2017 (1) TMI 343 - AT - Customs

Benefit of N/N. 39/90-Cus., dated 20-3-1990 - import of Ethyl Glycol - denial on the ground that ethyl glycol imported by them is rightly classifiable under Heading 29.09 and not under Heading 29.05 - Held that - both the sides are not disputing that ethyl glycol is classifiable under Heading 29.09. We find that the heading mentioned in entry No. 8 under N/N. 39/90-Cus. is 29.05. In these circumstances, if the view taken by Revenue is accepted, the entry No. 8 itself will become redundant. The facts that the Heading 29.05 was replaced by Chapter 29 vide Notification No. 144/91-Cus., points to the fact that there was an error, which was corrected on a later date - the benefit of Notification No. 39/90 cannot be denied to the appellant - appeal allowed - decided in favor of appellant.

Summary

Issues: Classification of imported goods under Notification No. 39/90-Cus.

Analysis:
The appellant, M/s. Franco-Indian Pharmaceuticals Pvt. Ltd., imported Ethyl Glycol and classified it under sub-heading 2909.49, seeking benefits under Notification No. 39/90-Cus. However, the benefit was denied by lower authorities, claiming that ethyl glycol should be classified under Heading 29.09, not 29.05. The main issue is whether the appellant is entitled to the benefits under Notification No. 39/90-Cus. despite the discrepancy in the heading mentioned.

Argument by Appellant:
The counsel for the appellant argued that ethyl glycol is specifically covered by name in Notification No. 39/90-Cus., even though the wrong heading, 29.05, was mentioned. The counsel contended that since the product is explicitly named in the notification, the benefit cannot be denied based on a technical error. Moreover, the counsel highlighted that the replacement of Heading 29.05 by Chapter 29 through Notification No. 144/91 indicates a correction of an error, and denying the benefit would render the entry redundant.

Revenue's Argument and Tribunal's Analysis:
The learned Assistant Commissioner relied on the lower authorities' decision. However, the Tribunal analyzed the submissions from both sides and noted that ethyl glycol is classifiable under Heading 29.09, not 29.05. Despite the discrepancy in the heading mentioned in the notification, the Tribunal observed that if the Revenue's view is accepted, the entry itself would become redundant. The Tribunal concluded that the correction made through Notification No. 144/91 from Heading 29.05 to Chapter 29 signifies an error rectification, and thus, the benefit of Notification No. 39/90-Cus. cannot be denied to the appellant. Consequently, the appeal was allowed in favor of the appellant.

This judgment highlights the importance of substance over form in interpreting legal provisions, ensuring that the intended benefits are not denied due to technical errors in classification.