1995 (9) TMI 172 - AT - Customs

Summary

Issues:
1. Classification of goods declared as "mixed Brass Scrap Honey" with foreign materials exceeding permitted limits.
2. Determination of differential duty and confiscation of goods under Sections 111(m) and 125 of the Customs Act, 1962.
3. Argument regarding the classification of Brass keys and Brass locks as industrial scrap.
4. Consideration of whether the excess material like locks and keys could be covered under "mixed Brass Scrap Honey" as per Chapter Note 6 of Section XIV of the Customs Tariff Act.

Analysis:
The appeal challenged the Order-in-original issued by the Additional Collector of Customs, New Delhi, concerning the classification of goods declared as "mixed Brass Scrap Honey" with excess foreign materials. The appellants imported a consignment of such goods, which upon examination, revealed foreign materials like Brass Keys, Brass locks, and copper scrap exceeding the permitted limits. The Additional Collector held that these goods did not conform to the description of brass scraps as per Chapter Note 6 of the Customs Tariff Act under Section XIV. A differential duty was imposed, and goods were confiscated but allowed to be redeemed on payment of a fine.

During the argument, the appellants contended that the Brass keys and Brass locks were old and unserviceable industrial scrap mixed with the imported goods without their knowledge. They emphasized that these items constituted an insignificant percentage of the total consignment and should be considered as metal scrap. The Departmental Representative (D.R.) reiterated that locks and keys could not be classified as metal scrap as per the filed Bill of Entry.

The Tribunal considered whether the excess material like locks and keys could be covered under "mixed Brass Scrap Honey." It was noted that locks and keys, being distinct items, did not fall under this category as per Chapter Note 6 of Section XIV. The Additional Collector acknowledged that the goods did not conform to the description, but no penalty was imposed due to the lack of mala fide intent and the importer's genuine use of brass artwares. The redemption fine was reduced to a token amount of Rs. 1000, and the appeal was rejected with the impugned order upheld, subject to this modification.