Commissioner of Customs Vs Reliance Industries Limited (Supreme Court of India)
In Commissioner of Customs Vs Reliance Industries Limited, the Supreme Court considered whether the imported product “n-Hexane” or “Exxsol Hexane” should be classified under Chapter 27 of the Customs Tariff Act and Central Excise Tariff Act as petroleum oil/motor spirit, or under Chapter 29 as a separate chemically defined organic compound. The Revenue argued that the product should fall under Customs Tariff Heading 2710.00 and Central Excise Tariff Heading 2710.12, while the assessee claimed classification under Customs Tariff Heading 2901.10 and Central Excise Tariff Heading 2901.90.
The dispute arose after the assessee imported n-Hexane and filed Bills of Entry classifying it as a saturated acyclic hydrocarbon existing in commercially pure form under Chapter 29. The Revenue relied on a chemical test report issued by SGS Redwood Services, which recorded that the imported product had a distillation range between 63°C and 70°C and a flash point below 25°C. On this basis, the department contended that the product was an admixture of hydrocarbons and qualified as motor spirit under Chapter 27.
The adjudicating authority accepted the Revenue’s view and classified the product under Chapter 27. However, the Commissioner (Appeals) reversed the finding by relying on Harmonized System of Nomenclature (HSN) Notes, which specifically mention Hexane under Heading 2901.10 dealing with acyclic hydrocarbons. The Commissioner held that n-Hexane was a separate chemically defined compound and therefore classifiable under Chapter 29.
