2001 (6) TMI 342 - AT - Customs

Summary

Issues Involved:
1. Correct classification of the imported wood.
2. Confiscation and imposition of personal penalty.
3. Evaluation of evidence and reports.
4. Application of legal precedents and explanatory notes.

Detailed Analysis:

1. Correct Classification of the Imported Wood:
The primary issue in the appeal revolves around the correct classification of the imported wood. The appellants argued that the wood was "wood in rough/roughly squared (not sawn)" under Heading 44.03, while the Revenue contended it was "sawn timber" classifiable under Heading 44.07. The appellants supported their claim with several documents, including the invoice, bill of entry, packing list, Phytosanitary Certificate, and Certificate of Origin, all describing the goods as "Wood-in-rough/roughly squared (HSN 44.03)." Additionally, the goods were examined by customs officers and found to match the declaration.

2. Confiscation and Imposition of Personal Penalty:
Due to the Revenue's classification under Heading 44.07, the goods were deemed liable for confiscation. Since the goods were not available for confiscation, a personal penalty of Rs. 5 lac was imposed on the appellants. The appellants challenged this order, arguing that the goods were correctly classified under Heading 44.03 and thus not subject to confiscation or penalty.

3. Evaluation of Evidence and Reports:
The evidence relied upon by the Revenue included a report dated 5-2-1998 by Shri R.K. Bose, which classified the wood as "sawn." However, this was contradicted by an earlier report dated 27-1-1998 and cross-examination findings, which indicated the wood was "roughly squared" with bark and sap wood present. The Commissioner initially dismissed the earlier report but, upon further consideration, it was noted that the evidence overwhelmingly supported the appellants' classification under Heading 44.03.

4. Application of Legal Precedents and Explanatory Notes:
The appellants cited several legal precedents, including decisions from the Tribunal and the Supreme Court, which supported their classification. The Tribunal's decision in Hariram Goel & Co. v. C.C. and other cases like Hunsur Plywood Works Ltd. v. C.C. and A.G. Daftary v. C.C. were particularly relevant. These cases established that wood with rough surfaces, bark traces, and hand-sawing marks should be classified under Heading 44.03. The Tribunal applied these precedents and the explanatory notes in the Harmonized System of Nomenclature (HSN) to conclude that the imported wood was "wood-in-rough/roughly squared" and not "sawn timber."

Conclusion:
The Tribunal concluded that the imported wood was correctly classifiable under Heading 44.03 as "wood-in-rough/roughly squared." The evidence, including cross-examination and documentary proof, supported this classification. Consequently, the order of confiscation and the imposition of a personal penalty were set aside, and the appeal was allowed with consequential relief to the appellants.