2015 (2) TMI 596 - AT - Customs

Waiver of predeposit - Classification of Coal - bituminous coal or steam coal - Held that - the chapter note has defined bituminous coal as having certain specifications, any coal satisfying the said definition merits classifications as bituminous coal , notwithstanding the fact that in commercial or other parlance it may be know otherwise. Since a final order of the Tribunal is available in this regard, classifying similar/identical goods under CTH 2701.12 as bituminous coal , we are of the considered view that at the interim stage the said final order of the Tribunal has to be followed. Further, we have in three instances followed to the said decision and have held that coal satisfying the definition under sub-heading note 2 to Chapter 27 would merit classification under 2701.12 as Bituminous coal . Therefore, as a matter of principle and discipline, we are bound to follow the said precedent 1981 (3) TMI 77 - SUPREME COURT OF INDIA , unless the same is set aside by a superior authority. Therefore, in the present case also, we are of the considered view that the coal imported by the appellant, prima facie, merits classification under CTH 2701.12 as bituminous coal . Consequently they would be liable to Customs duty under the said heading. Inasmuch as the assessments are provisional, the question of time bar would not arise. Therefore, the demand of duty confirmed in the impugned order prima facie appears to be sustainable in law, subject to reduction in duty liability, in view of the Indonesian origin of coal in terms of Notification No. 46/2011-Cus. No financial hardship has been pleaded nor any evidence placed before us in that regard. Therefore, the balance of convenience lies in favour of Revenue - Partial stay granted.

Summary

Issues:
Classification of imported coal as "Bituminous Coal" or "Steam Coal"
Applicability of Notification No. 46/2011-Cus for concessional rate of duty
Pre-deposit amount for stay petition

Classification of imported coal:
The appeal challenged an order confirming a Customs duty demand against the appellant for importing coal classified as "Bituminous Coal" under CTH 27011200, whereas the appellant claimed it should be classified as "Steam Coal" under CTH 27011920. The appellant argued that the agglomerating nature of coal is crucial for classification, citing ASTM standards. The Tribunal noted that coal meeting the definition of "bituminous coal" under sub-heading note 2 to Chapter 27 should be classified as such, regardless of commercial parlance. Previous Tribunal decisions supported this interpretation, leading to the conclusion that the imported coal prima facie qualified as "bituminous coal" under CTH 27011200, making it liable for Customs duty.

Applicability of Notification No. 46/2011-Cus:
The appellant contended that for two Bills of Entry with goods of Indonesian origin, they should receive the benefit of a concessional rate of duty under Notification No. 46/2011-Cus. The Tribunal acknowledged this possibility, estimating a reduction in duty liability by approximately Rs. 3 to 4 crore if the benefit was granted. However, no evidence of financial hardship was presented. The Tribunal directed the appellant to make a pre-deposit of Rs. 8.5 crore within eight weeks, considering the potential concession under the notification. Compliance would waive the balance of dues and stay recovery during the appeal.

Pre-deposit amount for stay petition:
In determining the pre-deposit amount for the stay petition, the Tribunal considered the potential concession under Notification No. 46/2011-Cus and directed the appellant to deposit Rs. 8.5 crore within eight weeks. Compliance would lead to the waiver of the balance of dues and stay on recovery during the appeal period. The Tribunal emphasized the importance of following precedent unless set aside by a superior authority, supporting the classification of the imported coal as "bituminous coal" under CTH 27011200.