2018 (5) TMI 518 - AT - Customs

Classification of imported goods - whether the goods are Knitted fabric or Netted fabric? - Held that - Clearly, if the party had asked for re-testing of the same, the same should have been done at a higher appellate level - first report dt. 28.02.2007 and second report dt. 04.10.2007 have indeed been prepared by the same officer whereas, as per para 13 of the Manual of Revenue Laboratories, if a party demands a re-test, the Chief Chemist is the appellate testing authority. The matter is remanded back to the adjudicating authority to get the goods re-tested at a higher appellate level - appeal allowed by way of remand.

Summary

Issues:
Classification of imported goods as Knitted fabric or Netted fabric; Adherence to testing guidelines; Appeal against duty demand and penalty imposition.

Analysis:
The appellant imported Nylon fabrics declared as Knitted fabric but were classified as Netted fabric by the Revenue. A show cause notice demanded duty and proposed confiscation of goods and penalty. The Adjudicating Authority confirmed the duty demand under Tariff Heading 58041090, imposed a redemption fine, and penalty. The Commissioner (Appeals) upheld the order. The appellant appealed, arguing that re-testing was not done by the Chief Chemist as required. The appellant also mentioned a subsequent report showing the fabric as Knitted but failed to provide the Bill of Entry number. The AR supported the Commissioner's findings.

Upon review, it was noted that the testing guidelines were not followed as the same officer conducted both initial and re-testing. The Chief Chemist should have been involved for re-testing as per the Manual of Revenue Laboratories. The matter was remanded to the adjudicating authority for re-testing at a higher appellate level, as prescribed in the manual. The adjudication should be done afresh, allowing the appellant a fair opportunity to present their case. All issues were kept open for further examination.

In conclusion, the appeal was disposed of by way of remand for re-testing at a higher level to ensure adherence to testing guidelines and fair adjudication process, allowing the appellant a chance to defend their case effectively.