2013 (10) TMI 578 - AT - Customs

Benefit of Notification No. 4/2006 Waiver of Pre-deposit - the appellant imported iron ore pellets and claimed exemption from payment of duty under Notification No. 4/2006-CE - Whether the appellant is eligible for the benefit of exemption on the goods imported by them - Held that - The description of the goods given in the said Tariff heading number reads as iron ore pellets - The heading 2601 talks about iron and concentrates in our view if the pellets are also considered as iron ore then the heading given in the notification talks about exemption to ores . If the CETA itself considers iron goods imported by the appellant as iron ore pellets prima facie denying the benefits of exemption notification to the appellant would not arise - chapter note No. 2 of chapter 26 also seems to indicate a view which is beneficial to the assessee inasmuch as it talks about meaning of term ores to mean minerals actually used in the metallurgical industry for the extraction of mercury or the metals of heading 2844 or of the metals of section XIV or XV of the Central Excise Tariff Act 1985 - iron ore pellets which are imported by the appellant are used in the metallurgical industry for the extraction of iron which falls under section XVI of the Central Excise Tariff Act-1985 - the appellant has made out a prima facie case for the waiver of pre-deposit of the amount involved on the ground that the benefit of notification No. 4/2006-CE extendable to them Stay granted.

Summary

Issues:
- Eligibility for exemption under Notification No. 4/2006-CE for imported iron ore pellets.

Analysis:
The judgment by the Appellate Tribunal CESTAT AHMEDABAD dealt with the issue of whether the appellant was eligible for the benefit of exemption on the goods they imported, specifically iron ore pellets. The adjudicating authority confirmed certain amounts against the appellants, stating that the iron ore pellets were produced from iron ore concentrates and thus not eligible for the claimed exemption. The appellant argued that the notification No. 4/2006-CE provided exemption for ores falling under chapter heading No. 2601 to 2617, which included iron ore pellets under chapter heading No. 26011210. They contended that the circular relied upon by the adjudicating authority was not applicable to the period in question (March 2011 to February 2012).

The Departmental Representative argued that iron ore concentrate was considered a manufactured item under Chapter Note No. 4 of Chapter 26, and that excise duty was levied on products imported after being manufactured in India. They claimed that the process of converting iron into concentrates amounted to manufacturing, making the iron ore pellets liable for excise duty. The Departmental Representative asserted that the benefit of the exemption under notification 4/2006-CE was not available to the appellant due to misdeclaration of goods, justifying the invocation of the extended period for confirming the duty demand.

The Tribunal analyzed both sides' submissions and reviewed the records. They found that the issue revolved around the appellant's eligibility for exemption on the imported iron ore pellets. The Tribunal disagreed with the Department's contentions and the adjudicating authority's decision, citing the specific entry in notification No. 4/2006-CE exempting ores falling under chapter heading No. 2601 to 2617, which included iron ore pellets. They highlighted that the Central Excise Tariff Act considered iron ore pellets as falling under the category of iron ores, making the exemption applicable. Additionally, they noted that the pellets were used in the metallurgical industry for iron extraction, aligning with the meaning of ores under chapter note No. 2 of chapter 26. Consequently, the Tribunal held that the appellant had a prima facie case for the waiver of the pre-deposit amount, allowing the application and staying the recovery until the appeals' disposal.

In conclusion, the judgment favored the appellant's argument regarding the eligibility for exemption under Notification No. 4/2006-CE for the imported iron ore pellets, emphasizing the classification of the pellets as iron ores and their use in the metallurgical industry to support the waiver of the pre-deposit amount.