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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 ..... y they have failed to take such steps in respect of the present consignments. In the absence of such opinion by an expert, it is not possible to ascertain the nature of the goods as to whether they are ores or concentrates. Even in the Tariff, ores and concentrates fall under the same Chapter Heading. Similarly, the Customs Notification No. 12/2012-Cus. dated 17.03.2012 grants exemption from Basic Customs Duty of all goods under Chapter 26 (2601 to 2607) i.e., to both ores and concentrates, in terms of Sl. No. 117. The Department cannot decide that the nature of the goods to be concentrate merely by stating that certain processes were undertaken by the appellant. As per the HSN Explanatory notes to Chapter 26, the term concentrate applies to ores which have had part or all of the foreign matter removed by special treatment. In the present case, there is no evidence to show that the subject goods have undergone any special treatment. Mere washing, cleaning and drying cannot be considered as special treatment - There is no expert evidence adduced by the Department to rebut these chemical analysis reports furnished by the appellant. Only on the fact that the goods have u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. The appellant paid the total Duty of ₹ 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 appeal before the Commissioner (Appeals), who vide order impugned herein upheld the view taken by the Original Authority. Hence, this appeal. 4.1 Learned Counsel Shri S. Muthu Venkataraman appeared and argued on behalf of the appellant. There is no dispute with regard to the exemption availed in regard to Basic Customs Duty as the Customs Notification No. 12/2012-Cus., in terms of Sl. No. 117 of the Notification, exemp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specified against serial number 296 and 297 of the said Table after the 31st day of March, 2013. Explanation 1. - For the purposes of this notification, the rates specified in column (4) of the said Table are ad valorem rates, unless otherwise specified. 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 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44, even if they are intended for non-metallurgical purposes, and (B) Have not been submitted to processes not normal to the metallurgical industry. The term ores 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). Ores are seldom marketed before preparation for subsequent metallurgical operations. The most important preparatory processes are those aimed at concentrating the ores. For the purposes of headings 26.01 to 26.17, 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 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), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ore and that several processes such as milling, hydraulic separation, magnetic separation, floatation and concentrate thickening have to be undertaken for converting ores into concentrates. 4.5 It is submitted by him that the Department has proceeded to conclude that the imported Zircon Sand is in the nature of concentrate only for the reason that the subject goods have undergone certain processes like cleaning, washing and drying. That because of mere cleaning, washing and drying operations without subjecting the product to special treatment processes, as mentioned in the HSN Explanatory Note and the C.B.E.C. Instructions dated 17.02.2012, the ores cannot be treated as concentrates. 4.6 Further, as per the HSN Explanatory Note, calcination and roasting are important processes for converting ores into concentrates and only by these processes 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Department has filed an appeal against the said order of the Tribunal before the Hon ble Supreme Court as reported in 2015 (321) E.L.T. A204 (S.C.) and the appeal has been admitted. A similar issue was considered by the Tribunal in the case of M/s. Shree Bhavani Minerals v. Commissioner of Central Excise, Goa reported in 2019 (366) E.L.T. 1041 (Tri. Mumbai). That in the said case, the goods under question was iron ore and eligibility of exemption under Notification No. 62/2007-Cus. dated 03.05.2007. The Tribunal held that the benefit of the Notification is applicable to concentrates also. 4.8 He again adverted to the Analysis Certificate of the overseas supplier furnished along with the Bill-of-Lading; that the said certificate shows that the Zirconium Oxide (ZrO2) content is only 65%. For the previous imports, the test report dated 02.11.2007 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. date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said Circular was issued for clarifications after the introduction of Chapter note 4 in Chapter 26, which reads as under: 4. In relation to products of this Chapter, the process of converting ores into concentrates shall amount to manufacture . The above Note 4 was introduced in Chapter 26 under Central Excise Tariff, which made the activity of converting ores into concentrates a manufacturing activity and liable to Excise Duty. The Adjudicating Authority has quoted this Circular in paragraph 11 of the Order-in-Original, which is the main basis for the finding that the imported goods are not ore but concentrate. The Circular reads as under: [Circular No.9/2012-Cus., dated 23-3-2012] Subject : Applicability of exemption under Sr. No. 4 of the Notification 4/2006 - C.E., dated 1-3-2006 on import of Ore Concentrates - Regarding. Doubts have been raised 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lable only to imported ore and not concentrate. 8.2 In the Circular F.No. 332/1/2012-TRU dated 17.02.2012, clarification has been issued that processes in the nature of crushing, screening, sizing or washing will not result in concentrate, which is leviable to Central Excise Duty. That the term concentrate applies to ores which have had part or all of the foreign matter removed by special treatment. The Circular reads as under: [Instructions F.No. 332/1/2012-TRU dated 17-2-2012] Subject :Dutiability of iron ore and iron ore concentrates - Clarification regarding. A reference has been received from Bhuwaneswar Zone seeking clarification on the issue of whether Iron ore lumps and fines are dutiable as concentrates when subjected to crushing, screening, sizing or washing etc. 2. In Budget 2011, a Note was inserted in Chapter 26 of the First Schedule to the Central Excise Tariff 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 No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e previous imports, we do not understand why they have failed to take such steps in respect of the present consignments. In the absence of such opinion by an expert, it is not possible to ascertain the nature of the goods as to whether they are ores or concentrates. Even in the Tariff, ores and concentrates fall under the same Chapter Heading. Similarly, the Customs Notification No. 12/2012-Cus. dated 17.03.2012 grants exemption from Basic Customs Duty of all goods under Chapter 26 (2601 to 2607) i.e., to both ores and concentrates, in terms of Sl. No. 117. The Department cannot decide that the nature of the goods to be concentrate merely by stating that certain processes were undertaken by the appellant. 11. As per the HSN Explanatory notes to Chapter 26, the term concentrate applies to ores which have had part or all of the foreign matter removed by special treatment. In the present case, there is no evidence to show that the 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 i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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