2016 (12) TMI 1311 - AT - Customs

Import of restricted item - classification of imported goods in dispute - confiscation - whether the imported goods were Rubber Crumb under CTH 4017 00 90 or were ground waste of vulcanized rubber tyre powder under CTH 40040000 and is restricted item for import? - Held that - The entry under CTH 4017 reads as Hard rubber (for example, ebonite) in all forms, including waste and scrap; articles of hard rubber. - The Commissioner (Appeals) has rejected the said claim of classification of the goods under CTH 4017 00 90 as the goods imported were other than hard rubber according to the test report. He classified the goods under CTH 40040000 waste, parings and scraps of rubber (other than hard rubber) and powders and granules obtained therefrom. The appellants have not produced any evidence to contradict the test report - Since the goods under CTH 4004 are Restricted and needs license for import of the same, there is also no infirmity in holding the goods liable to confiscation - redemption fine reduced to ₹ 15,000/- on fair consideration - penalty also waived - appeal partly allowed - decided partly in favor of appellant.

Summary

Issues: Classification of imported goods under CTH 4017 00 90, confiscation of goods under CTH 40040000, imposition of redemption fine and penalty.

In this case, the appellants imported 'Rubber Crumb' and filed a Bill of Entry for clearance. The Department requested various documents, including a manufacturer's analysis certificate, which the appellants failed to provide. The goods were intended for use as raw material for manufacturing Crumb Rubber Modified Binder. The Chemical Examiner's test report indicated that the imported goods were ground waste of vulcanized rubber tyre powder. The Department classified the goods under CTH 40040000 instead of CTH 4017 00 90 as declared, citing restrictions under Exim Policy 2004-09. The Additional Commissioner of Customs classified the goods under CTH 40040000, confiscated them, and imposed a redemption fine of ?10 Lakh along with a penalty of ?50,000. The Commissioner (Appeals) upheld the classification and confiscation but reduced the redemption fine to ?1 Lakh and waived the penalty.

Upon review, the Appellate Tribunal observed that the goods did not qualify as 'hard rubber' under CTH 4017, as per the test report, and were correctly classified under CTH 40040000. The Tribunal noted that since the goods under CTH 4004 were restricted and required a license for import, the confiscation was justified. The Tribunal agreed with the Commissioner (Appeals) on the classification issue and the reduction of the redemption fine to ?1 Lakh. However, considering the circumstances, the Tribunal further reduced the redemption fine to ?15,000. Consequently, the impugned Order-in-Appeal was upheld, with the appeal being allowed partially by reducing the redemption fine.