2025 (2) TMI 525 - AT - Customs

Classification of imported goods - Light Green Float Glass Light Green Float Glass - to be classified under Customs Tariff Item CTI 7005 10 10 of the First Schedule to the Customs Tariff Act 1975 or under CTI 7005 21 10? - benefit of exemption from payment of basic customs duty under the Exemption Notification dated 01.06.2011? - HELD THAT - It is not in dispute that this issue was examined at length by the Commissioner (Appeals) in the order dated 20.07.2022 passed in Appeal Nos. 861-863/2022-23. This order was passed pursuant to the judgment dated 11.02.2022 of the Supreme Court that disposed of three appeals that had been filed by Asahi India Glass. The issue involved before the Commissioner (Appeals) was classification of Light Green Float Glass. After referring to the Customs Tariff and the competing entries and the test reports the Commissioner (Appeals) held that Light Green Float Glass imported by Asahi India Glass would merit classification under CTI 7005 10 10 and consequently would be entitled to claim exemption under the Notification dated 01.06.2011. The order dated 14.12.2023 passed by the Commissioner (Appeals) that has been impugned in this appeal takes cognizance of the earlier order dated 20.07.2022 passed by the Commissioner (Appeals) in favour of Asahi India Glass and also notes that the said order was accepted by the department. Once the order passed by the Commissioner (Appeals) classifying Light Green Float Glass under CTI 7005 10 10 has been accepted by the department it is not permissible for the department to contend in this appeal that Light Green Float Glass should be classified under CTI 7005 21 10. The Circular dated 14.11.2024 deals with the question whether the presence of a tin layer (which is present by default in all float glass) on one side can be treated as the absorbent reflective layer. The Board clarified that issue was examined in consultation with CSIR-Central Glass Ceramic Research Institute Kolkata. On examination the Board found that Getting tin layer on the one side of the glass by default does not mean that it satisfies the condition under Note 2(c) of Chapter 70 that the expression absorbent reflecting or non-reflecting layer means a microscopically thin coating of metal or of a chemical compound (for e.g. metal oxide) . It was therefore clarified that clear float glass which is not wired not coloured not reflective not tinted and only has a tin layer on one side with no other metal oxide layer on it will be said to be having no absorbent layer and consequently classifiable under CTI 7005 2990. The test reports issued by CSIR Kolkata also relied upon by the Commissioner of Customs (Appeals) in the impugned order record that the tin side is detected under UV illumination using tin detector and an absorbent layer is observed on tin side of the glass which is fluorescent under UV illumination . The Circular cannot provide for a stand which is contrary to the settled position determined by the Tribunal. Once the disputed goods satisfy all the conditions of Note 2(c) of Chapter 70 they deserve to be classified under CTI 7005 10 10 of the Customs Tariff Act. Conclusion - The Light Green Float Glass imported by Asahi India Glass should be classified under CTI 7005 10 10. Appeal dismissed.

Summary

Issues Presented and Considered

The core issue in this appeal was the classification of Light Green Float Glass imported by Asahi India Glass. The primary question was whether the glass should be classified under Customs Tariff Item (CTI) 7005 10 10, as claimed by Asahi India Glass, or under CTI 7005 21 10, as claimed by the department. This classification would determine the eligibility for exemption from basic customs duty under the Exemption Notification dated 01.06.2011.

Issue-Wise Detailed Analysis

Relevant Legal Framework and Precedents

The classification issue revolved around the interpretation of tariff headings under Chapter 70 of the Customs Tariff Act, 1975. CTI 7005 10 covers non-wired glass with an absorbent, reflecting, or non-reflecting layer, while CTI 7005 21 covers glass that is colored throughout the mass (body tinted). The burden of proof for classification lies with the Department, and previous rulings, including those from the High Court and the Supreme Court, were considered.

Court's Interpretation and Reasoning

The Tribunal relied on previous decisions, including an order from the Commissioner (Appeals) dated 20.07.2022, which classified the glass under CTI 7005 10 10. The Tribunal emphasized that the presence of a tin layer on one side of the glass qualifies it as having an absorbent layer, thus meriting classification under CTI 7005 10 10.

Key Evidence and Findings

The Tribunal considered test reports from the Central Glass and Ceramic Research Institute, Kolkata, which indicated the presence of a tin layer on one side of the glass. This layer was deemed to be absorbent, supporting the classification under CTI 7005 10 10.

Application of Law to Facts

The Tribunal applied the legal framework to the facts by examining the test reports and previous rulings. It concluded that the presence of the tin layer, as an absorbent layer, justified the classification under CTI 7005 10 10, aligning with the legal interpretation of the tariff headings.

Treatment of Competing Arguments

The Department argued that the glass should be classified under CTI 7005 21 10, emphasizing that the glass was body-tinted. However, the Tribunal found this interpretation erroneous, as the presence of the tin layer was a decisive factor for classification under CTI 7005 10 10.

Conclusions

The Tribunal concluded that the classification under CTI 7005 10 10 was correct, and the Department's appeal was dismissed. The Tribunal upheld the order of the Commissioner (Appeals) and confirmed the eligibility for exemption under the Exemption Notification.

Significant Holdings

Core Principles Established

The Tribunal reaffirmed that the burden of proof for classification lies with the Department. It also emphasized that once a classification issue is settled and accepted by the Department, it cannot be reopened based on subsequent circulars or interpretations.

Final Determinations on Each Issue

The Tribunal determined that the Light Green Float Glass imported by Asahi India Glass should be classified under CTI 7005 10 10. The presence of the tin layer was sufficient to meet the criteria for this classification, and the Department's arguments to the contrary were rejected.

The Tribunal's decision was based on a thorough analysis of the legal framework, test reports, and previous rulings. It concluded that the classification under CTI 7005 10 10 was appropriate, and the appeal by the Department was dismissed.