1997 (6) TMI 127 - AT - Central Excise

Summary

Issues:
1. Classification of imported goods under Customs Tariff Act.
2. Exemption under Notification 19/94 for Naphtha.
3. Jurisdiction of Asstt. Collector at Panvel to modify classification.

Analysis:

1. Classification of imported goods under Customs Tariff Act:
The case involved the classification of DI ISO BUTYLENE (DIIB) imported by the appellant. The dispute arose when the department contested the classification claimed by the appellant, arguing that there was no evidence to support the classification of DIIB as Naphtha. The Chemical Examiner's report described DIIB as a clear colorless volatile liquid with specific characteristics. The Asstt. Collector classified DIIB under Heading 27.10 Customs Tariff Act, attracting a duty of 30% + CVD 20%. The appellant contested this classification, citing previous classification by the Collector of Customs at Kandla. The Commissioner of Customs and Central Excise (Appeals) upheld the Asstt. Collector's classification, stating that Naphtha and DIIB were distinct products both commercially and technically.

2. Exemption under Notification 19/94 for Naphtha:
The appellant argued for exemption under Notification 19/94, claiming that DIIB should be classified as Naphtha and thus be eligible for NIL duty exemption. The appellant presented expert opinions from Mumbai University and IIT, stating that DIIB is similar to Naphtha. However, the authorities held that the exemption for Naphtha under the Notification did not extend to products similar to Naphtha. The Tribunal emphasized the strict interpretation of exemption notifications, stating that the burden lies on the importer to clearly establish eligibility for exemption. Despite the appellant's evidence suggesting similarity to Naphtha, DIIB was deemed a distinct commercial product and not covered by the Naphtha exemption.

3. Jurisdiction of Asstt. Collector at Panvel to modify classification:
The appellants challenged the Asstt. Collector at Panvel's authority to modify the classification done by the Kandla Custom House during into-bond clearances. The Tribunal referred to a previous decision by a Larger Bench, which held that the assessment at the time of into-bond clearances is tentative and can be re-assessed at the time of ex-bond clearances. The Tribunal cited cases where re-assessment at the place of ex-bond clearance was deemed appropriate, emphasizing that the jurisdictional authority at the time of clearance for home consumption has the right to review the classification. Therefore, the appellant's argument regarding jurisdiction was deemed unacceptable, and the appeal was rejected.

In conclusion, the Tribunal upheld the classification of DIIB under Heading 27.10 Customs Tariff Act, denied the exemption under Notification 19/94 for Naphtha, and affirmed the Asstt. Collector's jurisdiction to modify the classification during ex-bond clearances.