2024 (2) TMI 1139 - AT - Customs

Classification of imported goods - 474.860 MTs of imported goods, namely, Petroleum Hydrocarbon Solvent (125/240) Grade M.T.O - to be classified under CTH 27101990 and therefore same being freely importable? - HELD THAT - The test report of Customs Laboratory, provides that 90% of goods by volume get distilled at 195 degee C, i.e. below 210-degree C followed by 95% distillation at 207-degree C. We find that this issue is similar to the one decided by the Hon ble SUPREME COURT in the matter of Krishna Technochem Pvt. Ltd 2022 (4) TMI 732 - SUPREME COURT as well as Kunjal Synergies Pvt. Ltd Vs. C.C., Mundar 2023 (9) TMI 730 - CESTAT AHMEDABAD of this bench only, wherein 95% distillation had taken place below 210 degree C and therefore interpreting at in the above said Chapter note as upto the benefit was allowed by classifying the goods under Customs Tariff Heading 2710 1990 and rejecting department s classification under CTH 2710 12. We, therefore, agree with the aforesaid decision and hold that the classification made by the appellant is correct. Appeal is therefore allowed with consequential relief.

Summary

Issues involved: Classification of imported goods under Customs Tariff Heading (CTH) 2710 19 90 as "Others" by the appellant, disputed by the Department which classified the goods under CTH 2710 12 90 as restricted. Confiscation of goods under Customs Act, 1962 and imposition of fine and penalty.

The appellant filed Bill of Entry for clearance of imported goods classified under CTH 2710 19 90 as "Others". The Customs laboratory report indicated that 90% of the goods distilled below 210-degree C, leading the Department to classify the goods under CTH 2710 12 90, a restricted category. The Adjudicating Authority confiscated the goods under Customs Act, 1962, and imposed fines and penalties. The Commissioner (Appeals) upheld the decision, prompting the appellant to file an appeal.

The appellant argued citing a Supreme Court decision that the word "at" in sub-heading notes should be interpreted strictly, not as "up to". They referenced a previous Tribunal case where classification under CTH 2710 1990 was upheld based on similar distillation results. The Department relied on a separate case to support the restricted classification and penalties imposed.

The Tribunal considered the Customs laboratory report showing distillation below 210-degree C and the Supreme Court's interpretation of sub-heading notes. They noted that 95% distillation occurred at 195 degree C, not at 210 degree C as insisted by the Department. Referring to previous decisions, the Tribunal agreed with the appellant's classification under CTH 2710 1990, rejecting the Department's classification under CTH 2710 12 90. The appeal was allowed, granting consequential relief to the appellant.