2017 (3) TMI 1629 - AT - Customs

Classification of goods - imported sports shoes from Nepal - whether classified under CTH 6401.10, which is meant for footwear of retail sales price not exceeding ₹ 125/- per pair, with Nil rate of duty or under CTH 6401.19 as other footwear liable to Customs duty. Held that - in the absence of evidence to the effect that the imported goods are actually having retail sale price of below ₹ 125/- per pair in terms of Section 4A of the Central Excise Act, 1944, we find the assessment and payment of duty under the Heading 6401.19 cannot be varied - retail sale price has to be evidenced by declaration of price affixed on the goods in question and not by any other document. Appeal dismissed - decided against appellant.

Summary

Issues:
Classification of imported sports shoes under Tariff Heading 6401.10 or 6401.19 for Customs duty.

Analysis:
The appellant imported sports shoes from Nepal and claimed classification under Tariff Heading 6401.10, which carries a Nil rate of duty for footwear with a retail price not exceeding ?125 per pair. However, the Revenue argued for classification under 6401.19, which attracts Customs duty. The appellant paid duty under protest, declaring retail prices of ?123 and ?99 for the footwear, and sought exemption from additional Customs duty. The appellate authority rejected their refund claims, leading to the present appeal.

The key point of contention was the classification based on retail sale price, as it determines the additional duty of customs. The Revenue contended that the retail sale price, as per Section 4A of the Central Excise Act, 1944, should not exceed ?125 per pair. They argued that the MRP should be established by the product label, not by any other evidence, thus rejecting the appellant's claims.

Upon review, the Tribunal noted that establishing the retail sale price is crucial for classification. The retail sale price must comply with the provisions of the Legal Metrology Act, 2009, and be affixed as per the Act's rules. Merely declaring prices in invoices or by importers is insufficient to determine the retail sale price. Despite the appellant's protest in the Bill of Entry and the absence of subsequent resolution or evidence supporting the protest, the Tribunal found it impractical to resolve the issue after almost 9 years. Without concrete evidence proving the footwear's retail sale price below ?125 per pair, as required by the Central Excise Act, the assessment and duty payment under Heading 6401.19 could not be altered. The Tribunal emphasized that the retail sale price must be evidenced by the price affixed on the goods, not by any other document.

Ultimately, the Tribunal dismissed the appeal, finding no merit in the appellant's arguments due to the lack of evidence supporting the claimed retail sale prices below the specified threshold.