2013 (10) TMI 1106 - AT - Customs

Misdeclaration of Goods - Import of steel under advance authorization scheme - non-alloy steel or alloy steel. Notification No.21/2002 Classification of Goods - Waiver of Pre-deposit - The main appellant had mis-declared the description of the goods imported by them in order to avail in-eligible benefit of Notification No.21/2002 and also by mis-classifying the imported product under Chapter 7208 Held that - It can be seen from the records that the appellant had been making these declarations on various Bills of Entry and the details as given in invoice, were matching with the declaration made by the appellant - Based upon such declaration, it was to be noted that the appellant had not kept back any information from the Department and hence the claim of the appellant that the demand of duty is hit by limitation, seems to be on stronger wicket and needs consideration - Be that as it may, it was also undisputed that the item SAW pipes manufactured by the appellant had to conform to standard of American Petroleum Industry i.e. API and it should be manufactured only out of grade of stainless steel as indicated therein the appellant had made out a case for waiver of pre-deposit the amounts involved - Applications for waiver of pre-deposit of amounts involved were allowed and recovery stayed till the disposal of appeals Stay granted.

Summary

Issues Involved:
Waiver of pre-deposit of duty, interest, and penalties imposed due to mis-declaration of imported goods under Notification No.21/2002 and Chapter 7208.

Detailed Analysis:

1. Mis-declaration of Imported Goods:
The main issue in this case revolves around the mis-declaration of the goods imported by the appellant. The adjudicating authority found that the appellant mis-declared the description of the goods to avail ineligible benefits under Notification No.21/2002 and mis-classified the imported product under Chapter 7208. The appellant argued that they correctly classified the product in the Bills of Entry, imported the steel under the advance authorization scheme, used it in manufacturing SAW pipes, and exported the final products. The appellant contended that they provided all necessary certificates and that identical goods manufactured by an Indian company were classified under Chapter Heading No.7208. The appellant claimed that the revenue's dispute regarding classification was unfounded, as they had consistently declared the goods under Chapter Heading 7208 without challenge prior to the period in question.

2. Contentions of the Parties:
The appellant's counsel asserted that the appellant had not diverted any inputs, complied with all requirements, and had a consistent classification history. On the other hand, the Departmental Representative argued that the goods were mis-declared as non-alloy steel when they were actually alloy steel. The representative claimed that the mis-declaration was intentional to benefit from Notification No.21/2002 and that the advance licenses granted were for non-alloy steel, not alloy steel as imported by the appellant.

3. Judicial Analysis and Decision:
Upon reviewing the submissions and records, the Tribunal noted that the appellant had consistently declared the goods as Prime Hot Rolled Steel Coils (API 5L GR-X70, PSL-2) under Chapter 7208. The Tribunal found that the appellant had not withheld any information from the authorities and that the demand of duty might be time-barred. Additionally, the Tribunal recognized that the SAW pipes manufactured by the appellant needed to meet specific standards, and the issue was similar to a previous case where an unconditional stay was granted. Consequently, the Tribunal ruled in favor of the appellant, allowing the applications for waiver of pre-deposit and staying the recovery of amounts involved until the appeals were disposed of.

4. Operative Order:
The Tribunal granted the applications for waiver of pre-deposit and stayed the recovery of amounts involved until the appeals were resolved. Due to the substantial amounts at stake, the appeals were scheduled for disposal on a specified date to ensure timely resolution.

This comprehensive analysis highlights the key legal aspects and arguments presented in the judgment regarding the mis-declaration of imported goods and the subsequent waiver of pre-deposit sought by the appellant.