Sumo Foods Pvt Ltd. Vs Commissioner of Central Excise (CESTAT Hyderabad)
CESTAT Rejects Excise Duty on Sugar Syrup Because Fructose Content Was Below 50%; CESTAT Holds Captively Consumed Sugar Syrup Not Classifiable as Invert Sugar; Excise Demand on Biscuit Manufacturer Set Aside Because Sugar Syrup Was Not Marketable; CESTAT Rejects Invert Sugar Classification Due to Absence of Chemical Evidence on Fructose Content.
In Sumo Foods Pvt Ltd. Vs Commissioner of Central Excise, the Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed the appeals and held that sugar syrup prepared and captively consumed in the manufacture of biscuits was neither marketable nor classifiable as “invert sugar” under tariff heading 17029090, and therefore not liable to central excise duty.
The appellant manufactured biscuits on job-work basis for Parle Products Pvt Ltd. During the manufacturing process, sugar syrup was prepared by mixing sugar, water, and a small quantity of citric acid, followed by heating and cooling, after which it was used captively in biscuit production. The department treated the syrup as excisable goods classifiable under tariff item 17029090 and confirmed excise duty demands along with interest and penalties for the periods from 01.07.2008 to 31.03.2011 and 01.04.2011 to 11.09.2011.
