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TMI Blog2016 (3) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... d justifies the bonafide of appellant being an actual user. Therefore, the goods imported are "Heavy Melting Steel Scrap" and the clearance is allowed after mutilating the goods under customs supervision followed by the decision of Hon'ble Madras High Court, uphelded decision of the Tribunal in the case of COMMR. OF CENTRAL EXCISE, MADURAI Versus SRI RENGA STEEL CORPORATION 2014 (9) TMI 522 - Madras High Court. - Decided against the Revenue - Appeal No. C/40116/2013 - FINAL ORDER No.40313/2016 - Dated:- 22-2-2016 - SHRI R. PERIASAMI, TECHNICAL MEMBER AND SHRI P.K. CHOUDHARY, JUDICIAL MEMBER For the Petitioner : Ms. Indira Sisupal, AC (AR) For the Respondent : Shri S. Krishnanandh, Advocate ORDER PER R. PERIASAMI Revenue preferred appeal against Commissioner (Appeals) order dt.29.10.2012. 2. The brief facts of the case are that respondent filed Bill of Entry No.7523046 dt. 30.7.2012 for import of goods declaring as Heavy Melting Steel Scrap [HMSS] of quantity of 518.38 MTs . On examination the goods were found to be 10% scrap and 90% secondary welded pipes . Samples were drawn and sent to private laboratory viz. Sargam Laboratory Pvt. Ltd. Based on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th Central Excise for manufacture of sponge iron, TMT bars, billets etc. and they are actual user and the HMS scrap is the raw material for manufacture of finished goods. Therefore the goods were imported as scrap for their own use in their foundry as inputs for manufacture of TMT bars billets etc. He further submits that the test report issued by Sargam Laboratory Pvt. Ltd. is not approved by the Customs or CRCL. He further submits that the goods were imported in July 2012 and is still in the custody of Customs. He submits that the Commissioner (Appeals) ordering for mutilation of the goods before clearance is well within the law. He relied the following citations. 1) Sri Renga Steel Corporation Vs CCE Customs Madurai-2006 (206) ELT 993 (Tri.-Chennai) 2) CCE Madurai Vs Sri Renga Steel Corporation-2014 (305) ELT 377 (Mad.) 3) P.A.B. Traders Vs CC Cochin-2010 (261) ELT 260 (Tri.-Bang.) He submits that in the above Tribunal's decisions, the Tribunal allowed the appeal and also allowed the goods to be cleared as scrap after mutilation and on payment of appropriate duty. He also submits that the Tribunal's order in the case of Sri Renga Steel Corporation Vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded that, as there was no misdeclaration of the goods by the party, the Commissioner s order confiscating the goods and imposing penalty on the party cannot be sustained. In the case of Madanlal Steel Industries (supra), it was held by the Hon ble Supreme Court that multilation of goods misdeclared by the importer was not to be permitted under Section 24 of the Customs Act. In the instant case, therefore, the primary question is whether the appellants can be held to have misdeclared the goods. If it is held that they misdeclared the goods, they cannot be permitted to mutilate them. In one of the invoices issued by the supplier, the goods was described as M.S. G.I, WIRE SCRAP , while the other invoice described the goods as G.I. M.S.WIRE SCRAP . Both the Bills of Entry declared the goods as G.I. M.S. WIRE SCRAP . The goods were, admittedly, covered under a HIGH SEAS SALES AGREEMENT, which described the goods as LMS-LIGHT MELTING SCRAP . M/s. Aruna Machine Tolls Import and Export, Madurai, the High Seas buyers, in their statement, confirmed that the goods were purchased for melting purpose. This statement was never retracted. It was not contradicted by the department either ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or permission to mutilate the goods, it need not necessarily be held that they are conceding misdeclaration of the goods as scrap . The plea for mutilation can as well be discerned as a gesture to reassure the department that the goods would only be used for melting purpose. The appellants can be seen as acting without intent to evade Customs duty. The ruling handed down by the Apex Court in the case of Madanlal Steel Industries (supra) is against mutilation of misdeclared goods. Now that we have found no misdeclaration by the importer, the plea made by the appellants for permission to mutilate the goods cannot be defeated on the strength of the said ruling, particularly when the Revenue has not cited any judicial authority in support of their case that any mutilation of goods, not claimed at the time of importation, cannot be allowed at a later stage. 6. For the reasons noted above, we are of the view that the appellants should be allowed to clear the goods in mutilated condition, on payment of duty as applicable to scrap. The goods were confiscated under Section 111 of the Customs Act on the ground of misdeclaration and the penalty was imposed on the importer under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said circumstances, the Court can come to a conclusion that the things which are in question cannot be couched as usable things. 12. The Appellate Tribunal, after considering the available materials on record, has rightly found that the things in question are nothing but scrap materials. Under the said circumstances, the respondent has been directed to pay duty on the basis of scrap materials and in view of the discussions made earlier, this Court has not found any acceptable force in the contention putforth on the side of the appellant and altogether the present Civil Miscellaneous Appeal deserves to be dismissed. 13. In fine, this Civil Miscellaneous Appeal deserves dismissal and accordingly is dismissed without costs. The ratio of the High Court decision and this Tribunal's decision (supra) is clearly applicable to the present case as the issues are identical and also considering the fact that there is no misdeclaration by appellant as seen from the purchase order/sales contract and sales confirmation report and pre-shipment inspection certificate, wherein appellants have placed orders for supply of 1000 MTs of HMSS, and imported the said goods and cleared ..... X X X X Extracts X X X X X X X X Extracts X X X X
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