2017 (1) TMI 913 - AT - Customs

Classification of imported crude palm oil - classifiable under Chapter Heading 1511100 or under 15119090 - the goods which are imported are classifiable under 1511 and the CRCL report clearly records that the sample is raw grade palm oil - Held that - raw grade palm oil would mean it is crude oil and merits classification under 15111000 and not under 15119090, as crude palm oil which is imported and declared as such. The carotenoid value decreases when the samples are transported for the analysis purposes and there is a delay in testing of samples - there is a delay of 14, 18 and 38 days in testing the samples by the authorities concerned, which would definitely affect the carotenoid value in the sample. The appellant is eligible for the benefit of reduced rate of customs duty as per N/N. 21/2002-Cus. as the products imported by them are classifiable under chapter heading 15111000 - appeal allowed - decided in favor of appellant.

Summary

Issues: Classification of imported crude palm oil (CPO) under Chapter Heading 1511100 for concessional duty rate.

Analysis:
1. The issue in this case revolves around the classification of crude palm oil (CPO) imported by the appellant. The appellant sought clearance of CPO under Chapter Heading 1511100 to avail the benefit of a concessional rate of duty. However, the samples drawn and tested indicated that the carotenoid value was below the prescribed limit, leading to a dispute over the classification of the imported goods.

2. The adjudicating authority held that the goods imported were not CPO and should be classified under 15119090, resulting in a higher duty rate. The appellant contested this decision, arguing that the delay in testing the samples caused a decrease in the carotenoid value, affecting the classification. The appellant relied on previous case law and decisions to support their claim.

3. The appellate authority upheld the adjudicating authority's decision, stating that the appellant did not challenge the test report or request a second test. The appellant's counsel argued that the delay in testing the samples was crucial, citing a previous Tribunal case where a similar delay led to a favorable decision for the importer.

4. Upon reviewing the records and tariff entries, the Tribunal agreed with the appellant's contention that the imported goods should be classified under 15111000 as raw grade palm oil, which is synonymous with crude oil. The Tribunal acknowledged that the delay in testing the samples indeed impacted the carotenoid value, as established in previous case law.

5. Consequently, the Tribunal ruled in favor of the appellant, holding that they were eligible for the reduced rate of customs duty under Notification No.21/2002-Cus. The impugned order was set aside, and the appeal was allowed in favor of the appellant.