2016 (12) TMI 636 - AT - Customs

Classification of imported goods - old and used mainframes - classified under CTH 90099900 as part of photocopier machine or under CTH 90091200 as Electrostatic Photocopying Apparatus? - goods liable for confiscation on the ground that these are old and used mainframes were to be treated as photocopier that all second hand goods except second hand capital goods are restricted for imports as per para 2.17 of the Foreign Trade Policy (2004-2009) and required specific import licence. As the respondent was not having import licence, therefore, the goods were held liable for confiscation - Held that - we find that the Chartered Engineer has given certificate where it has been pointed with the mainframe of photocopier machine were found to be incomplete set of machine parts, some components i.e. Trolleys, main Mother Boards, Paper Deck, lamp Regulators were not found. Therefore, these are the parts of main frame assembles and the said missing parts are required to complete the photocopier machine. The said report of the Chartered Engineer has not been disputed by Vs. Ltd the adjudicating authority nor in the appeal, therefore, we hold that the Ld. Commissioner (A) has correctly classified the goods in question as part of photocopier machine and under CTH 90099900 - appeal dismissed - decided against Revenue.

Summary

Issues: Classification of imported goods under Customs Tariff Heading (CTH) 90099900 or 90091200, confiscation of goods for lack of import license.

Classification Issue:
The case involved a dispute over the classification of imported goods declared as old and used mainframes of photocopier assemblies. The adjudicating authority classified the goods under CTH 90091200 as Electrostatic Photocopying Apparatus, enhancing the assessable value and holding the goods liable for confiscation due to being old and used mainframes. The Ld. Commissioner (A) later classified the goods under CTH 90099900 as parts and components of a photocopier machine. The Tribunal analyzed a Chartered Engineer's report, which confirmed that certain components were missing from the mainframe, making it incomplete and requiring those parts to function as a photocopier machine. The Tribunal upheld the Ld. Commissioner (A)'s classification, concluding that the goods were rightly classified as part of a photocopier machine under CTH 90099900. The Tribunal found no fault in the impugned order and dismissed the Revenue's appeal.

Confiscation Issue:
The goods were also held liable for confiscation due to being old and used mainframes, which were considered as photocopiers and required a specific import license as per the Foreign Trade Policy. Since the respondent did not possess the necessary import license, the goods were confiscated. However, the Ld. Commissioner (A) classified the goods as parts and components of a photocopier machine, leading to the appeal by the Revenue. The Tribunal's decision on the classification issue also resolved the confiscation matter, as the correct classification under CTH 90099900 meant that the goods were not subject to confiscation. The Tribunal upheld the Ld. Commissioner (A)'s classification, thereby dismissing the Revenue's appeal and confirming that the goods were not liable for confiscation.

This judgment clarifies the importance of accurate classification of imported goods under the Customs Tariff Heading and the implications it has on potential confiscation issues. The Tribunal's reliance on expert reports and legal provisions highlights the significance of thorough analysis in resolving classification disputes and associated consequences like confiscation.