2015 (10) TMI 187 - AT - Customs

Classification of POP-POP Party snappers Whether explosive goods or not Revenue filed appeal against order in respect of goods namely POP-POP Party snappers which were absolutely confiscated by adjudicating authority holding them to be classifiable under CTH 36041000 as fire crackers restricted for import as per F.T.P. 2009-14 and prohibited under Rule 7 & Rule 8 of Explosive Rules 2008 Hence requiring for import thereof permission/authorization from DGFT and Explosive Department which respondents did not produce Commissioner (A) vide impugned order agreed with contention of Respondents by classifying goods under CTH 9505 Held that - As evident from report of CRCL they have not given any definite opinion whether impugned goods would fall in category of Explosives Neither CRCL nor Controller of Explosives has given opinion whether impugned goods would fall in category of explosives subject to various restrictions relating to explosives Thus original adjudicating authority has clearly erred in stating that his basis of classification of impugned goods under CTH 36041000 is CRCL report Commissioner (A) concluded that impugned goods would not fall under category of fireworks merely on ground that impugned goods contain very small quantity of silver fulminates This can not be held to be sustainable basis to so conclude specially in respect of goods which contain material covered under Explosive Act, 1884 Thus both adjudicating authorities have gravely erred in deciding way they have decided case Matter remanded to primary authority to pass de novo order Impugned order set aside Appeal disposed of.

Summary

Issues: Classification of goods under CTH 36041000 or CTH 9505, Misinterpretation of CRCL report, Errors in decisions by original adjudicating authority and Commissioner (Appeals), Urgency in resolving the matter, Directions for further testing and adjudication, Permission for destuffing and storage of goods.

In this case, the appeal was filed against the confiscation of "POP-POP Party snappers" by the original adjudicating authority, classifying them under CTH 36041000 as firecrackers restricted for import. The respondents argued for classification under CTH 9505 for entertainment articles. The Commissioner (Appeals) agreed with the respondents, setting aside the original order. The CRCL report did not definitively classify the goods as explosives, recommending further testing. The Controller of Explosives suggested testing the goods, which revealed they contained a small amount of silver fulminate. Both authorities erred in their decisions as they were not based on solid grounds. The Tribunal remanded the case to the Adjudicating Authority for testing by the Explosives Department and subsequent adjudication within specific timeframes.

The Tribunal found errors in the decisions of both the original adjudicating authority and the Commissioner (Appeals) due to the lack of a definitive classification of the goods as explosives. The urgency to resolve the matter was highlighted, considering the goods were held up at the port since 2013. The Tribunal directed the Adjudicating Authority to request testing by the Explosives Department promptly and provide copies of the test report to the respondents for their submissions. The Adjudicating Authority was instructed to pass a new order within six weeks after the receipt of the Tribunal's order, allowing the respondents to destuff and store the goods during the process to avoid demurrage charges.

Overall, the judgment focused on the correct classification of the goods, emphasizing the need for proper testing by competent authorities to determine if the goods fell under the category of explosives. The Tribunal highlighted the errors in the previous decisions and provided detailed directions for further testing and adjudication to ensure a fair resolution of the matter.