2014 (2) TMI 782 - AT - Customs

Classification of goods - un-alloyed or non alloy steel - classifiable under Chapter 72.28 or under Ch. 72.13 - overriding effect of Chapter Notes - CVD exemption under S No 202A of exemption Notification No. 21/2002-cus - Held that - As per the above parameters any steel, having %age weight of any element (except sulphur , phosphorous, carbon and nitrogen) more than the limits specified in this chapter note, will be classified as other alloy steel . As per the test got done by the Revenue the %age of Vanadium in the imported steel is 0.1% or more which is covered by the parameters specified in Chapter Note 1(f) of chapter 72 of the customs Tariff Act. There is no mention in the chapter notes to Chapter 72 that for interpreting the classification of steels specified in the customs Tariff, BIS standards should be followed. Taking of the lowest value of a range, with respect to test reports will arise only when several samples of a uniform lot give different test reports, as was the case where test reports were given by the National Metallurgical Laboratory, Madras Centre. In all those appeals where samples of TMT bar tested showed uniform dimensions and it was opined that lowest of the test reports was taken to hold the steels in those cases to be non-alloy steel . In the case of the appellant there is no point of taking lowest of the range of any values. In the case of the appellant, the quantity of Vanadium, as determined in the tests got conducted by the Revenue, was 0.1% or more as specified in the Chapter Note 1(f) of Chapter 72 and accordingly imported goods have been correctly held to be classifiable under CTH 72.28 by the lower authorities. Separate value of 16mm, 20mm, 25mm and 32mm has not been made available, hence separate duty cannot be assessed for 16mm steel bars . Nott. No. 21/2002 cus exempts both the basic customs duty and CVD under different serial numbers of an exemption notification and the CVD rate applicable to the goods imported by the appellant will be as per Sr No. 202A of Nott. No. 21/2002-cus dated 1/3/2002. - Decided in favour of assessee.

Summary

Issues:
Classification of imported goods under CTH 72.28 as 'other alloy steels'; eligibility for various exemptions including CVD exemption and Nil rate of SAD; interest liability determination.

Classification of Goods:
The main issue in this case was the correct classification of the goods imported by the appellant. The Revenue argued that the goods should be classified under Chapter 72.28 as 'other alloy steels' based on the percentage weight of alloying elements exceeding the limits specified in Chapter Note 1(f) of the Customs Tariff Act. On the other hand, the appellant contended that the goods should be classified as unalloyed or non-alloy steel under Ch. 72.13, eligible for exemption, as the percentage weight of elements was below the limits specified in the BIS standard IS 7598:1990. The appellant emphasized that the lowest value of the range should be considered for classification, citing the case of M/s DLF Infocity Developers (Chennai) Ltd. The Tribunal analyzed the parameters for 'other alloy steel' as per Chapter Note 1(f) and concluded that the imported goods, with Vanadium percentage of 0.1% or more, fell under this classification, rejecting the appellant's argument based on BIS standards.

Eligibility for Exemptions:
The appellant also sought various exemptions, including CVD exemption under Sr No. 202A of Notification No. 21/2002-cus and Nil rate of SAD under Notification No. 20/2006. The Tribunal examined the provisions of the relevant notifications and previous judgments. Regarding the CVD exemption, the Tribunal clarified that the benefit should be granted as per Sr No. 202A of the notification, emphasizing that the ratio of a previous judgment relied upon by the Adjudicating Authority did not apply to the current situation. The Tribunal also noted that certain issues raised by the appellant were not brought up before the lower authorities or in the grounds of appeal, therefore, they could not be considered at the final hearing before CESTAT for the first time.

Interest Liability Determination:
Lastly, the appellant raised the issue of interest liability, arguing that any liability should be fixed from the date of passing the OIO due to the department's delay in finalizing provisional assessments. However, the judgment did not provide a specific resolution or decision on this particular issue, focusing primarily on the classification of goods and eligibility for exemptions.

In conclusion, the Tribunal allowed the appeal of the appellant to the extent indicated in the judgment, emphasizing the correct classification of the imported goods under 'other alloy steels' and the eligibility for specific exemptions as per the relevant notifications and legal interpretations. The decision highlighted the importance of adherence to statutory provisions and established principles in determining the classification and treatment of imported goods under the Customs Tariff Act.