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2017 (5) TMI 1281 - AT - CustomsClassification of imported goods - Rubber Process Oil - whether hazardous goods or not? - whether the goods are classifiable under chapter sub heading 2707 9900 as canvassed by the revenue or 2710 1960 as canvassed by the Appellants or under 2713 9000 as alternatively pleaded by the Appellants? - Held that - Once the laboratory is accredited to such test and secondly they have tested the parameters as asked by the revenue, the objection raised by the revenue, which are even not sustainable in view of our observations, are not correct. - the goods being non hazardous and the PAH being in the accepted levels are eligible for importation. Regarding classification - The Chapter subheading 27.13 covers Petroleum Coke, petroleum bitumen and other residues of petroleum oils or of oils obtained from bituminous minerals. The imported goods RPO cannot be classified under chapter sub heading 27.07 as it is not applicable to residues of petroleum oils or of oils obtained from bituminous minerals. Further even as per the HSN Explanatory Notes to said chapter the correct classification would be under chapter sun heading 271390 00. The more specific tariff heading is ought to be assigned to the goods in case if two headings are equally applicable. We therefore hold that the raw RPO imported by the Appellants would merit classification under chapter heading 2713.90 and would be liable to duty accordingly. Extended period of limitation - Held that - the issue involved is grave interpretation of Iaw that whether goods in question is hazardous or otherwise and also involved issue on classification. The outcome of the case is based on strict laboratory tests of various agencies, hence it can not be expected from the appellants that they know the nature of imported goods, accordingly, the impression of facts cannot be attributed to the appellants - extended period not invocable. The impugned goods be classifiable under chapter subheading 27139000 and the same shall be assessed accordingly - confiscation and demand set aside - appeal allowed - decided in favor of appellant.
Issues Involved:
1. Classification of Rubber Process Oil (RPO). 2. Determination of hazardous nature of the imported RPO. 3. Legality of duty demands and penalties imposed. 4. Invocation of extended period of limitation for demands. Issue-wise Detailed Analysis: 1. Classification of Rubber Process Oil (RPO): The primary issue was the classification of RPO imported by the appellants. The adjudicating authority classified the RPO under CTH 27079900, whereas the appellants argued for classification under CTH 27101960 or alternatively under CTH 27139000. The Tribunal found that the raw RPO, which is a residue from the treatment of lubricating oils, should be classified under CTH 27139000 as "other residues of petroleum oils or of oils obtained from bituminous materials." This classification was supported by the Deputy Chief Chemist and CBEC Circular No.11/1989, and the CRCL's communication dated 23.08.2013. 2. Determination of Hazardous Nature of the Imported RPO: The adjudicating authority based its decision on the CRCL report, which indicated high aromatic content and classified the RPO as hazardous waste. However, the appellants contested this, leading to retesting by independent laboratories. The Hon'ble High Court directed retesting by M/s Ashwamedh Engineers & Consultants, which reported the RPO as non-hazardous. The Tribunal also directed testing by M/s Sky Lab Analytical Laboratory, which confirmed the non-hazardous nature of the RPO. The Tribunal found the independent reports reliable and concluded that the RPO was non-hazardous, rejecting the CRCL's findings due to lack of proper methodology and transparency. 3. Legality of Duty Demands and Penalties Imposed: The adjudicating authority had imposed duty demands and penalties based on the classification under CTH 27079900 and the hazardous nature of the RPO. However, given the Tribunal's findings that the correct classification was under CTH 27139000 and the RPO was non-hazardous, the basis for the duty demands and penalties was invalidated. Consequently, the Tribunal set aside the duty demands and penalties imposed on the appellants. 4. Invocation of Extended Period of Limitation for Demands: The demands were raised by invoking the extended period of limitation, alleging suppression of facts by the appellants. The Tribunal found that the appellants had been regularly importing RPO, and previous consignments were tested and cleared by customs authorities. There was no evidence of suppression or intent to evade duty. The Tribunal noted that the issue involved complex legal interpretations and laboratory tests, which could not be attributed to the appellants' knowledge. Thus, the invocation of the extended period of limitation was deemed unsustainable. Conclusion: The Tribunal allowed the appeals, setting aside the confiscation of goods, duty demands, and penalties. It held that the imported RPO should be classified under CTH 27139000 and assessed accordingly. The demands raised by invoking the extended period of limitation were also found to be unsustainable. The appellants were granted consequential reliefs in accordance with the law.
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