1 When the matter was called, none appeared for the Respondents. Heard the D.R. and gone through the materials.
2. The Revenue has filed this appeal against the order of the Commissioner (Appeals), who vide the impugned order classified imported methyl parathion technical purity 80% under Heading 3.808.10. The Commissioner, after considering that the Central Board of Excise & Customs, had issued a circular for classifying insecticide of technical grade under Chapter 29 which was challenged before the Hon'ble High Court of Delhi by pesticides manufacturers and Hon'ble High Court was pleased to pass an order as under: "For the foregoing reasons, the petition allowed. The impugned Circular number 348/64/97 dated 25.10.97 issued by the Central Board of Excise and Customs is directed to be struck down. All the notices issued and action taken based on the said circular shall also stand quashed and set aside. No order as to costs." Thereafter noting that Heading 2920 adopted by the Department covers esters of inorganic acids whereas heading 3808.10 covers insecticides by specific mention and considering to be preferable in terms of interpretative rules to Customs Tariff Act, 1975, he upheld the classification under Heading 38.
(i) Item under import i.e. Methyl Parathion Technical is a well defined chemical conforming to a chemical formula and is not a preparation to fall under Heading 38.
(ii) Chapter Note 1 (a)(2) to Chapter 38 of well defined compound would be covered under Heading 3808, provided they were put up in forms or packing for retail sale or as articles, and since in the present case the packing were not in that form, the Chapter Note 1 (a) (2) to Chapter 38 will not be covered the item under import.
(iii) As regards the contention of more specific heading prevailing over generic heading, found by the Commissioner, primarily, classification has to be decided according to the heading and section and chapter notes only as per Rule 1 of Interpretative Rules and since chapter notes to chapter 38 would clearly excludes the item under import, the classification has to be shifted to its respective chapter 28 or 29 and in this case it would be in Chapter 29. The words "insecticides, pesticides etc" have been qualified subsequently by the words "put up in form or packing for retail sales or articles..." and therefore classification under Chapter 29 would be more appropriate.
(a) the Note to Chapter 38 relied upon by the Revenue cannot be interpreted that a well defined chemical conforming to a particular molecular formula cannot be assessed under Heading 3808 or under 3808.10 if such chemical molecular formula is better known and is pesticide and/or insecticide. Pesticides and insecticides have to be understood as defined in the Insecticides Act, 1968. A large number of well defined chemicals are figuring in the Schedule given to this enactment only because they are used as such. These chemicals are not understood by the persons deal with them in international or national trade as salts or esters of various acids as mentioned under the Heading of Chapter 29. Where, the Revenue wants to classify them. The entity is a known pesticides & would merit classification under 380810 (b) The classification for a chemical under Chapter 29 would be depended on the purity of that chemical, the present imports are of 80% pure pesticides/used of technical grade. The other 20% being various impurities fillers etc. There is no finding arrived at by the original authority or in the grounds brought out in Revenue's appeal, as to why the imported goods, in this case, should be considered to be chemically pure and 20% missing part of this purity should be condoned as permissible impurities to qualify by applying chapter notes of Chapter 29. Therefore qualification for classification under chapter 29.
5. In this view of the finding, no merits are found in the Revenue's appeal to classify impure technical grade chemical under Chapter 29.
The item under import is known as pesticides and has to be classified under Heading 38. We do not find any infirmity in the findings of the Commissioner (Appeals).