2002 (9) TMI 121 - HC - Customs

Summary

Issues: Classification of goods under Customs Tariff Act

Issue 1: Classification of goods under Customs Tariff Act
The petition challenged the classification of goods under heading 39.26 instead of heading 85.47 of the Customs Tariff Act (CTA). The petitioners argued that the goods, used for insulating joints and ends of cables, were specifically designed for insulating purposes and wholly made of insulating material with minor metal components. They contended that the correct classification should be under heading 85.47, as per the General Rules for interpretation of entries in the CTA. Expert opinion and certificates from consumers supported the classification under heading 85.47, emphasizing the insulating property of the goods. The petitioners also cited the judgment in XL Telecom P. Ltd. v. Union of India, which highlighted the principle of "Generalia Specialibus non Derogant" and the identification of goods by users in determining classification.

Issue 2: Past Practice and Precedents
The petitioners relied on past practice and precedents to support their claim. They mentioned previous importations and clearances of the goods under heading 85.47, emphasizing the consistency in classification at various ports and Customs Houses. The judgment in XL Telecom P. Ltd. v. Union of India was cited as a precedent where goods similar to the present case were classified under heading 85.47, emphasizing the acceptance of such classification by the Revenue. The petitioners argued that the Revenue's circular and acceptance of the judgment indicated a uniform classification under heading 85.47, irrespective of the form in which the goods were imported.

Judgment Analysis:
The High Court analyzed the contentions raised by the petitioners and referred to the judgment in XL Telecom P. Ltd. v. Union of India to address the classification issue. The Court highlighted the principle of "Generalia Specialibus non Derogant" and the importance of how the goods were identified by users in determining classification. The Court noted that the goods imported by the petitioners were for jointing and terminating cables, aligning with the classification under heading 85.47. The Court emphasized the acceptance of the judgment in XL Telecom P. Ltd. by the Revenue, indicating a consistent classification under heading 85.47. The Court concluded that the impugned order, classifying the goods under heading 39.26, could not withstand legal scrutiny, considering the uniform classification under heading 85.47. Therefore, the Court allowed the petition, quashed the impugned order, and made it absolute in favor of the petitioners.

This detailed analysis of the judgment reflects the Court's thorough consideration of the classification issue under the Customs Tariff Act, past practices, precedents, and expert opinions to arrive at a reasoned decision in favor of the petitioners.