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Issues:
- Rejection of claim for reassessment and refund of duty on imported grinding set - Classification of grinding set under specific tariff headings - Eligibility for exemption under Notification 69/87-Cus. - Application of Section 19 of the Customs Act Analysis: The appeal pertains to the rejection of the appellants' claim for reassessment and refund of duty on a grinding set imported by them, which was initially assessed under sub-heading 4016.93 as "Gaskets, Washers, and other seals." The appellants sought re-assessment under Tariff Heading 98.06 along with Heading 8474.20, claiming exemption under Notification 69/87-Cus., dated 1-3-1987, arguing that the grinding set should be classified as crushing and grinding machines' parts. However, both lower authorities denied the exemption, stating that the goods, being parts of general use, did not qualify for the claimed classification and were excluded from Notification 257/88-Cus. The Collector (Appeals) further held that the goods could not be assessed under Section 19 of the Customs Act due to the unavailability of itemwise value at the time of import and restrictions on subsequent amendments to the Bill of Entry. The appellants contended that the previous import of identical goods was classified similarly at the same Custom House, emphasizing the lack of justification for the authorities' altered stance. They also raised concerns regarding the denial of natural justice by not granting a hearing before rejecting the claim for reassessment. The appellants' counsel argued that the grinding set, imported solely for replacement purposes, could not be considered a general-use item, supporting their classification claim. On the other hand, the Respondent's representative contended that sub-heading 8474.20 was inapplicable as the machinery mentioned in the suppliers' invoice was designated as "Spares for Polymerisation Chips Manufacturing Plant," falling outside the scope of the sub-heading. Additionally, referencing Section 19(b) of the Customs Act and Rule 3 of the Customs Tariff interpretation rules, the Respondent argued that composite goods should be classified based on the component providing their essential character, suggesting the classification under sub-heading 40.16.93 was appropriate due to the presence of rubber O-rings in the grinding set. Upon careful consideration of the submissions and case records, the Tribunal found that a specific heading for general-purpose crushing and grinding machines existed under sub-heading 8479.82, indicating the correct classification for the grinding set. Given this specific tariff provision, the Tribunal concluded that the grinding set, as parts of machinery falling under sub-heading 84.79.82, should be classified under sub-heading 98.06. Furthermore, the Tribunal determined that the grinding set was eligible for the exemption under Notification 69/87-Cus., dated 1-3-1987, as it fell under Heading 98.06 of goods specified under Heading 84.79. Consequently, the Tribunal set aside the lower authorities' orders and allowed the appeal, granting the appellants the consequential relief sought.
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