In Brief
The Supreme Court was divided on whether coconut oil in small consumer packages should be classified as edible coconut oil (Chapter 15, duty 8%) or as a hair preparation (Chapter 33, duty 16%). Justice Gogoi held that small-packaged coconut oil remains edible oil under Chapter 15, as the HSN nomenclature forms the basis of tariff classification and the product lacks the required labeling/specialization for hair-use classification. Justice Banumathi held that post-2005 amendments to Chapter Note 3 and Section Note 2 mandated classification as hair oil when goods are suitable for retail hair-use packaging, and that the Common Parlance Test supports viewing coconut oil as primarily a hair oil in most of India. The bench remained split with conflicting judgments.
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