Cir. No.446/12/1999-CX, dt. 17/03/1999

Circular No. 446/12/99-CX, dated 17/3/1999

F.No. 126/3/98-CX.3
Subject : Dispute in classification of "Phenyl" manufactured by M/s. Bengal Chemical & Pharmaceuticals Limited - regarding.

Attention is invited to the instructions contained in Board"s Circular dated 10th November, 1986 wherein Board had clarified that "Phenyl" would be classifiable under sub-heading 3801.90.

2. A dispute has been raised regarding classification of "Phenyl" manufactured by M/s. Bengal Chemicals & Pharmaceuticals Ltd., whether under sub-heading 3808.90 - as others or 3808.10 - as pesticide.

3. The issue was discussed in the Board Meeting. the Board felt that the decision dated 18th April, 1995 of the Hon"ble Supreme Court in CA No. 2276 of 1986 was with reference to the old Central Excise Tariff where pesticides were specifically exempted under T.I.68. Disinfectants did not find a place under the old Central Excise Tariff as they do under the new Central Excise Tariff. As disinfectants are now specifically mentioned in the new Central Excise Tariff, Board feels that the said decision of the Supreme Court would be applicable only to the old tariff. Any products which are commonly used and marketed/known as "disinfectant liquids" cannot be equated with pesticides and charged to lower rate of duty of 8% adv. under Heading 3808.10. The product "Phenyl" is basically marketed as disinfectant in liquid form. The product manufactured by the unit contains high boiling tar acid and phenolic compounds.

4. Considering the description, function and uses, the Board is of the view that the product "Phenyl" marketed as disinfectant would be classifiable under sub-heading No. 3808.90 of Central Excise Tariff attracting central excise duty @18%.

5. All pending disputes/assessments on the issue may be settled in the light of these guidelines.

Sd/-
(Renu K. Jagdev)
Under Secretary to the Government of India