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The Mumbai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that no excise duty is payable as Parle’s ‘Cheeselings’ covered under ‘Namkeen’.
The bench of C J Mathew (Technical Member) and Ajay Sharma (Judicial Member) has observed that ‘Cheeselings’ is a peculiarly indigenous preparation. ‘Namkeen’ has not been defined either contextually in the notification or as a separate nomenclature in the tariff.
Background
The appellant/assessee, Parle Products has challenged the denial of benefit extended by notification no. 3/2006-CE dated 1st March 2006 and, therefore, eligible only for rate of duty applicable to ‘ready to eat packaged foods’.
The appellant, a manufacturer of biscuits, confectionary and similar products, had, for the period between January 2012 and December 2012, availed the benefit on clearance of ‘cheeselings’ claiming to be ‘namkeen’ classifiable against tariff item 2106 9099 of Schedule to Central Excise Tariff Act, 1985 which was entitled to the benefit of the said notification.
The denial saddled with duty liability of Rs. 81,23,300 under section 11A of Central Excise Act, 1944, along with applicable interest under section 11AA of Central Excise Act, 1944, besides being imposed with penalty of like amount under rule 25 of Central Excise Rules, 2002 is the cause of grievance.
It is seen from the order, that the tariff item covers preparations not elsewhere specified or included other than protein concentrates and textured protein substances and specified excluded commodities.
The classification itself is not in dispute and it has been held in the impugned order that the process of manufacturing ‘cheeselings’ is different from that of ‘namkeen’ which, even by portrayal of the product as ‘namkeen’ does not suffice for the purpose of benefit of exemption.
The adjudicating authority has held that cheeselings may be sold ‘Namkeen” but its classification would be governed by its nature and composition. The cheeselings are “Snack food” only and therefore classifiable as “Ready to Eat Packaged Foods” under Sr. No. 10 of Notification No.2/2006 dt. 13.2011 as amended. Merely by claiming that products “Cheesling” are being sold in market as “Namkeen items” as appearing on the outer wrapper of the products, will not qualify Noticee’s claim that they are eligible for exemption for payment of central excise duty under Notification No. 3/2006 CE dated 1/3/2006 (Serial No. 29) as amended.’
Issue Raised
The issue raised was whether ‘cheeselings’, introduced by the appellant into the Indian market in 1956, is entitled to coverage as ‘namkeen’ – a common expression for savouries sold in the retail package as well as loose in the Indian market. ‘Cheeselings’ is a peculiarly indigenous preparation.
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Conclusion
The tribunal held that the adjudicating authority has erred in concluding that the impugned goods are not ‘namkeen’ as there was no allegation of non-conformity with any prescribed description which renders it impossible for us to determine finding as legal and proper.
FAQs
Do Parle’s ‘Cheeselings’ Covered Under ‘Namkeen’, attract Excise Duty ?
No. Excise duty is not payable on Parle’s ‘Cheeselings’ as they are covered under ‘Namkeen’.
Case Title: Parle Products Pvt Ltd v/s Commissioner of Central Excise Mumbai
Citation: EXCISE APPEAL NO: 85839 OF 2014
Counsel for the Petitioner: Viraj Reshamwala
Counsel for the Respondent: P K Acharya
