2002 (4) TMI 203 - AT - Customs

Summary

Issues:
Classification of imported goods as acrylic fiber, liability to pay customs duty, interest for delayed payment of duty, confiscation of goods, imposition of penalty, challenge against redemption fine and interest on duty.

Classification of Imported Goods as Acrylic Fiber:
The appeal filed by M/s. H.B. Fibres Ltd. challenged the order of the Commissioner of Customs classifying the imported goods as acrylic fiber under heading 5503.30 of the Customs Tariff Act, 1975. The goods were initially declared as "wool waste" but were found to be acrylic fiber upon further inspection. The appellants conceded that the goods were indeed acrylic fiber and paid the differential duty amount. The Commissioner held that the goods should be valued at US $ 1.12 per kg and assessed to duty accordingly.

Liability to Pay Customs Duty and Interest for Delayed Payment:
M/s. H.B. Fibres Ltd. was held liable to pay customs duty amounting to Rs. 35,46,456 under Section 28(2) of the Customs Act, 1962. The appellants did not contest the proposal to charge interest on the duty amount under Section 28AB of the Customs Act, as they had short-paid duty due to misdeclaration of goods.

Confiscation of Goods and Imposition of Penalty:
The goods, although liable for confiscation under Section 111(m) of the Customs Act, were not available for confiscation as they had been provisionally released to M/s. H.B. Fibres Ltd. A redemption fine of Rs. 15,00,000 was imposed on the importer. Additionally, a penalty of Rs. 20,000 was imposed on M/s. H.B. Fibres Ltd. under Section 112(a) of the Customs Act.

Challenge Against Redemption Fine and Interest on Duty:
The appellants challenged the redemption fine and interest on duty. The counsel argued that the redemption fine was unwarranted as the misdeclaration was done by another party, and the appellants acted in good faith. However, the Tribunal upheld the redemption fine but reduced it to Rs. 10,00,000. The demand for interest under Section 28AB was set aside as the duty liability had been discharged before finalization of the assessment.

Examination of Additional Claim:
An application submitted by the appellants regarding the re-computation of anti-dumping duty was considered by the Tribunal. The Tribunal directed the Commissioner of Customs to re-examine the claim and make a decision after providing the party with an opportunity to be heard.

Conclusion:
The appeal was disposed of with the affirmation of the duty demand and penalty, setting aside the demand for interest, and reducing the redemption fine. The Commissioner was directed to re-examine the claim related to anti-dumping duty.