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2015 (6) TMI 296 - HC - CustomsClassification of the products - electrical equipment - manufacture of Relays - whether subject products would fall within the classification as described in Sl. No. 112 of Exemption Notification No. 25/99, dated 28-2-1999, which states that the finished product if Relays/Switches/Connectors would be entitled to the Concessional rate provided that the importer follows the procedure set out in the said Rules - Held that - authority while passing the impugned order did not adjudicate the issue. The petitioner should have been permitted to agitate the classification issued by placing all materials and such issue could be decided after thorough adjudication. However, the procedure followed while passing the impugned order is a summary procedure. Even in the impugned order, it has been stated that the Department proposed to draw samples for the purpose of obtaining expert opinion. Therefore, the respondent by impugned proceedings have not finally adjudicated the issue or finalised the issue against the importer. However, the petitioner insisted on the certificate for availing the benefits under the exemption notification. This order has been passed on 6-5-2014 to safeguard the interest of the revenue by way of abundant caution pending final adjudication. - the observation made in the impugned proceedings, dated 6-5-2014 need not be put against the petitioner when the case is fully adjudicated by the Authority - Petition disposed of.
Issues:
Classification of imported goods for concessional duty under Customs Notification No. 25/99, dated 28-2-1999. Detailed Analysis: Issue 1: Classification of Imported Goods The petitioner, a Public Limited Company manufacturing electrical equipment, sought a writ to quash an order by the respondent regarding the classification of imported goods for concessional duty under Customs Notification No. 25/99. The petitioner applied for the import of parts for the manufacture of Relays under specific tariff items. The respondent raised concerns about the classification of the imported items and directed the petitioner to provide detailed information and technical write-ups. The respondent later refused to grant the certificate for concessional duty, pending expert opinion from IIT Chennai. The petitioner challenged this decision through a writ petition. Issue 2: Adjudication Process The High Court acknowledged that the classification issue could not be adjudicated by the Writ Court but needed to be decided by the authorities. The respondent produced an expert opinion post the impugned proceedings, indicating that the relays could be classified as simple trip/protection relays. It was noted that the authority did not conclusively adjudicate the issue, and the petitioner should have been given the opportunity to present all materials for a thorough adjudication. The court observed that the procedure followed by the respondent was summary in nature, and the impugned order was passed to safeguard revenue pending final adjudication. Conclusion: The High Court disposed of the writ petition by directing the respondent to issue a show cause notice to the petitioner, clearly outlining the facts and documents relied upon within two weeks. The petitioner was granted the opportunity to respond within two weeks, followed by a personal hearing within four weeks for the classification issue. All communications relied upon by the Department, including those sent to IIT Madras, were to be shared with the petitioner. The court emphasized that the observations made in the impugned proceedings should not be held against the petitioner until the issue is fully adjudicated.
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