product after it was introduced.
4.
All pending assessments may be finalised on the above basis. Lower field
formations may be advised suitably. The trade may also be informed accordingly.
5.
Hindi version is enclosed. The receipt of this circular may kindly be
acknowledged.
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