2012 (9) TMI 279 - CGOVT - Customs

Export of the goods - claim of duty drawback - Confiscation of goods & imposition of Fine and Penalty classification Held that - Mere allegation of wrong classification without proving intentional mala fide cannot lead to imposition of penalty - goods in question are round metallic item with circular threaded inner surface and rough/embossed out surface and as per dictionary meaning it is a female screw - goods in question is better classifiable as similar articles of screw and should not fall under description of brass builder Hardware. Under such circumstances it merits classifiable under 7415 and not under 8302, as claimed by the applicant - importer declared the complete description of goods and there is no suppression/mis-declaration and hence, action on the part of lower authorities regarding confiscation and imposition of fine and penalty liable to be set aside

Summary

Issues: Classification of goods under Custom Tariff Heading (CTH) 8302 or CTH 7415, Confiscation, Fine, and Penalty

Classification of Goods under CTH 8302 or CTH 7415:
The case involved a dispute over the classification of goods declared for export under Custom Tariff Heading (CTH) 83024900. The original authority classified the goods as female screws under CTH 7415, eligible for a lower drawback rate. The applicant argued that the goods, termed as Brass Anchors, were more appropriately classified under sub-heading 8302 with a higher drawback rate. The applicant contended that the goods were specifically designed for wall mounting purposes, making them suitable for use under CTH 83.02. The government observed that the goods, being round metallic items with circular threaded inner surface and rough/embossed outer surface, were akin to screws and hence classifiable under CTH 7415 as screw and similar articles. The government upheld the classification under CTH 7415, rejecting the applicant's claim under CTH 8302.

Confiscation, Fine, and Penalty:
The original authority had imposed a fine and penalty on the applicant along with confiscation of goods under Section 113(ii) of the Customs Act, 1962. The applicant challenged these actions, arguing that there was no finding of intentional mala fide or violation to warrant such penalties. The government noted that there was no suppression or mis-declaration by the importer, leading to the decision to set aside the confiscation, fine, and penalty imposed by the lower authorities. The Revision Application was disposed of accordingly, with the order for confiscation of goods and imposition of fine and penalty being set aside.

Conclusion:
The judgment primarily focused on the correct classification of the goods under CTH 8302 or CTH 7415, with the government siding with the original authority's classification under CTH 7415. Additionally, the decision highlighted the importance of establishing intentional mala fide for imposing penalties under the Customs Act, ultimately leading to the setting aside of the confiscation, fine, and penalty imposed on the applicant.