2003 (8) TMI 334 - AT - Customs

Summary

Issues: Classification of imported goods under Customs Tariff Heading 4403.49 or 4407.29, acceptance of loading value, imposition of redemption fine, and penalty.

Classification of Goods:
The case involved an appeal by the Revenue challenging the classification of goods imported by the Respondent. The importer declared the consignment as "roughly squared Ghana Teak Logs 1770 pcs." seeking clearance under Customs Tariff Heading (CTH) 4403.49. However, customs authorities, upon examination, classified the goods as sawn wood under CTH 4407.29 with a higher duty liability. The value of goods was increased based on past imports, resulting in a differential duty amount. The original authority confirmed the value increase and classification under CTH 4407.29, imposing a redemption fine and penalty. The importer appealed this decision before the Commissioner (Appeals).

Commissioner's Decision and Revenue's Appeal:
The Commissioner upheld the value enhancement but classified the goods under CTH 4403.49, reducing the redemption fine and penalty. The Revenue appealed this decision, arguing that the importer had accepted the physical verification as sawn wood in a letter, thus supporting the original classification. The Revenue contended that the Commissioner failed to consider the full context of the importer's letter. The Revenue also highlighted a previous misclassification of similar goods by the appellant, suggesting the need for correct classification despite past errors.

Appellate Tribunal's Analysis:
The Appellate Tribunal found merit in the appellant's contention, emphasizing that the importer's letter only agreed to loading value, not a change in classification. The Tribunal rejected the argument that the authorized person lacked the authority to agree to the classification, noting that the Director's endorsement did not dispute this agreement. Consequently, the Tribunal held that the Commissioner erred in concluding that the importer did not consent to the classification as sawn wood. The Tribunal reinstated the original authority's classification under CTH 4407.29, affirming the redemption fine and penalty reduction by the Commissioner.

Conclusion:
In conclusion, the Appellate Tribunal partially allowed the appeal, confirming the redemption fine and penalty reduction while reinstating the classification under CTH 4407.29. The Tribunal emphasized the correctness of the classification and the need to rectify past misclassifications, maintaining that the importer's agreement related only to the value loading, not the classification change.