2024 (1) TMI 590 - AT - Customs

Change of classification of goods imported by the appellant - Non-declaration of MRP - Applicability of Notification 9 of 2010 CE (NT) dated 27.02.2010 which amends notification no. 49/2008 Central Excise NT dated 24.12.2008 - Suppression of facts or not - penalty - extended period of limitation - HELD THAT - On perusal of the nature of goods show that radiator, evaporator, condenser or compressor or all essential ingredients refrigeration system and can by no means the called accessories. The decision of Banco Products India Ltd. 2009 (2) TMI 101 - CESTAT AHMEDABAD is different sides of facts. In the said case the goods in dispute were not essential ingredients of the final product. Penalty - suppression of facts or not - HELD THAT - There was no mis-declaration of description. He argued that in these circumstances, penalty should not be imposed. We find that penalty of Rs.50,000/- has been imposed under section 114 AA of the Customs Act, 1962. The penalty of Rs. 50,000/- has been also imposed under section 112(a) of the Customs Act, 1962. Extended period of Limitation - HELD THAT - The show cause notice has been issued on 13.04.2018 whereas, the bill of entries are dated 26.07.2016 to 13.08.2016. It is seen that all the data required for the notice except the MRP was available in the bill of entry filed by the appellant. In these circumstances, there are no reason to hold that anything was suppressed by the appellant for the purpose of evasion. The description of the goods the heading in which classification has been claimed and the rate of duty for the purpose of CVD and the value for the purpose of CVD are all available on the bill of entries - it is not found that revenue has been able to establish the case for revocation of extended period of limitation. The extended period of limitation could not have been involved in the instance case. This appeal is therefore allowed on the ground of limitation.

Summary

Issues involved:
The appeal involves the classification of imported goods under heading 8708, demand of countervailing duty based on MRP, applicability of penalty under section 114(AA) of the Customs Act, 1962, and whether the goods are accessories or parts of vehicles.

Classification of Goods and MRP Based Assessment:
The appellant imported goods seeking classification under heading 8708 without declaring the MRP. The revenue sought reassessment of past bill of entries for countervailing duty based on MRP, invoking interest and penalty provisions. The appellant argued that the goods imported are parts of air conditioners, not vehicles, and therefore not covered under notification No. 49/2008. They contended that the MRP basis for assessment should comply with Central Excise rules. The appellant also claimed that the non-mention of MRP was not intentional and did not amount to mis-declaration under the Customs Act. The Tribunal found that the goods in question, such as radiators and compressors, were essential components of the final product, not mere accessories, and upheld the demand based on MRP.

Penalty Imposition and Extended Period of Limitation:
The appellant argued against the imposition of penalties under sections 114(AA) and 112(a) of the Customs Act, stating there was no suppression or mis-declaration as the classification under section 87 was known to the revenue. The Tribunal noted that the extended period of limitation was invoked for the demand raised in 2018, despite the bill of entries being from 2016. It found that all necessary data, except the MRP, was available in the entries, and there was no evidence of suppression by the appellant. Consequently, the Tribunal held that the extended period of limitation should not have been applied, leading to the appeal being allowed on the ground of limitation.

Conclusion:
The Tribunal ruled in favor of the appellant on the ground of limitation, finding that the extended period of limitation should not have been invoked in this case. The demand for countervailing duty based on MRP was upheld, considering the goods as essential components of the final product. The penalties imposed under the Customs Act were also discussed, with the Tribunal emphasizing the lack of suppression or mis-declaration by the appellant. The appeal was allowed on the basis of the limitation issue.