2010 (4) TMI 493 - AT - Central Excise

Stainless Steel scrap - The appellants imported stainless steel melting scrap and claimed the benefit under Notification No. 21/2002-Cus. dated 1-3-2002. A show-cause notice was issued for differential duty stating that the imported goods are covered under Entry No. 202. On adjudication, duty demand was confirmed and differential duty was demand. On an appeal, the duty demand was upheld by the Commissioner (Appeals). Held that - duty reduced to nil for SI. No. 200 in 2008 to improve raw material supply. Assessee can claim concession more beneficial if there exist two exemptions. Exemption allowed.

Summary

Issues:
Interpretation of exemption notification - Whether goods imported are covered under Entry No. 200 or Entry No. 202 of Notification No. 21/2002-Cus.

Analysis:
The appellants imported stainless steel melting scrap and claimed benefits under Notification No. 21/2002-Cus. The department contended that the goods fell under Entry No. 202 of the notification. Initially, Bills of Entry were assessed provisionally, followed by a show-cause notice for differential duty. The duty demand was confirmed upon adjudication and upheld by the Commissioner (Appeals), leading to the appellants' appeal.

The appellant's advocate argued that 'steel' in Entry Serial No. 200 includes 'stainless steel,' emphasizing that specific overrides general when multiple entries in an exemption notification cover a product. The advocate cited legal precedents to support the argument that the appellants could choose the more beneficial exemption if multiple options were available.

Conversely, the department's representative contended that the exemption notification clearly distinguished goods under different entries, asserting that the goods imported by the appellants fell under Entry No. 202, not Entry No. 200.

The Tribunal analyzed the legal provisions of Notification No. 21/2002 concerning the entries for melting scrap of iron or steel and stainless steel scrap. Changes in tariff rates and descriptions were highlighted from pre-2004 to post-2008 to determine the applicability of the entries.

The Tribunal considered the definitions of 'steel' and 'stainless steel' under Customs Tariff Chapter 72, noting that 'steel' encompasses 'stainless steel' based on carbon and chromium composition. The legislative intent to improve raw material supply by reducing duty on steel melting scrap supported the appellant's argument that stainless steel was included in Entry No. 200.

Referring to legal precedents, the Tribunal affirmed that the appellant could claim the more beneficial exemption between Entry No. 200 and Entry No. 202. Citing relevant case laws, the Tribunal concluded that the appellants were entitled to exemption under Entry No. 200 or 202 based on the principle that the assessee can claim the more advantageous benefit.

Ultimately, the Tribunal set aside the impugned order, allowing the appeal with consequential relief in favor of the appellants. The judgment was pronounced on 22-4-2010 by the Tribunal.