Rajan Jhiriwal Vs Additional Director General (Adjudication) (CESTAT Delhi)
The appeals before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi, challenged an order dated 31.01.2022 passed by the Additional Director General (Adjudication), New Delhi. The principal issue concerned the classification of products marketed under the “MAMA” brand. The department had classified the products as “zarda scented tobacco” under Central Excise Tariff Item (CETI) 2403 99 30 and consequently confirmed demands of central excise duty, interest, and penalties. The appellants contended that the products were correctly classifiable as “chewing tobacco” under CETI 2403 99 10. Penalties imposed under Rule 26 of the Central Excise Rules on associated entities and partners were also under challenge.
The records showed that the appellant had commenced manufacturing zarda and supari under the “MAMA” brand at two separate units. By a letter dated 02.08.2012, the appellant informed the departmental authorities of its intention to manufacture “MAMA zarda” as “chewing tobacco (powder form)” and submitted the prescribed declaration under the relevant Capacity Determination Rules. Pursuant to this declaration, the Assistant Commissioner classified the products under CETI 2403 99 10 as chewing tobacco. Thereafter, multiple departmental orders issued between 2012 and 2016 consistently classified the products under the same tariff entry.
