Sikko Industries Limited Vs CCE (CESTAT Ahmedabad)
The appeal before the Tribunal concerned the classification of a product named “Sikko Fast,” manufactured by the appellant, a company engaged in producing NPK fertilisers, organic fertilisers, seaweed-based fertilisers, and soil conditioners. The appellant had been clearing its products as fertilisers under Chapter 31 of the Central Excise Tariff Act, 1985.
Following a search conducted at the appellant’s factory premises, revenue officials found that the appellant had begun manufacturing a new soil conditioner marketed under the brand name “Sikko Fast.” The department formed a view that the appellant had been clearing the product as a fertiliser while evading Central Excise duty. The department collected clearance data for the product covering the period from July 2014 to June 2017. Along with the data, the appellant submitted literature describing “Sikko Fast” as a granulated soil conditioner.
Samples of the product were taken and sent to the Central Revenue Control Laboratory (CRCL), Vadodara for testing. After recording the statement of the appellant’s authorised representative on 15.09.2017, the department issued a show cause notice dated 16.03.2018 proposing classification of the product under CTH 38249090. The notice also proposed recovery of Central Excise duty amounting to ₹8,63,543 under the proviso to Section 11A, along with interest under Section 11AA and penalty under Section 11AC of the Central Excise Act, 1944 read with Rule 25(1) of the Central Excise Rules, 2002.
