2024 (12) TMI 1207 - AT - Customs

Eligibility of Concessional rate of duty applicable to melting scrap - rejection of certificate dated 15.06.2004 produced by the appellant - mis-declaration of ingots and flats of alloy steel as heavy metal scrap - Confiscation of imported goods - Department believed that the imported goods were not eligible for concessional rate of duty applicable to melting scrap and, therefore, 100% physical examination of the goods was conducted in the presence of two independent witnesses. HELD THAT - One of the grounds taken in the appeal is that the Additional Commissioner had no authority in law to change the classification of the imported goods from heavy melting scrap to ingots and flats. It is not possible to accept this submission. Apart from the fact that the appellant failed to substantiate this ground, the Additional Commissioner does have the power to determine the classification of the imported goods. In the present case, 100% physical examination of the goods was conducted and thereafter reports were also called from the examiner. This finding of the Additional Commissioner has been confirmed by the Commissioner (Appeals). Apart from making a bald statement that the Commissioner (Appeals) failed to appreciate the contention raised by the appellant, this finding has not been seriously disputed by the appellant. There is, therefore, no infirmity in the order passed by the Commissioner (Appeals) - The appeal is, accordingly, dismissed.

Summary

Issues: Appeal against order quashing the order passed by the Commissioner of Customs (Appeals) and imposition of redemption fine, differential customs duty, and penalty under the Customs Act, 1962. Authority of Additional Commissioner to change classification of imported goods from heavy melting scrap to ingots and flats.

Analysis:
1. The appellant, M/s Addi Alloys (P) Ltd., sought the quashing of the order passed by the Commissioner of Customs (Appeals) confirming the order passed by the Additional Commissioner. The Additional Commissioner had confiscated the goods imported under the Bill of Entry, imposed a redemption fine of Rs. 1,00,000/-, and assessed the imported goods at Rs. 7,02,625/-, confirming the differential customs duty with a penalty under the Customs Act, 1962.

2. The department conducted a 100% physical examination of the imported goods in the presence of independent witnesses, leading to the conclusion that the goods were ingots and flats of alloy steel, not heavy melting scrap. A show cause notice was issued to the appellant, who failed to substantiate the mis-declaration. The Additional Commissioner re-determined the assessable value and confirmed the demand of differential customs duty.

3. The appellant filed an appeal before the Commissioner (Appeals), who found no reason to interfere with the findings of the Additional Commissioner. The Commissioner emphasized the thorough examination process and the lack of rebuttal from the appellant regarding the mis-declaration of goods.

4. The appellant contended that the Additional Commissioner lacked the authority to change the classification of the imported goods. However, the Tribunal held that the Additional Commissioner did have the power to determine the classification, especially after a detailed physical examination and reports from the examiner. The Tribunal found no serious dispute from the appellant regarding this finding.

5. Ultimately, the Tribunal dismissed the appeal, stating that there was no infirmity in the order passed by the Commissioner (Appeals). The appellant's failure to substantiate their grounds and the thorough examination process supported the decision to uphold the original order.

6. In conclusion, the Tribunal upheld the authority of the Additional Commissioner to change the classification of imported goods based on a thorough examination process, and the appeal against the order confirming the differential customs duty and penalty was dismissed.