2024 (2) TMI 1268 - AT - Customs

Imported remelted zinc from Australia - classification of remelted zinc that whether it will be covered under CTH 7901 20 90 as claimed by the Department or under CTH 7901 12 00 as claimed by the Appellant - HELD THAT - We note that the Appellant vide Bill of Entry 3940705 dated 09.11.2017 and 4542175 dated 25.12.2017 have admittedly declared zinc at 95.85 % and 95.75% respectively which clearly does not correspond to the requirement as envisaged under note (b) of Chapter 79. The classification of the goods by the Department is proper and needs no interference. Either way the claims of Appellant find no merit. We observe that there was no foul in the department s reliance on the test reports in furtherance of ascertaining the classification of the goods in dispute. Thus, we are of the view that the impugned orders are just and legal which does not require any interference. Accordingly, the impugned orders are upheld. The appeals are dismissed.

Summary

Issues:
The main issue in the present case is the classification of "remelted zinc" under the Customs Tariff Act, 1975, specifically whether it falls under CTH 7901 20 90 as claimed by the Department or under CTH 7901 12 00 as claimed by the Appellant.

Classification Issue:
The Appellant, a company engaged in manufacturing Zinc Oxide, imports remelted zinc from Australia and classifies it under CTH 7901 12 00, paying a 5% duty. However, a show cause notice alleged that based on the zinc content, the goods should be classified as "zinc alloys" under CTH 7901 20 90, with a 7.5% duty. The Department demanded a differential duty of Rs. 3,74,518 under section 28(1) of the Customs Act, 1962. The Commissioner (Appeals) upheld this decision, leading to the present appeal.

Appellant's Arguments:
The Appellant's counsel argued that the test reports relied upon did not follow the correct procedure, citing various judgments in support. Additionally, they contended that the penalty imposed was beyond the scope of the Show Cause Notice as it was under a different section of the Customs Act, 1962.

Revenue's Response:
The Revenue representative reiterated the findings of the impugned order, supporting the classification under CTH 7901 20 90.

Judgment:
The Tribunal considered submissions from both sides and examined the records. It noted discrepancies in the zinc content declared by the Appellant, which did not align with the requirements of Chapter 79. The reliance on test reports by the adjudicating authority was deemed appropriate, as the description provided by the Appellant also did not meet the chapter's requirements. Therefore, the re-classification of the goods under CTH 7901 20 90 was upheld. The Tribunal found no merit in the Appellant's claims and stated that the Department's classification was correct, warranting no interference. The judgments cited by the Appellant were deemed irrelevant due to differing circumstances. Consequently, the impugned orders were upheld, and the appeals were dismissed.

(Separate Judgment by Judges: None)

(Pronounced in the open court on 26.02.2024)