2018 (7) TMI 541 - AT - Customs

Import of Crude Palm Oil - concessional rate of duty - N/N. 21/2002-Cus dated 1st March 2002 - Case of appellant is that the denial of the benefit of concessional notification is improper as the test result determining content of beta carotene below the lower in the said notification was not valid because that samples were tested belatedly, during which time the beta carotene disipates - Held that - The imported goods are crude palm oil. Considering that the appellant had laid claim to eligibility for the concessional rate of duty, it was not the responsibility of the assessee to draw samples and to send it promptly for testing to ascertain the correctness of the declaration of intimation. That was the responsibility of the assessing officer. Having failed to do so, it cannot transfer the liability of ascertainment to the appellant and, on the basis of result of an invalid test, to fasten the duty liability on the importer - the reliance placed on the test report which emanated long after the date of import does not sustain in the absence of any other evidence that imported goods were refined palm oil. Appeal allowed - decided in favor of appellant.

Issues: Eligibility for concessional rate of duty under notification no. 21/2002-Cus dated 1st March 2002 on import of crude palm oil against 39 bills of entry.

Analysis:
1. The issue in this appeal revolves around the eligibility for the concessional rate of duty under a specific notification for the import of crude palm oil against 39 bills of entry. The goods were cleared provisionally pending the receipt of test reports regarding beta carotene content. The original authority finalized the assessment based on the test reports, leading to a duty liability determination in two sets of proceedings. The Commissioner (Appeals) rejected the claim for the concessional rate of duty, prompting the appeal. The appellant argued that the denial was improper due to delayed testing affecting the beta carotene content, citing a Tribunal decision in a similar case.

2. The appellant contended that the test results determining beta carotene content below the required range were invalid as the samples were tested belatedly, leading to a dissipation of beta carotene. The appellant presented scientific findings indicating that beta carotene levels decrease over time due to various factors like temperature variations. Moreover, a letter from the Ministry of Consumer Affairs highlighted concerns regarding the stipulation of carotenoid content in crude palm oil for import, suggesting that such requirements may not be necessary due to the refining process. The Tribunal's decision in a related case was also cited to support the argument that delayed chemical analysis may not serve the intended purpose.

3. The Revenue disputed the appellant's claim for concessional rate of duty, arguing that there was no evidence of compliance with beta carotene content requirements in the imported consignment. The Revenue contended that relying on a previous Tribunal decision was not acceptable as the importer in that case had provided proof of beta carotene content at the time of import. The Revenue further argued that beta carotene content reduction overnight would eliminate such content during testing, questioning the validity of the appellant's claims.

4. Upon evaluating the submissions and records, it was established that beta carotene is eliminated during the transformation from crude to refined palm oil. This elimination is a natural part of the refining process, which incentivizes value addition in India by offering concessional rates only for crude palm oil. The Tribunal found that beta carotene does not persist in crude palm oil for an extended period and that the imported goods in question were indeed crude palm oil, as they had not undergone refining. The responsibility of verifying compliance fell on the assessing officer, and the lower authority's findings were overturned due to lack of evidence supporting the claim that the goods were not crude palm oil.

5. Consequently, the reliance on delayed test reports was deemed insufficient to establish that the imported goods were not crude palm oil, and the impugned order was set aside, allowing the appeal in favor of the appellant.

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