9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (11) TMI 126 - AT - CustomsClassification of imported goods - miscellaneous Chemicals plasticizer - to be classified under CTH 38122090 or not - Advance authorization licence scheme - goods declared as Plasticizers -Shell Flavex 595 B - willful and deliberate misdeclaration and suppression of factual description of the goods or not - conditional exemption under N/N. 96/2009-Cus dated 11.09.2009 - time limitation - HELD THAT - As per the impugned order the learned Adjudicating Authority has decided the classification as Rubber Processing oil under CTH 27079900 however, maintaining the benefit of Notification No 96/2009-Cus dropped the proceeding of the SCN. It is found that even though the classification of the goods has been changed from 38122090 to 270799000 but the goods imported by the appellant even though as per the test report due to the reason that the product s Aromatic Constituent exceeds Non Aromatic Constituents but the goods were admittedly used by the appellant in the manufacture of their export final product as Plasticizer only. Therefore, as per the use the respondent has correctly mentioned the description as Plasticizer. As per the Notification No. 96/2009 all the raw materials are exempted if it is used in the manufacture of export goods. In the present case there is no dispute that the goods imported by the respondents are used in the manufacture of their final export product this has been established on the basis of verification conducted by the Assistant Commissioner of Central Excise and Service Tax, Bhiwadi Rajasthan vide letter dated 31.12.15 wherein it was stated that the subject goods imported under Advance Authorization by the noticee during last 5 years has been used by them for the manufacture. With this undisputed fact substantive requirement of FTP and the Notification No 96/2009-Cus was complied with. Further, there is no reason for respondent to mis- declare the classification because even if the correct classification as held by the department is declared by the appellant the same benefit was available to the appellant. Therefore, it is only on the basis of test report which found that aromatic constituents exceed that of non aromatic constituents. The use of the product does not get altered therefore only because the appellant has not declared the classification correctly that too under their Bonafide belief the benefit of Advance Authorization and notification issued there under cannot be denied - This issue has been considered by this tribunal in the case of M/S. PSL LIMITED, SHRI MANOJ SANGHVI, M/S. RATNAMANI METALS TUBES LIMITED AND OTHERS VERSUS COMMISSIONER OF CUSTOMS, KANDLA 2014 (5) TMI 789 - CESTAT AHMEDABAD wherein the similar issue has been considered. In that case the appellants imported Hot Rolled Steel coils/Plates which were used for making steel pipes for export under Advance Authorization. All the appellants described the goods as Primer HR Coils and classified under CTH 72083690. The Learned Adjudicating Authority rightly extended the benefit of exemption notification despite the change in classification. It is also observed that even though the SCN was issued, EODC were issued and Customs Bond have been discharged, it clearly indicates that there is no non observance of any condition, for this reason also benefit of notification cannot be denied. Though the department is not precluded for investigating a matter as related to classification but EODC was issued on the ground that the goods imported have been used for the intended purpose therefore, the benefit cannot be denied. Time Limitation - HELD THAT - There are force in this submission of the respondent therefore, there is no willful mis declaration of the goods. Hence, no malafide can be attributed to the respondent even if the declaration made there is not found acceptable in as much as it is the matter of the interpretation and onus to correctly classify the goods is upon the revenue. Therefore the demand for the extended period is also not sustainable on limitation. The impugned order is liable to be sustained - Appeal dismissed - decided against Revenue.
Issues Involved:
1. Misdeclaration of imported goods as "Plasticizers" instead of "Rubber Process Oil." 2. Eligibility for exemption under Notification No. 96/2009-Cus dated 11.09.2009. 3. Classification of imported goods under the correct Customs Tariff Heading (CTH). 4. Demand for differential customs duty, interest, and penalties. 5. Confiscation of imported goods under Section 111(m) and 111(o) of the Customs Act, 1962. 6. Invocation of extended period of limitation for demand. 7. Applicability of the Doctrine of Revenue Neutrality. Detailed Analysis: 1. Misdeclaration of Imported Goods: The department contended that the respondent misdeclared the imported goods as "Plasticizers" under CTH 38122090, while the test report identified the goods as "Rubber Process Oil," classifiable under CTH 27079900. The respondent argued that the goods were used as plasticizers in the tyre manufacturing process, thus justifying the declared classification. 2. Eligibility for Exemption under Notification No. 96/2009-Cus: The department argued that due to the misdeclaration, the respondent was not entitled to the exemption under Notification No. 96/2009-Cus. The respondent countered that the goods were used in the manufacture of export products, fulfilling the substantive requirements of the Foreign Trade Policy (FTP) and the notification. The tribunal found that the goods were indeed used as plasticizers in the export products, thus meeting the notification's conditions. 3. Classification of Imported Goods: The adjudicating authority reclassified the goods under CTH 27079900 but maintained the benefit of the exemption notification. The tribunal upheld this decision, noting that the use of the product as a plasticizer did not change despite the reclassification. The tribunal referenced the PSL Ltd. case, where a similar issue of classification was resolved in favor of the importer. 4. Demand for Differential Customs Duty, Interest, and Penalties: The department proposed to demand differential customs duty, interest, and penalties under Sections 28(4) and 18(2) of the Customs Act, 1962. The adjudicating authority dropped these proceedings, and the tribunal upheld this decision, noting that the respondent acted in good faith and there was no willful misdeclaration or intent to evade duty. 5. Confiscation of Imported Goods: The department proposed to confiscate the imported goods under Sections 111(m) and 111(o) of the Customs Act, 1962. The adjudicating authority did not find any evidence of diversion or misuse of the imported goods and thus did not uphold the confiscation. The tribunal agreed, emphasizing that the goods were used for the intended purpose of manufacturing export products. 6. Invocation of Extended Period of Limitation: The respondent argued that the demand was time-barred, as the last bill of entry was dated 01.05.2015, and the show cause notice was issued on 30.08.2017. The tribunal found that the department did not provide sufficient grounds for invoking the extended period of limitation, agreeing with the respondent that there was no willful misdeclaration or suppression of facts. 7. Applicability of the Doctrine of Revenue Neutrality: The respondent claimed that any duty demanded would be refunded as duty drawback, invoking the Doctrine of Revenue Neutrality. The tribunal noted that the goods were used in the manufacture of export products, and denying the exemption would result in taxing exports, which is against the policy of zero-rating exports. Conclusion: The tribunal upheld the adjudicating authority's order, maintaining the reclassification of the goods under CTH 27079900 but allowing the benefit of the exemption under Notification No. 96/2009-Cus. The tribunal dismissed the revenue's appeal, finding no evidence of willful misdeclaration, misuse of imported goods, or grounds for invoking the extended period of limitation. The tribunal emphasized that the substantive requirements of the FTP and the notification were met, and the respondent acted in good faith.
|
