2018 (2) TMI 243 - AT - Customs

Classification of imported goods - coal - the appellants were importing coal from different countries, especially from Indonesia classifying as steam coal falling under CTH 2701 1290. The steam coal attracted nil rate of duty whereas the bituminous coal falling under CTH 2701 1200 attracted 5% duty as per Notification No.12/2012-Cus. dated 17.3.2012. Held that - in view of the conflicting decisions, the matter was referred to the Larger Bench and vide order dated 16.1.2017, the issue was taken up for consideration by the Larger Bench. On such date, taking note of the fact that the decision rendered by the Bangalore Bench in the case of M/s. Maruti Ispat and Energy Pvt. Ltd. was appealed before the Hon ble Apex Court, vide Civil Appeal Nos. 28937/2014 and 9725/2014, the Larger Bench directed that the matter being subjudice before the Hon ble Apex Court, the assessees were granted opportunity to come again before the Tribunal after the verdict from the Hon ble Apex Court - The CESTAT, Hyderabad has remanded the matter directing the adjudicating authorities to conduct denovo proceedings after the outcome of the decision of the Hon ble Apex Court. The appeals require to be remanded to the adjudicating authority for denovo consideration basing upon the outcome of the decision of the Hon ble Apex Court in Maruti Ispat and Energy Pvt. Ltd., as laid down by the Larger Bench of the Tribunal - appeal allowed by way of remand.

Summary

Issues Involved:
Classification of imported coal as steam coal or bituminous coal for duty rate determination.

Analysis:

Issue 1: Classification of Coal
The dispute in all the appeals revolved around the classification of coal imported by the appellant/assessee. The appellants were importing coal from various countries, especially Indonesia, and classifying it as steam coal under CTH 2701 1290, which attracted a nil rate of duty. On the other hand, bituminous coal under CTH 2701 1200 attracted a 5% duty as per Notification No.12/2012-Cus. dated 17.3.2012.

Analysis: Different Benches of CESTAT had conflicting decisions on the classification issue. The Chennai and Ahmedabad Benches held that the imported coal fell under steam coal with nil duty rate, a decision followed by the Mumbai Bench. In contrast, the Bangalore Bench classified the coal as bituminous, attracting a 5% duty rate. Due to these conflicting decisions, the matter was referred to the Larger Bench for consideration. The Larger Bench, noting that a decision from the Honorable Apex Court was pending in the case of M/s. Maruti Ispat and Energy Pvt. Ltd., granted the appellants an opportunity to return after the Apex Court's verdict.

Analysis: The department did not appeal against the Larger Bench decision, which granted liberty to the appellants to await the Apex Court's decision. Subsequently, other CESTAT Benches, such as Hyderabad and Ahmedabad, disposed of appeals in line with the Larger Bench decision, remanding cases for denovo proceedings post the Apex Court's decision. The Tribunal, based on the Larger Bench decision, set aside the impugned orders and remanded the matters to the adjudicating authority for further consideration in light of the Apex Court's decision in the Maruti Ispat and Energy Pvt. Ltd. case. Consequently, the miscellaneous applications were dismissed for lack of merit and being non-maintainable.

This comprehensive analysis of the legal judgment highlights the key issues, arguments presented by both parties, and the Tribunal's decision based on the Larger Bench's directive and the pending Apex Court decision.