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TMI Blog2021 (10) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... of the documents submitted by the appellant, the Department was of the view that the imported goods have been subjected to certain physical processes to remove foreign matter and that the subject goods have lost the characteristics of ore and are 'concentrate' and hence, not eligible for exemption of CVD. The Bills-of-Entry were assessed by levying CVD at the rate of 12% without extending the benefit of the exemption Notification. The appellant paid the total Duty of Rs. 94,60,772/- for the above Bills-of-Entry. The appellant vide letters dated 23.01.2013 and 08.02.2013 contended that the consignments imported by them were Zirconium sand; that these were ore and cannot be treated as 'concentrate' to deny exemption of CVD as per Sl. No. 56 of Notification No.12/2012-C.Ex. dated 17.03.2012. 3. After due process of law, the Original Authority vide Order-in-Original No. 20629/2013 dated 05.04.2013 held that the goods imported are Zirconium concentrates and not Zirconium ores. The exemption under Sl. No. 56 of the Central Excise Notification No. 12/2012-C.Ex. was denied and the collection of CVD at the rate of 12% for the goods was sustained. Against this order, the appellant filed app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Table, subject to any of the conditions, specified in the Annexure to this notification, the condition number of which is mentioned in the corresponding entry in column (6) of the said table. TABLE S. No. Chapter or Heading or Sub-heading or tariff item Description of goods Standard rate Additional duty rate Condition No. (1) (2) (3) (4) (5) (6) 1. 1 Animals and birds imported by zoo Nil - - . . . . 117. 2601 to 2617 All goods 2.5% - - (Emphasis applied) "[Notification No. 12/2012-C.E., dated 17-3-2012] Exemption and effective rates of duty for specified goods of Chapters 1 to 98 - Jumbo Exemption - Notification Nos. 3/2005-C.E., 3/2006-C.E., 4/2006-C.E., 5/2006-C.E., 6/2006-C.E. and 10/2006-C.E. replaced In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) and in supersession of (i) notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 3/2005-Central Excise, dated the 24th February, 2005, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pecified. Explanation 2. - For the purposes of this notification, "brand name" means a brand name, whether registered or not, that is to say, a name or a mark, such as a symbol, monogram, label, signature or invented words or any writing which is used in relation to a product, for the purpose of indicating, or so as to indicate, a connection in the course of trade between the product and a person using such name or mark with or without any indication of the identity of that person. TABLE Sl. No. Chapter or heading or sub-heading or tariff item of the First Schedule Description of excisable goods Rate Condition No. (1) (2) (3) (4) (5) 1 0402 91 10 0402 99 20 Condensed milk Nil - . . . . 56 2601 to 2617 Ores Nil - (Emphasis applied) 4.2.1 It is submitted by the Learned Counsel that the goods imported by the appellant are only ore and not concentrate. In the Bill-of-Entry, the goods are declared as Zirconium Sand. It is alleged by the Department that the goods imported are 'concentrate' and hence not eligible for the exemption of CVD. This dispute appears to have arisen after the introduction of Cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew to economical transport. Processes to which products of headings 26.01 to 26.17 may have been submitted include physical, physico-chemical or chemical operations, provided they are normal to the preparation of the ores for the extraction of metal. With the exception of changes resulting from calcination, roasting or firing (with or without agglomeration), such operations must not alter the chemical composition of the basic compound which furnishes the desired metal. The physical or physico-chemical operations include crushing, grinding, magnetic separation, gravimetric separation, flotation, screening, grading, agglomeration of powders (e.g., by sintering or pelleting) into grains, balls or briquettes (whether or not with the addition of small quantities of binders), drying, calcination, roasting to oxidise, reduce or magnetise the ore, etc. (but not roasting for purposes of sulphating, chloridating, etc.) The chemical processes are aimed at eliminating the unwanted matter (e.g., dissolution). Concentrates of ores obtained by treatments, other than calcining or roasting, which alter the chemical composition or crystallographic structure of the basic ore are excluded (gen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sses the impurities can be removed and will oxidise the ores to get more Zirconium Oxide in the concentrate. That the Department has not been able to establish that the subject goods have undergone any such special treatment processes. The allegation of the Department that the imported goods were subjected to certain physical processes in the nature of cleaning, washing, drying, etc., so as to remove the foreign matter and that hence they have lost their character of ores and are in the nature of concentrates, is without any legal basis. 4.7.1 To support his arguments, he relied upon the decision of the Tribunal in the case of M/s. Classic Microtech Pvt. Ltd. v. Commissioner of Cus., Ahmedabad reported in 2012 (285) E.L.T. 418 (Tri. - Ahmd.). In the said case, it was observed that the Indian Standard IS : 9007-1978 (Reaffirmed 2003) has described that Zircon sand (ore) will normally have about 65% of Zirconium Oxide (ZrO2). That when the goods contain 95% of Zirconium oxide it has to be considered as 'concentrate'. The Tribunal in the said case was assisted by the analysis report wherein it was reported that the Zirconium Oxide in the imported goods was only around 65%. In the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 007 showed that the composition of ZrO2 (Zirconium Oxide) content is only 63.86% and that the imported goods are 'ore'. That the Department has not sent the sample of the present imports for analysis so as to examine the Zirconium Oxide content. 4.9 The Adjudicating Authority has relied on the Board Circular No. 09/2012-Cus. dated 23.03.2012. This Circular is not at all relevant to the facts of the case. 5. He prayed that the appeal may be allowed. 5.1 Learned Authorized Representative Shri R. Rajaram, appearing on behalf of the Department, supported the findings in the impugned order. He referred to the Board Circular No. 09/2012-Cus. dated 23.03.2012 wherein the issue of applicability of exemption under Sl. No. 4 of Central Excise Notification No. 04/2006-C.E. dated 01.03.2006 was examined. That the issue was with regard to import of ore/concentrate and in the said Circular it is clarified that 'ores' and 'concentrates' are two distinct products. That the term 'ore' applies to metalliferous minerals associated with the substances in which they occur with which they are extracted from the mine. It applies to native metals in their gangue (e.g. metalliferous sands). That the ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised whether on imports of Ore Concentrate classifiable under Chapter 26 of the First Schedule to the Customs Tariff Act, 1975, the benefit that is admissible to "Ore" under Serial Number 4 of the Notification No. 4/2006-C.E., dated 1-3-2006 can be granted to the "Concentrate" of that Ore. The issue was taken up for discussion during the Conference of Chief Commissioners of Customs on Tariff and allied matters held in May 2011. 2. The matter related to : (a) whether the term 'Ore' includes Concentrate, and (b) Whether insertion of Chapter Note 4 in the Chapter 26 will have any impact on the admissibility of notification benefit to Concentrates, was examined. The Conference noted the HS definitions of Ore and Concentrate are as follows : "The term 'ore' applies to metalliferous minerals associated with the substances in which they occur and with which they are extracted from the mine; it also applies to native metals in their gangue (e.g. metalliferous sands"). "The term 'concentrates' applies to ores which have had part or all of the foreign matter removed by special treatments, either because such foreign matter might hamper subsequent metallurgical operations or with a view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to deem the process of converting "Ores" into "Concentrates" as a process amounting to manufacture. Both ores and concentrates are classifiable under Chapter 26 and while the term 'Ore' is defined in Note 2 of the said chapter, the term 'concentrate' is not. HSN Explanatory Note spell out the scope of the term "Concentrate" as under : "For the purposes of Headings 2601-2617, the term 'concentrates' applies to ores which have had part or all of the foreign matter removed by special treatments either because such foreign matter may hamper subsequent metallurgical operations or with a view to economical transport." From the above definition, it is clear that removal of part or all of foreign material is envisaged for conversion of ores into concentrates. Ministry of Mines have clarified that no special treatment is involved in the crushing and screening of ore and the end-product can be termed as a concentrate only when the grade of ore is sufficiently improved through beneficiation. Federation of Indian Mineral Industries have also pointed out that several processes (in addition to crushing and screening) such as milling, hydraulic separation, magnetic separation, floatation & Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e subject goods have undergone any special treatment. Mere washing, cleaning and drying cannot be considered as special treatment. In the absence of any evidence to show that the subject goods have undergone some special treatment process and also in the absence of any analysis report, we have no other option but to rely on the chemical analysis report of the overseas supplier filed by the appellant along with the Bills-of-Entry. In these certificates of analysis, the content of Zirconium Oxide is shown to be around 65% only. There is no expert evidence adduced by the Department to rebut these chemical analysis reports furnished by the appellant. 12. The Tribunal in the case of M/s. Classic Microtech Pvt. Ltd. (supra) had considered the very same issue in respect of the earlier Notification No. 04/2006-C.E. In the said case, samples were drawn and sent to CRCL, which were forwarded to Indian Rare Earths Ltd., Research Centre, Kollam, for analysis. In the report, the samples were found to have ZrO2 content of 62.9%. In paragraph 10, the Tribunal has reproduced the letter issued by Indian Rare Earths Ltd., Research Centre, Kollam to the Director of Revenue Laboratories, responding t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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