2018 (1) TMI 1468 - AT - Customs

Mis-declaration of imported goods - Revenue entertained a view that the appellant has misdeclared the goods as re-rollable scrap falling under chapter heading 7204 whereas the goods were defective iron plates falling under chapter heading 7208 and attracting duty @ 10% - Held that - Admittedly the examination report has found the said goods to be defective iron plates of square or rectangular size with cut edges and of various thickness and lengths - In such a scenario the goods cannot be held to be prime or defective iron sheets and in the light of such variations in the sizes of the goods along with the fact that their edges were cut and worn out and the fact that they were in not serviceable for the purpose of sheets, it has to be held that the same are metal waste and scrap, which are admittedly not usable as such because of breakage, cutting up, wear-tear or other reasons. The goods can be used only by remelting the same and as such has to be held as being waste and scrap - there is no misdeclaration in the goods - appeal allowed - decided in favor of appellant.

Summary

Issues involved:
1. Misdeclaration of imported goods as re-rollable scrap under chapter heading 7204 instead of defective iron plates under chapter heading 7208.
2. Confiscation of goods and imposition of penalties due to alleged violations in import procedures.
3. Adjudication of whether the imported goods qualify as re-rollable scrap or as metal waste and scrap.

Detailed Analysis:
1. The appellant filed a Bill of Entry for import of goods declared as re-rollable scrap under chapter heading 7204, attracting a 5% duty. However, customs officers found the goods to be defective iron plates of varying sizes, shapes, and thickness, more appropriately classifiable under chapter heading 7208. The Revenue alleged misdeclaration and violation of import regulations, calling for confiscation and penalties.

2. The appellant explained that the goods were iron plates of different sizes, shapes, and thickness, with rough edges and old, contending them to be re-rollable scrap unsuitable for use as sheets. The original adjudicating authority confiscated the goods with an option for redemption on payment of a fine and imposed a penalty. The Commissioner (Appeals) upheld this decision, leading to the present appeal.

3. Upon review, the Tribunal found the goods to be defective iron plates with cut edges, varying sizes, and unsuitable for use as sheets due to wear and tear. Considering the characteristics of the goods, including breakage and wear, the Tribunal concluded that they qualify as metal waste and scrap, usable only through remelting. Consequently, the misdeclaration allegation was dismissed, and the impugned orders for confiscation and penalties were set aside, allowing the appeal with consequential relief.