2024 (9) TMI 332 - AT - Customs

Classification of imported goods - Bed sheet declared as made of 100% Polyester - Revenue is of the view that the said consignment contains Polyester Woven Fabrics and the same is classifiable under CTH 5407 whereas the Appellant had classified the goods under CTH 6304 - mis-declaration of goods - HELD THAT - The appropriate classification of the said goods is Polyester woven printed quilts and the imported goods have been presented by the appellants as Polyester woven Quilt Cover . If the same are detached then it will look like bed sheet, which is not the correct view of the Revenue and in similar set of facts, this Tribunal has examined the issue in the case of M/S. ANNAPURNA INDUSTRIES, M/S. CF INC, M/S. SIDHANT CLASSIC, M/S. SIDHANT CLASSIC, COMMR. OF CUSTOMS, KOLKATA (PORT) , SHREE RAM COTSPIN PVT. LTD., M/S. KTC NIRYAT CO. PVT. LTD. AND M/S. V.K. TRADING CO. PVT. LTD. VERSUS COMMISSIONER OF CUSTOMS (PORT) , KOLKATA, M/S. THAKUR TEXTILE AND COMMISSIONER OF CUSTOMS (PREV.) , KOLKATA 2017 (8) TMI 1350 - CESTAT KOLKATA and held the goods in question are to be classified as Polyester woven printed quilts. Therefore, the goods imported by the appellants are only Polyster Quilt Cover . Going by the factual details above, particularly keeping in view the common parlance usage of the material as bed sheets which can be deduced from their size and the decided case laws, it is opined that the goods are classifiable under CTA 6304 as contended by the appellant and not under CTA 54.07 as has been held by the Revenue. Thus, particularly keeping in view the common parlance usage of the material as bed sheets which can be deduced from their size and the decided case laws the goods are classifiable under CTA 6304 as contended by the appellant and not under CTA 54.07 as has been held by the Revenue. Appeal allowed.

Summary

Issues Involved:
1. Classification of imported goods.
2. Allegation of mis-declaration of goods.
3. Applicability of Section XI Note 7 of the HSN.
4. Validity of test reports.
5. Previous similar cases and their relevance.

Detailed Analysis:

1. Classification of Imported Goods:
The primary issue revolves around the classification of the imported consignment of "Bed sheets" declared as "100% Polyester." The Revenue classified the goods under CTH 5407 (Woven fabrics of synthetic filament yarn), while the Appellant classified them under CTH 6304 (Other furnishing articles, including bedspreads). The Tribunal examined the size and nature of the goods, noting that they were intended to be used as bed sheets. The Tribunal concluded that the goods should be classified under CTH 6304, as they are meant to be sold as bed sheets, despite the lack of end stitching or hemming.

2. Allegation of Mis-Declaration of Goods:
The Revenue alleged that the Appellant mis-declared the goods by classifying them as bed sheets instead of woven fabrics. The Tribunal noted that the goods were imported in a form that could be easily converted into bed sheets, and the proprietor confirmed that they were sold as such. The Tribunal found that the goods were not mis-declared and should be classified as bed sheets under CTH 6304.

3. Applicability of Section XI Note 7 of the HSN:
The Revenue relied on Section XI Note 7(d) to argue that the goods did not meet the criteria for made-up articles. The Tribunal considered Note 7(b), which includes items produced in a finished state, ready for use without further sewing. The Tribunal concluded that the goods, being bed sheets in common parlance, met the criteria under Note 7(b) and should be classified as made-up articles under CTH 6304.

4. Validity of Test Reports:
The Tribunal reviewed two test reports from the Mumbai Textiles Committee and AITRA. Both reports were found to be inconclusive regarding the classification of the goods. The Mumbai Textiles Committee failed to provide an eight-digit CTH, and AITRA's report did not definitively classify the goods as fabrics. The Tribunal determined that the test reports did not provide sufficient evidence to classify the goods under CTH 5407.

5. Previous Similar Cases and Their Relevance:
The Appellant cited previous cases, including C & F, C, INC and Shilpha Finevest Pvt. Ltd., where similar issues were decided in favor of the importers. The Tribunal noted that in these cases, goods loosely stitched and resembling quilt covers were classified as quilt covers and not fabrics. The Tribunal found these cases relevant and concluded that the imported goods in the present case should be classified as bed sheets under CTH 6304.

Conclusion:
The Tribunal allowed the appeal, classifying the goods under CTH 6304 and not under CTH 5407. The Tribunal held that the imported goods were bed sheets, not woven fabrics, and were not mis-declared. The appeal was allowed with consequential relief as per law.