2025-VIL-2145-CESTAT-DEL-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise – Area-Based exemption, Classification of dietary supplements, Exemption under Notification No. 49/2003-CE – Appellant manufactured dietary supplements and cleared it without paying excise duty claiming benefit of exemption under Notification No. 49/2003-CE - Department found that the appellant was manufacturing dietary supplements, which were not covered under the exemption notification, and instead classified them under CETH 21069099 - Whether the dietary supplements manufactured by the appellant were correctly classified under CETH 21069099 and excluded from Chapter 30 of the Central Excise Tariff - HELD - The Chapter Note 1(a) to Chapter 30 of the Central Excise Tariff clearly excludes "food or beverages (such as diabetic, diabetic or fortified food, food supplements, tonic beverages and mineral waters), other than nutritional preparation for intravenous administration" from the purview of Chapter 30 – The food supplements other than nutritional preparations for intravenous administration will not fall under Chapter 30. The Chapter note 1(a) to Chapter 30 of the Central excise Tariff excludes dietary supplements from its purview - The dietary supplements manufactured by the appellant are correctly classified under CETH 21069099 and not under CETH 3003 as claimed by the appellant – Since the dietary supplements are correctly classified under CETH 21069099 and not under CETH 3003 as claimed by the appellant, the appellant is not entitled to the benefit of exemption under Notification No. 49/2003-CE, which was limited to specified goods, which did not include dietary supplements – The impugned order is upheld and the appeal is dismissed - Whether the extended period of limitation was correctly invoked and penalty under Section 11AC was rightly imposed - HELD - The appellant had intentionally mis-declared the dietary supplements as "Pharmaceutical products falling under CETH 30.04" to claim the benefit of exemption under Notification No. 49/2003-CE. The appellant's conducts clearly show an intention to evade duty, and therefore, the extended period of limitation is correctly invoked, and the penalty under Section 11AC is rightly imposed.
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