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CASE NO.: Appeal (civil)  2215 of 2002

PETITIONER: Commissioner of Customs & Central Excise, Goa

RESPONDENT: Phil Corporation Ltd.

DATE OF JUDGMENT: 07/02/2008

BENCH: Ashok Bhan & Dalveer Bhandari

JUDGMENT: J U D G M E N T  WITH C.A. Nos.7325-7326/2001 & 7242-7243 OF 2002

Dalveer Bhandari, J. 1.      We propose to dispose of the aforesaid appeals by  this judgment because common questions of law are  involved in these appeals.  In order to avoid repetition,  the facts of Civil Appeal No.2215 of 2002 are  recapitulated in order to comprehend the controversy  involved in these cases.

2.      M/s Phil Corporation Ltd., the respondent assessee  manufactures processed cashew nuts, peanuts, almonds  etc. by dry roasting, oil roasting, salting, seasoning and  packs them in different containers and clears these items  under its brand name.   Admittedly, the respondent  assessee did not register with the Central Excise  Authorities and cleared these goods without payment of  excise duty.    

3.      After due investigation, a show cause notice was  issued by the Commissioner of Customs and Central  Excise, Goa on 6.8.1999 to the respondent assessee  demanding duty under Chapter 20(2001.10) on the goods  cleared without payment of central excise duty and  proposed penalty action.  The respondent assessee in its  reply dated 4.10.1999 denied the allegations incorporated  in the show cause notice and submitted that its products  were correctly classifiable under Chapter Heading  0801.00 of the Central Excise Tariff Act, 1985 and  chargeable to Nil rate of duty and hence there was no  requirement to register with the Central Excise  Authorities.    4.      After hearing the respondent assessee, the  Commissioner of Customs & Central Excise vide his  Order-in-Original dated 31.10.2000 held that the goods  are to be classified under Chapter 2001.10 and  chargeable to duty and confirmed the demand and  imposed penalty and redemption fine in lieu of  confiscation of the seized goods and machinery.     5.      Against the said order of the Commissioner of  Customs & Central Excise, Goa, the respondent assessee  filed an appeal before the Customs, Excise & Gold  (Control) Appellate Tribunal, West Regional Bench at

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Mumbai.   The Tribunal vide its impugned order dated  24.10.2001 allowed the appeal of the respondent  assessee and held that the goods cleared by the  respondent assessee are not assessable to duty.     

6.      Aggrieved by the order of the Tribunal, the appellant  Commissioner of Customs & Central Excise, Goa has  preferred this appeal before this Court.  

7.      In order to properly comprehend the controversy  involved in these cases, we deem it proper to reproduce  the legislative intention by reproducing the extracts of  Chapters 8 and 20 of the Central Excise Tariff Act, 1985.          CHAPTER 8  

EDIBLE FRUIT AND NUTS; PEEL OF CITRUS FRUIT  OR MELONS

Note:

This Chapter does not cover inedible fruits or nuts.

Heading No. Sub- Heading No. Description of Goods Rate of  Duty 1 2 3 4

08.01

0801.00 Edible fruit and  nuts; peel of citrus  fruit or melons Nil

CHAPTER 20  

PREPARATIONS OF VEGETABLES, FRUIT, NUTS OR  OTHER PARTS OF PLANTS

Notes:

1.      This Chapter covers only products which are  prepared or preserved by processes other than merely  chilled or frozen, or put in provisional preservative  solutions, or dried, dehydrated or evaporated.

2.      This Chapter does not cover fruit jellies, fruit  pastes, sugar-coated almonds or the like in the form of  sugar confectionery (Chapter 17) or chocolate  confectionery (Chapter 18). 3.      In relation to products of this Chapter,

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labeling or relabelling of containers and repacking  from bulk packs to retail packs or the adoption of  any other treatment to render the product  marketable to the consumer, shall amount to  "manufacture".

4.      In this Chapter, "brand name" means a brand  name, whether registered or not, that is to say, a name  or a mark, such as a symbol, monogram, label,  signature or invented words or any writing which is  used in relation to a product, for the purpose of  indicating, or so as to indicate, a connection in the  course of trade between the product and some person  using such name or mark with or without any  indication of the identity of that person.  

Heading No. Sub- Heading No. Description of Goods Rate of  Duty 1 2 3 4

20.01

Preparations of  vegetables, fruit,  nuts or other parts  of plants including  jams, fruit jellies,  marmalades, fruit  or nut puree and  fruit or nut pastes,  fruit juices and  vegetable juices,  whether or not  containing added  sugar or other  sweetening matter.

2001.10 Put up in unit  containers and  bearing a brand  name.

16%

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2001.90 Other Nil

Now, we would like to setout extracts of Chapters  8 and 20 of the Harmonized System of Nomenclature  (HSN) as under:

"CHAPTER 8

EDIBLE FRUIT AND NUTS; PEEL OF CITRUS FRUIT  OR MELONS

Chapter Notes: 1.      This Chapter does not cover inedible nuts or fruits.

2.      Chilled fruits and nuts are to be classified in the  same headings as the corresponding fresh fruits  and nuts.

3.      Dried fruit or dried nuts of this Chapter may be  partially rehydrated, or treated for the following  purposes:

(a)     For additional preservation or stabilization  (e.g. by moderate heat treatment, sulphuring,  the addition of sorbic acid or potassium  sorbate),

(b)     To improve or maintain their appearance (e.g.  by the addition of vegetable oil or small  quantities of glucose syrup),

provided that they retain the character of dried fruit  or dried nuts.

        Headings 08.01 and 08.02 read as under: 08.01   COCONUTS, BRAZIL NUTS AND CASHEW  NUTS, FRESH OR DRIED, WHETHER OR  NOT SHELLED OR PEELED.

-       Coconuts: 0801.11 --      Desiccated 0801.19 --      Other                 -       Brazil Nuts: 0801.21 --      In Shell 0801.22 --      Shelled                 -       Cashew Nuts: 0801.31 --      In Shell 0801.32 --      Shelled

08.02   OTHER NUTS, FRESH OR DRIED, WEHTER  OR NOT SHELLED OR PEELED.  

-       Almonds: 0802.11 --      In shell 0802.12 --      Shelled                 -       Hazelnuts or filberts (Corylus spp.): 0802.21 --      In Shell 0802.22 --      Shelled                 -       Walnuts:

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0802.31 --      In Shell 0802.32 --      Shelled 0802.40 --      Chestnuts (Castanea spp.) 0802.50 --      Pistachios 0802.90 --      Other The principal nuts of this heading are almonds  (sweet or bitter), hazelnuts or filberts, walnuts, chestnuts  (Castanea spp.), pistachios, pecans and pignolia nuts  (seeds of the Pinus pinea).

This heading also covers  areca (betel) nuts used  chiefly as a masticatory, cola (kola) nuts used both as a  masticatory and as a base in the manufacture of  beverages, and an edible, nut-like, spiny-angled fruit of  the species Trapa natans, sometimes referred to as a  water chestnut.

The heading does not include: (a)     The edible tuber of the species Eleocharis  dulcis or Eleocharis tuberose, commonly  known as the Chinese water chestnut (heading  07.14).

(b)     Empty walnut or almond hulls (heading 14.04)

(c)     Ground-nuts (heading 12.02), roasted  ground-nuts or peanut butter (heading  20.08)

(d)     Horse chestnuts (Aesculus hippocastanum)  (heading 23.08)."

Chapter 8 does not include roasted ground nuts  or peanuts.  

"CHAPTER 20

PREPARATIONS OF VEGETABLES, FRUIT, NUTS OR  OTHER PARTS OF PLANTS

Chapter Notes: 1.      This Chapter does not cover:

(a)     Vegetables, fruit or nuts, prepared or  preserved by the processes specified in  Chapter 7, 8 or 11;

(b)     Food preparations containing more than 20%  by weight of sausage, meat, meat offal, blood,  fish or crustaceans, molluscs or other aquatic  invertebrates, or any combination thereof  (Chapter 16); or

(c)     Homogenised composite food preparations of  heading 21.04.

2.      Headings 20.07 and 20.08 do not apply  to fruit  jellies, fruit pastes, sugar-coated almonds or the  like in the form of sugar confectionary (heading  17.04) or chocolate confectionery (heading 18.06).

3.      Headings 20.01, 20.04 and 20.05 cover, as the case  may be, only those products of Chapter 7 or of

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heading 11.05 or 11.06 (other than flour, meal and  powder of the products of Chapter 8) which have  been prepared or preserved by processes other than  those referred to in Note 1 (a).

4.      Tomato juice the dry weight content of which is 7%  or more is to be classified in heading 20.02.

5.      For the purpose of heading 20.07, the expression  "obtained by cooking" means obtained by heat  treatment at atmospheric pressure or under  reduced pressure to increase the viscosity of a  product through reduction of water content or other  means.

6.      For the purpose of heading 20.09, the expression  "juices, unfermented and not containing added  spirit" means juices of an alcoholic strength by  volume (see Note 2 to Chapter 22) not exceeding  0.5% vol.

20.08   FRUIT, NUTS AND OTHER EDIBLE PARTS OF  PLANTS, OTHERWISE PREPARED OR  PRESERVED WHETHER OR NOT  CONTAINING ADDED SUGAR OR OTHER  SWEETENING MATTER OR SPIRIT, NOT  ELSEWHERE SPECIFIED OR INCLUDED.  

-       Nuts, ground-nuts, and other  seeds, whether or not mixed  together:

2008.11 --      Ground-nuts 2008.19 --      Other, including mixtures                2008.20 --      Pineapples 2008.30 --      Citrus fruit             2008.40 --      Pears 2008.50 --      Apricots                 2008.60 --      Cherries 2008.70 --      Peaches, including nectarines 2008.80 --      Strawberries --      Other, including mixtures other  than those of subheading 2008.19:                  2008.91 --      Palm hearts 2008.92 --      Mixtures 2008.99 --      Other    

This heading covers fruit, nuts and other edible  parts of plants, whether whole, in pieces or crushed,  including mixtures thereof, prepared or preserved  otherwise than by any of the processes specified in other  Chapters or in the preceding headings of this Chapter.

        It includes, inter alia: 1.      Almonds, ground-nuts, areca (or betel) nuts and  other nuts, dry-roasted, oil-roasted or fat- roasted, whether or not containing or coated  with vegetable oil, salt, flavours, spices or other  additives.

2.      x       x       x  "

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8.      Mr. Vikas Singh, the learned Additional Solicitor  General appearing for the Revenue submitted that the  respondent-assessee received  cashew nuts, peanuts,  almond etc. and carried out various processes such as  dry/oil roasting, salting, roasting with spices or herbs  and flavours, such  as dry mint (pudina), spicy (chatpata)  etc. and flushes these products with nitrogen gas. These  products are thereafter packed in unit containers bearing  brand names such as Country Club and Maharaj.  These  products fall under Chapter 20 of the Central Excise  Tariff Act.  The Harmonized System of Nomenclature,  popularly and in short ’HSN’ Notes to Chapter 20  categorically state that Chapter 20 includes almond,  groundnuts which are dry roasted, oil roasted or fat  roasted.  The relevant portion of HSN Note of Chapter 20  is extracted hereunder :- "It inter alia includes almonds, groundnuts,  areca (or betel) nuts and other nuts, dry  roasted, oil roasted or fat roasted, whether or  not containing or coated with vegetable oil,  salt, flavours, spices or additives."

9.      The learned Additional Solicitor General submitted  that in the HSN Notes to Chapter 8, roasted groundnuts  have been specifically excluded whereas in Note 1 of  Chapter 20 of the Central Excise Tariff Act, all products  where preservative solution is applied or dried,  dehydrated or evaporated, have been included.  Note 1 of  Chapter 20 states as under:- "This chapter covers only products which are  prepared or preserved by processes other than  merely chilled or frozen, or put in provisional  preservative solution or dried dehydrated or  evaporated." 10.     The learned Additional Solicitor General further  submitted that the controversy involved in this case is no  longer res integra.   He placed reliance on the recent  judgment of this court in Amrit Agro Industries Ltd. &  Anr. v. Commissioner of Central Excise, Ghaziabad  (2007) 201 ELT 183 (SC), according to which roasted  peanuts would fall under Chapter 20.  Para 6 of the  judgment reads as under:- "Having gone through the records and having  examined the process undertaken by the  assessee, we are in agreement with the view  expressed by the Tribunal ("CEGAT") regarding  classification of roasted peanuts under  Heading 20.01. The Tribunal had adopted a  correct test when it says that the essential  structure of the peanut is not changed by the  process of roasting. The assessee merely  applies salt to roasted peanuts which does not  obliterate the essential character. Moreover,  roasting is a process. That process has not  been excluded in Note 1 to Chapter 20.  Therefore, roasted peanuts are covered by  Chapter 20. Even according to the Explanatory  notes of HSN under Heading 20.08 ground- nuts, almonds, peanuts etc. which are dry- roasted, fat-roasted whether or not containing  vegetable oil are the items which all would

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stand covered by the said Heading 20.08." 11.     The learned Additional Solicitor General has also  drawn our attention to paragraph 7 of the said judgment  which reads as under:-

"As stated above, roasted peanut is also a  preparation, however, it is a preparation of  nuts like almonds, peanuts, ground-nuts etc.  They are products which are prepared or  preserved by processes like roasting. As stated  above, roasting is not chilling, it is not  freezing. As stated above, roasting is not one of  the enumerated processes in Chapter Note No.  1 to Chapter 20. Heading 20.01 specifically  refers to preparations of vegetables fruit, nuts  or plants. Sub-heading 2001.90 refers to the  word ’Other’. In the circumstances, we are in  agreement with the view expressed by the  Tribunal that roasted peanut falls under  Chapter 20 and not under Chapter 21."

12.     He contended that HSN is quite relevant for the  purpose of deciding issues of classification.  In the  present case, the HSN explanatory notes to Chapter 20  categorically state that the products in question are so  included in Chapter 20.  The HSN explanatory notes to  Chapter 20 also clearly indicate that its products are  excluded from Chapter 8 as they fall in Chapter 20.  In  these circumstances, it has been submitted that the  classification of the products in question have to be made  under Chapter 20.

13.     The learned Additional Solicitor General also placed  reliance on the judgment of this court in Collector of  Central Excise, Shillong v. Wood Craft Products Ltd.  (1995) 3 SCC 454. This court in paragraph 12 of the said  judgment observed as under:- "Accordingly, for resolving any dispute relating  to tariff classification, a safe guide is the  internationally accepted nomenclature  emerging from the HSN.  This being the  expressly acknowledged basis of the structure  of the Central Excise Tariff in the Act and the  tariff classification made therein, in case of  any doubt the HSN is a safe guide for  ascertaining the true meaning of any  expression used in the Act."

14.     The learned Additional Solicitor General referred to  section 2(f)(ii) of the Central Excise Act which  categorically states that any process which is specified in  the Chapter Notes as amounting to manufacture would  be deemed to be manufacture.  Section 2(f)(ii) reads as  under:- "2(f)      "manufacture" includes any  process -  

(i)         \005\005

(ii)    which is specified in relation to any goods  in the section or chapter notes of the  First Schedule to the Central Excise Tariff  Act, 1985 (5 of 1986) as amounting to  manufacture."

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15.     The learned Additional Solicitor General submitted  that the respondent apart from processing of products by  oil roasting etc. is involved in packing the products in  retail containers of smaller packets of 50 gms./20 gms.  which bear the brand name of the respondent-assessee.   According to the appellant, this process by itself would  amount to "manufacture" under Chapter Note 3 of  Chapter 20.  The process of the assessee making the  products marketable by putting the products into small  unit containers and branding the said goods squarely  falls under Chapter Note 3 of Chapter 20. He submitted  that the aforesaid processes have been admitted by the  respondent-assessee.          16.     The learned Additional Solicitor General further  submitted that the traditional concept of "manufacture"  is not applicable in the instant case in view of Chapter  Note 3 of Chapter 20 and section 2(f)(ii) of the Central  Excise Act.  He submitted that even if a process is not  manufacture it has to be held "manufacture" if the  Chapter Note so states that it would amount to  manufacture.  The scope and ambit of section 2(f)(ii) has  been explained by this court in several decisions.  He  placed reliance on Collector, Central Excise, Bombay v.  S.D. Fine Chemicals Pvt. Ltd. (1995) Supp 2 SCC 336.   This court in the said judgment held that certain  processes which may not otherwise amount to  manufacture have been deemed to be manufacture by  the Parliament under section 2(f)(ii).  The learned counsel  placed reliance on paragraph 12 of the said judgment  which reads as under:-  "The decisions aforesaid make it clear that the  definition of the expression ’manufacture’  under Section 2(f ) of the Act is not confined to  the natural meaning of the expression  ’manufacture’ but is an expansive definition.  Certain processes, which may not have  otherwise amounted to manufacture, are also  brought within the purview of and placed  within the ambit of the said definition by  Parliament. Not only processes which are  incidental and ancillary to the completion of  manufactured product but also those  processes as are specified in relation to any  goods in the section or Chapter Notes of the  Schedule to the Central Excise Tariff Act, 1985  are also brought within the ambit of the  definition."  

17.     The learned Additional Solicitor General also placed  reliance on O.K. Play (India) Ltd.  v. Commissioner of  Central Excise-II, New Delhi (2005) 2 SCC 555.  This  court while dealing with the scope of section 2(f) observed  as under:- "Section 2(f) contains two clauses and instead  of setting out the activities in respect of  different tariff items, sub-clause (ii) simply  states that any process, which is specified in  section/chapter notes of the schedule to the  Tariff Act, shall amount to "manufacture".  Under sub-clause (ii), the legislature intended  to levy excise duty on activities that do not  result in any new commodity. In other words,

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if a process is declared as amounting to  "manufacture" in the section or chapter notes,  it would come within the definition of  "manufacture" under Section 2(f) and such  process would become liable to excise duty.  The effect of this definition is that excise duty  can be levied on activities which do not result  in the production of a new commodity or where  the raw material does not undergo such a  transformation as to lose its original identity."

18.     The court in the said judgment in paragraph 13  observed that the activities which otherwise do not  amount to manufacture can now be treated as  manufacture and made liable to duty. 19.     In reply to the submissions of the learned Additional  Solicitor General, Mr. Joseph Vellapally, the learned  senior advocate appearing for the respondent assessee  submitted that the entire case of the appellant  (Commissioner of Customs & Central Excise, Goa) in a  show cause notice and before the tribunal was that the  process of roasting, salting etc. amounts to manufacture  because a new commodity emerges, i.e., the  manufactured commodity goes from Chapter 8 and falls  under Chapter 20.  According to him, though there was  specific reference to section 2(f)(ii) in the show cause  notice, but no case was made out under section 2(f)(ii)   read with Chapter Note 3 of Chapter 20 and the  department cannot be permitted to travel beyond the  show cause notice and make out a new case before this  court.   

20.     Mr. Vellapally also submitted that the inclusive  definition of manufacture under Chapter Note 3 of  Chapter 20 read with section 2(f)(ii)  of the Central Excise  Act has to be strictly construed.  He submitted that the  first requirement is that the goods to which the Chapter  Note can be applied must firstly fall under that Chapter  (i.e. as a food preparation and secondly those goods must  be subject to one of the processes mentioned in the  Chapter Note).  According to him, the said Chapter Note  has absolutely no application where the goods which are  alleged to be subjected to the mentioned processes are  classifiable under some other chapter, for example under  Chapter 8 in this case.  According to him, raw nuts are  agricultural produce falling under Chapter 8 and not  subject to duty is the admitted case of the department.   Therefore, there is no Chapter Note dealing with the  deeming processes carried on in relation to goods of  Chapter 8 to be manufacture.

21.     Mr. Vellapally further submitted that once it is  accepted that roasting, salting etc. do not change the  essential character of the product as an agricultural  product, the final product continues to be an agriculture  product falling under Chapter 8 and not a manufactured  product under Chapter 20. He submitted that it is  undisputed that the nuts retain their essential character  even after roasting etc.  Therefore, the respondent was  under a bona fide belief that the goods are not excisable.   If the assessee has an arguable case or divergent views  are possible then the penalty cannot be imposed and  extended period cannot be invoked.  He placed reliance  on Siddhartha Tubes Ltd. v. Commissioner of  Customs & Central  Excise, Indore (M.P.) (2005) 13

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SCC 559 and Jaiprakash Industries Ltd. v.  Commissioner of Central Excise, Chandigarh  (2003)  1 SCC 67.

22.     Mr. Vellapally further placed reliance on the  Constitution Bench judgment of this court in Union of  India & Anr. v. Delhi Cloth & General Mills Co. Ltd.  AIR 1963 SC 791 : 1963 Supp (1) SCR 586.  In this case,  this court considered the scope and ambit of inclusive  definition of section 2(f). Paragraph 18 of the said  judgment reads as under:-

"We are unable to agree with the learned  counsel that by inserting this definition of the  word "manufacture" in Section 2(f) the  legislature intended to equate "processing" to  "manufacture" and intended to make mere  "processing" as distinct from "manufacture" in  the same sense of bringing into existence of a  new substance known to the market, liable to  duty. The sole purpose of inserting this  definition is to make it clear that at certain  places in the Act the word ’manufacture’ has  been used to mean a process incidental to the  manufacture of the article. Thus in the very  item under which the excise duty is claimed in  these cases, we find the words : "in or in  relation to the manufacture of which any  process is ordinarily carried on with the aid of  power". The definition of ’manufacture’ as in  Section 2(f) puts it beyond any possibility of  controversy that if power is used for any of the  numerous processes that are required to turn  the raw material into a finished article known  to the market the clause will be applicable;  and an argument that power is not used in the  whole process of manufacture using the word  in its ordinary sense, will not be available. It is  only with this limited purpose that the  legislature, in our opinion, inserted this  definition of the word ’manufacture’ in the  definition section and not with a view to make  the mere "processing" of goods as liable to  excise duty."

23.     Mr. Vellapally also submitted that there is no  deeming fiction in section 2(f)(i).  It is an inclusive  definition of manufacture and the test continues to be  whether there is a change in the essential character of  the goods and a new commodity emerges.  The same logic  applies with equal force to section 2(f)(ii).  There is no  deeming fiction in the said sub-section 2(f)(ii) and the  only effect of the said sub-section is that the goods are  considered manufactured at the stage when goods are  subjected to the processes mentioned in the Chapter  Notes of the Central Excise Tariff Act.  

24.     In the rejoinder, the learned Additional Solicitor  General reiterated the position that the products of the  respondent assessee have to be classified under Chapter  20 of the Central Excise Tariff Act.

25.     The learned Additional Solicitor General contended  that the deeming provision of section 2(f) (ii) was squarely

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raised at all levels of the proceedings. In the show cause  notice, section 2(f) has been invoked.  Similarly, in the  order in original, the Commissioner has categorically  relied upon Chapter Note 3 of Chapter 20 and section  2(f)(ii) and referred to various documents to strengthen  his case.  The  learned Additional Solicitor General has  also submitted that the Constitution Bench judgment of  this court in Delhi Cloth and General Mills (supra) is  not applicable in the instant case as the deeming  provisions of section 2(f)(ii) were not at all enacted during  the relevant period.  Section 2(f)(ii) was  incorporated/substituted in the Central Excise Act with  effect from 28.2.1986 vide MF (DR) Notification No.10 of  1986-Central Excise dated 5.2.1986.   

26.     It was submitted by the learned Additional Solicitor  General that the judgment of the Delhi Cloth and  General Mills (supra) was rendered on 12.10.1962 much  before enactment of the deeming provisions of section  2(f)(ii).  In these circumstances, this judgment can be of  no avail to the respondent assessee.   

27.     The learned Additional Solicitor General  further  submitted that the learned tribunal in the impugned  judgment has not at all considered the effect of section  2(f)(ii) of Chapter Note 3 of Chapter 20. He also  contended that the Sales Tax judgments relied upon by  the tribunal in the impugned judgment are not at all  relevant in deciding the issues in the present case.   According to him, the tribunal has not considered the  issue of classification.  According to his submission, in  view of the HSN notes and the judgment of this court in  Amrit Agro Industries (supra), the classification of the  products in question ought to be made only under  Chapter 20.

28.     We have heard the learned counsel for the parties  at length and carefully analysed the judgments cited at  the Bar.  The Central Excise Tariff Act is broadly based  on the system of classification from the International  Convention called the Brussels’ Convention on the  Harmonised Commodity Description and Coding System  (Harmonised System of Nomenclature) with necessary  modifications.  HSN contains a list of all the possible  goods that are traded (including animals, human hair  etc.) and as such the mention of an item has got  nothing to do whether it is manufactured and taxable or  not.

29.     In a number of cases, this court has clearly  enunciated that the HSN is a safe guide for the purpose  of deciding issues of classification.  In the present case,  the HSN explanatory notes to Chapter 20 categorically  state that the products in question are so included in  Chapter 20.  The HSN explanatory notes to Chapter 20  also categorically  state that its products are excluded  from Chapter 8 as they fall in Chapter 20.  In this view of  the matter, the classification of the products in question  have to be made under Chapter 20.

30.     The legal position has been clearly crystallized in  S.D. Fine Chemicals Pvt. Ltd. (supra) and other  judgments of this court that certain processes which may  not otherwise amount to manufacture have been deemed  to be manufacture by the Parliament under section

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2(f)(ii). Relevant portion of this judgment has already  been extracted in the preceding paragraphs.   

31.     In deciding the cases of this nature, the courts have  to make serious endeavour to ascertain spirits and  intention of the Parliament in enacting these provisions  and once the legislative intention is properly gathered,  then the bounden duty and obligation of the courts is to  decide the cases in consonance with the legislative  intention of the Parliament.

32.     In the instant case, for the comprehensive reasons,  as stated in the preceding paragraphs, it is crystal clear  that the products of the respondent assessee have to be  classified under Chapter 20 of the Central Excise Tariff  Act.

33.     As a result, the appeal of the appellant is allowed  and the impugned judgment of the tribunal is  accordingly set aside and the judgment of the  Commissioner of Customs & Central Excise, Goa is  restored.   

34.     Consequently, Civil Appeal Nos.7325-7326/01 filed  by M/s Coco Dry Fruits (India) Ltd. against the Revenue  are accordingly dismissed, upholding the order dated  24.8.2001 passed by the tribunal dismissing the appeals  of M/s Coco Dry Fruits (India) Ltd.

35.     Accordingly, Civil Appeal Nos. 7242-7243/02 filed  by M/s Coco Dry Fruits (India) Ltd. against the Revenue  are dismissed, upholding the order dated 10.12.2002  passed by the tribunal dismissing the appeals of M/s  Coco Dry Fruits (India) Ltd., but for adjudication the  question of penalty and interest, these appeals are  remanded to the Commissioner of Central Excise, New  Delhi.  

36.     In the facts and circumstances of the case, we direct  the parties to bear their own costs.