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Issues: Classification of imported goods under the Customs Act, 1962; Refund of duty on imported goods; Interpretation of "Ore" vs. "Chemical" classification.
In this case, the appellants imported Manganese Dioxide and claimed a refund of duty, arguing that the goods should have been classified as unprocessed ore under Item 26 of the Indian Customs Tariff (ICT) instead of chemicals under Item 28. The Assistant Collector and Appellate Collector classified the goods as chemicals based on their form as coarse powder. The appellants contended that the imported ore had not undergone chemical processing, relying on supplier certificates and past decisions. The Department argued that the ore was battery grade, indicating special treatment. The Supreme Court precedent regarding the classification of metallic ores emphasized that ore in powder form does not automatically classify as a chemical. The Tribunal held that the lower authorities erred in classifying the ore based solely on its powder form, as there was no evidence of chemical treatment to change its nature from ore to chemical. Additionally, a past government decision supported classifying battery grade Manganese Dioxide as ore under Item 26 of the ICT. Consequently, the Tribunal allowed the appeal, directing the classification of Manganese Dioxide under Item 26 and granting a refund of duty.
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