2016 (12) TMI 641 - AT - Customs

Fe fines exported - Department took the view that such consignments having Fe content of more than 64% was in restricted category as per the FTP 2007-08 and shall be exported only through state trading enterprises viz. MMTC Ltd. - whether confiscation of goods, and imposition of fines and penalties justified? - Held that - In the light of the Board s Circular No.4/2012-Cus. dt. 17/02/2012, the issue is now stands gone in favour of the appellant. in the circumstances, the appeals filed by the exporters are required to be allowed in toto and we order accordingly. For the same reasons, Department s appeals (C/508, 509/2009) cannot succeed and will have to be dismissed, which we hereby do. The appeal Nos. C/533/2009 and C/534/2009 are allowed with consequential reliefs, if any.

Summary

Issues:
1. Fe fines exported by M/s. Obulapuram Mining Co. Pvt. Ltd.
2. Interpretation of FTP 2007-08 regarding Fe content restrictions for export.
3. Confiscation of iron ore consignments and imposition of penalties under Customs Act, 1962.
4. Validity of Board's Circular No.4/2012-Cus. dt. 17/02/2012 on assessment of Fe content for export duty.
5. Correct methodology for determining Fe content for export purposes.

Analysis:
The appeals before the Appellate Tribunal CESTAT Hyderabad involved the export of Fe fines by M/s. Obulapuram Mining Co. Pvt. Ltd. The issue centered around the Fe content of the exported consignments, with the Department contending that consignments with Fe content exceeding 64% fell under a restricted category per FTP 2007-08. The Department had ordered confiscation of the iron ore consignments and imposed penalties under the Customs Act, 1962, leading to the appeals.

During the hearing, the appellant's counsel highlighted Board Circular No.4/2012-Cus. dt. 17/02/2012, which clarified the methodology for assessing Fe content for export duty purposes. The Circular emphasized assessment on a Wet Metric Ton (WMT) basis to determine net Fe content accurately. The counsel argued that testing on a dry basis without considering impurities did not reflect the correct percentage for FTP compliance.

The Tribunal considered the arguments and the Board's Circular, which favored the appellant's position. Consequently, the Tribunal ruled in favor of the exporters, allowing their appeals in full. The Department's appeals were dismissed as they could not succeed in light of the Circular. The Tribunal's decision was based on the correct assessment methodology for Fe content as per the Circular, providing consequential reliefs to the appellants.

In conclusion, the judgment clarified the assessment methodology for determining Fe content for export duty, emphasizing the importance of following the guidelines set forth in the Board's Circular. The decision highlighted the significance of accurate assessment to ensure compliance with export regulations and upheld the appeals of the exporters based on the correct interpretation of the relevant provisions.