2013 (5) TMI 297 - AT - Customs

Classification/Valuation dispute import of re-rollable plates - Imposition of redemption fine or penalty Held that - The observation of Chartered Engineer available who has categorically remarked that 90% of the goods imported were serviceable material and recoverable from the plates imported by appellant. Balance material of 10% was found to be re-rollable after cutting from the plates to make that serviceable. The appellant has not declared thickness or size of the goods in the bill of entry and it only says re-rollable plates. Therefore, there cannot be any divergent view from the technical view relied by Revenue who has occasion to physically inspect the goods for his opinion. The goods imported shall fall into tariff entry 7208.4010 for the percentage and character described in technical report. Redemption fine - held that - appellant has force for reduction in redemption fine since percentage of the character of the goods has been mentioned in technical report which is 10% to be re-rollable. Keeping this aspect in view we direct that redemption fine be reduced to Rs. 2 lakhs. So far as penalty is concerned, in view of classification issue involved, finding the declaration contrary to law and looking into modus operandi followed, penalty of Rs. 25,000/- is confirmed.

Summary

Issues:
Classification and valuation of imported goods under Tariff Entry No. 7208.9000 vs. 7208.4010, imposition of redemption fine and penalty.

Analysis:
1. The appellant argued that the imported goods, re-rollable plates, should be classified under Tariff Entry No. 7208.9000, while the department classified them under 7208.4010. The misclassification led to the imposition of a redemption fine and penalty. The appellant contended that the classification under 7208.4010 was incorrect and challenged the Commissioner (Appeals) order.

2. The appellant emphasized that the goods were re-rollable plates falling under Tariff Entry 7208.9000, not requiring proof of thickness as they were not original H.R. plates. The department's overvaluation was unwarranted as the goods did not fit under Tariff Entry 7208.4010. Therefore, the redemption fine and penalty were unjustified.

3. The Departmental Representative (D.R.) argued that the goods were mis-declared and undervalued. Upon examination, the goods were found to be serviceable H.R. plates, correctly classified under Tariff Entry 7208.4010. The valuation remained undisputed, and the appellant did not challenge the Chartered Engineer's report on the goods' character.

4. The Tribunal analyzed the classification under Tariff Heading 7208, emphasizing that plates of different thicknesses belonged to the same family of goods. The legislation intended plates of various thicknesses to fall under the 7208 tariff entry. The technical report confirmed that 90% of the imported goods were serviceable material, supporting the correct classification under 7208.4010.

5. The Tribunal upheld the technical report's findings, stating that the goods fell under Tariff Entry 7208.4010 based on the percentage and character described in the report. The appellant's failure to declare the goods' thickness or size in the bill of entry supported the Revenue's classification upon physical inspection.

6. Finally, the Tribunal addressed the redemption fine and penalty. Considering the technical report's findings, the redemption fine was reduced to Rs. 2 lakhs. The penalty of Rs. 25,000 was confirmed due to the classification issue and the appellant's non-compliance with the law. The adjudication was upheld, with the exception of the reduction in the redemption fine.

This detailed analysis highlights the key arguments, findings, and decisions made by the Tribunal regarding the classification, valuation, redemption fine, and penalty in the legal judgment.