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2024 (9) TMI 125 - AT - CustomsClassification of imported goods calcium Carbonate - classifiable under CTH 28365000 as claimed by the revenue or as calcite powder falling under CTH 25369030 as declared by the appellant - entire case was made out on the observation of the Chemical examiner, Customs Laboratory, Kandla wherein he had opined that the goods imported by the appellant is Calcium Carbonate - applicability of Board Circular No. 43/2017-Cus., dated 16.11.2017 and also Board Circular No. 15/2009-Cus. dated 07.06.2009 - HELD THAT - It is found that the department s claim of classification of the imported goods i.e. calcite powder as calcium carbonate under CTH 28365000 is based on Customs Laboratory report of Kandla which only opined that the goods is calcium carbonate. Firstly even if goods are calcium carbonate only because of this it is not classifiable under CTH 28365000. In order to classify under the said tariff item, the goods should be in confirmation to IS standard and must meet with the parameters provided in the IS specification. However, in the present case no such test was done. Secondly, as per Board Circular No. 03/2007-Cus dated 16.11.2017 and Board Circular No. 15/2019-Cus dated 07.06.2019. The board itself has endorsed that the Customs Laboratory, Kandla did not have the facility to test the imported goods in question. Therefore, in such case any report given by the said laboratory which is not equipped with the facility of testing such product, the test report cannot be accepted as correct and on that basis classification cannot be decided. In the case of ASIAN GRANITO INDIA LTD 2020 (8) TMI 615 - CESTAT AHMEDABAD , it can be seen that since laboratory were not equipped at the relevant time, it was held that the test report of such laboratory cannot be accepted. The department s claim of change of classification also will not sustain. Thus, finding the claim of the revenue to classify the calcite powder imported by the appellant being based only on Chemical Examiner Report of Customs Laboratory, Kandla which is not equipped for testing the goods in question has no legs to stand. The impugned orders are set aside - Appeal allowed.
Issues Involved:
1. Classification of imported goods (calcium carbonate vs. calcite powder). 2. Reliability of the Customs Laboratory report from Kandla. 3. Applicability of Board Circulars regarding the testing capabilities of Customs Laboratories. 4. Precedential value of prior Tribunal decisions. Detailed Analysis: 1. Classification of Imported Goods: The primary issue is whether the imported goods, identified as calcium carbonate by the revenue, should be classified under CTH 28365000 or as calcite powder under CTH 25369030 as declared by the appellant. The appellant argued that the Customs Laboratory at Kandla was not equipped to test the product during the relevant period, as clarified by Board Circular No. 43/2017-Cus. and Board Circular No. 15/2009-Cus. The Tribunal referenced the decision in ASIAN GRANITO INDIA LTD VS. COMMISSIONER OF CUSTOMS, MUNDRA, where a similar issue was resolved in favor of the appellant, classifying the goods under CTH 2503 90 30. 2. Reliability of the Customs Laboratory Report: The Tribunal noted that the classification claim by the department was based solely on the Customs Laboratory report from Kandla, which identified the goods as calcium carbonate. However, the Tribunal emphasized that the laboratory was not equipped to test the product in question, as stated in Board Circulars No. 43/2017-Cus. and No. 15/2019-Cus. The Tribunal concluded that any report from an inadequately equipped laboratory could not be accepted as correct. 3. Applicability of Board Circulars: The Tribunal heavily relied on Board Circular No. 43/2017-Cus. and Board Circular No. 15/2019-Cus., which acknowledged that the Customs Laboratory at Kandla was not equipped to test calcite powder until 2019. This acknowledgment invalidated the test reports from the Kandla laboratory for classification purposes. The Tribunal referenced multiple cases, including Manikya Creations (P.) Ltd. and Pavas Polychem (P.) Ltd., where similar issues were resolved based on the same Board Circulars. 4. Precedential Value of Prior Tribunal Decisions: The Tribunal distinguished the case of Meghraj Chemicals And Agencies, which was relied upon by the revenue, stating that it was an ex-parte decision without representation from the appellant and did not consider the Division Bench decision in ASIAN GRANITO INDIA LTD. The Tribunal also noted that the Meghraj decision did not take into account the Board Circulars confirming the inadequacy of the Kandla laboratory. Therefore, the Tribunal deemed the Meghraj decision as per incuriam and not applicable to the present case. Conclusion: The Tribunal concluded that the classification of the imported goods as calcium carbonate under CTH 28365000 by the revenue was unsupported due to the inadequacy of the Kandla Customs Laboratory in testing the product. The Tribunal upheld the appellant's classification of the goods under CTH 2503 90 30, setting aside the differential duty demand, interest, fine, and penalties. The appeal was allowed with consequential reliefs, and the impugned orders were set aside. The decision was pronounced in open court on 30.08.2024.
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