2005 (10) TMI 407 - AT - Customs

Summary

Issues:
1. Declaration of imported goods as Stainless Steel Magnetic Scrap '400 grade'.
2. Confiscation and valuation of goods by Customs authorities.
3. Comparison of imported goods with goods of different grades.
4. Applicability of impugned order on the appellant's goods.

Analysis:
The appellant declared the imported goods as Stainless Steel Magnetic Scrap '400 grade'. However, upon examination by Customs authorities, it was found that the goods consisted of approximately 70% serviceable stainless steel sheets and 30% stainless steel scrap. The authorities concluded that the goods were not as per the declaration and confiscated them, also enhancing the assessable value. The appellant contended that they were actual users of the goods, intending to utilize them as inputs for manufacturing the final product after melting. They argued that the goods were of second grade and variable in length and thickness, distinct from goods of grades 430 and 409 used for comparison by the revenue. The appellant emphasized that they had availed credit for C.V. Duty paid on the imported goods, supporting their claim that the impugned order was not sustainable.

The Revenue argued that the sheets, ranging from 3' to 7' in length and 3' to 4' in width, could not be considered scrap as they were suitable for various purposes. They contended that the declaration of the goods as scrap was rightfully rejected. However, the Tribunal observed that the imported goods, despite being declared as scrap, were found to be of second grade upon examination. The goods consisted of a mix of stainless steel scrap and serviceable sheets, with varying lengths and thicknesses. The Tribunal noted that only 70% of the goods could be considered serviceable sheets for valuation purposes. Additionally, the imported goods were of 400 grade, not comparable to the grades 430 and 409 used for valuation enhancement. Considering the appellant's use of the goods in manufacturing their final product and their availing of credit for C.V. Duty paid, the Tribunal found merit in the appellant's contention. Consequently, the impugned order was set aside, and the appeals were allowed.