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TMI Blog2024 (8) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... on of Iron Ore Fines for export. In the present case, since as per the certificate produced by the appellant the percentage of Fe content works out to less than 58%, therefore, in terms of Notification No. 15/2016-Cus. dated 01.03.2016, when Fe content is below 58%, the appellant is not liable to pay export duty on the exported goods. The impugned order as well as the order of finalization of the shipping bill set aside - matter remanded back to the adjudicating authority for finalization of provisional assessment. Upon finalization, excess duty, if any, paid by the appellant shall be refunded to them within one month of finalization of such assessment. Appeal allowed by way of remand. - SHRI ASHOK JINDAL, MEMBER (JUDICIAL) AND SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL) Shri Indranil Banerjee, Advocate - For the Appellant Shri Subrata Debnath, Authorized Representative Along with Shri Ashish Mishra, Authorized Representative - For the Respondent ORDER The appellant has filed this appeal against the impugned order wherein assessment of the shipping bill has been challenged by the appellant. 2. The facts of the case are that the appellant is an exporter of Iron Ore Fines. They exported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... below 62%. 5. Upon receipt of the test report from CCL and M/s. Inspectorate Griffith India Pvt. Ltd., the samples were found to be containing Fe content of 58% or more but below 62%, as mentioned in the table given below (ref. paragraph 3 of the Order-in-Appeal dated 31.12.2020): - Shipping Bill No. Date Provisional Fe/Moisture % Final Fe/Moisture % (As per CRL report) Final Fe (on Dry basis)/ Moisture % (As per load port analysis report) 4682367 dated 11.03.2017 61.00/6.00 62.22/7.24 5.1. Based on the load port certificate of quality and certificate of weight, both dated 25.03.2017, final commercial invoice was raised by the appellant, with necessary price adjustments, as per Clause 5 of the said contract. 5.2. Based on the load port test reports issued by M/s. Inspectorate Griffith India Pvt. Ltd., final commercial invoice and other final documents, the original authority made final assessment of the duty without allowing the benefit of nil rate of duty under the said Notification as Fe content was found to be more than 58% but below 62%. 6. Aggrieved from the said finalization, the appellant filed an appeal before the Ld. Commissioner (Appeals) on the following grounds: - (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the Hon ble Apex Court in the case of Union of India v. Gangadhar Narsingdas Aggarwal [1997 (89) E.L.T. 19 (S.C.)] which has clearly laid down that classification of Iron Ore Fines as per Ferrous (Fe) content was to be done on WMT basis, i.e., on as presented for export basis and it is not open to the adjudicating authority to hold to the contrary and effect assessment of appellant s export goods on the basis of Fe content arrived at on Dry Metric Tonne (DMT) basis. 9.2. He further submitted that the authorities below have not complied with the C.B.E.C. Circular No. 04/2012-Cus. dated 17.02.2012. 9.3. Therefore, he prayed that the impugned order is to be set aside and consequently, the assessment of shipping bill is to be done on Wet Metric Tonne (WMT) basis and benefit of the same is to be granted to the appellant; therefore, it is submitted that no demand is payable by the appellant. 10. On the other hand, the Ld. Authorized Representative appearing for the Revenue supported the impugned order. 11. Heard the parties. 12. The sole issue before us is whether for deciding the classification and rate of duty payable, the Fe percentage of Iron Ore Fines is to be determined on Dry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harging of export duty the assessment of Iron ore, determination of Fe contents is required to be made on Wet Metric Ton (WMT) basis which in other words mean deducting the weight of all impurities (inclusive of moisture) out of the total weight/Gross Weight to arrive at Net Fe contents. 9.1 The rate of duty was being fixed, then and also now, on the basis of percentage of iron(Fe) in the ore. The higher is the percentage, more the rate of duty. In WMT the percentage of iron is taken from the material as it has been presented for exports, which contain all types of impurities Moisture, Sulphur, Phosphorus, Aluminium trioxide etc. The percentage of impurities is substantial. If the percentage of Fe is taken after deducting all quantity of impurities, percentage of Fe will be lower. Therefore, the rate of duty will be lower. The Supreme Court directed that the percentage of Fe will be taken out of total material presented for export after deducting all the impurities including moisture. 1. This has been followed in the following judicial pronouncements : i) SOCIEDADE DE FOMENTO INDUSTRIAL PVT. LTD.- 1987 (30) E.L.T. 686 (Goa High Court) [Para7] where similar view was taken as under : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant aspect of assessment, namely, determination of Fe content for the purpose of classification/rate of duty applicable. 9.3 It would not be out of place to mention here that the ld. Commissioner of Customs, Mangalore in Para 22 of his Order-In- Original No.02/2010 under C. No. VIII/10/22/2009/Adjn dated 28.3.2010, has recorded as follows : 22. To resolve the issue relating to the moisture content in the sample in lieu of the various judicial pronouncements and to retain the relevance of the test report given by the Chemical Examiner, Custom House, Cochin this office had earlier written to the Central Revenue Control Lab, New Delhi who has opined vide his letter dated 22.01.2009 that the iron content in samples in received basis can be calculated from iron content on dry basis if the moisture content in the samples as received basis is known: Iron content = Fe x (100-M) / 100 (on as received basis) Where Fe is % age of iron content on dry basis, M is moisture content in the sample. This method although not the best, was temporarily adopted by the department in previous orders on similar matters so as to meet the requirements of various judicial pronouncements. [we are attaching the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be calculated on the Dry Metric Ton (DMT) basis to be effective from 01.05.2022. Hence, according to the petitioners there could not have been any adoption of the DMT method in respect of any assessment for the period prior to 1 st May 2022. 63. In the light of the above discussion, Court ordered the petition is partly allowed in terms of the following directions : I. Insofar as the assessments in relation to the period prior to 1 st May 2022 are concerned, they shall be governed by the principles of law in regard to the classification as laid down by the Supreme Court in Union of India vs. Gangadhar Narsingdas Aggarwal (supra), as clarified by the communication dated 17 February 2012, of the Tariff unit of the Ministry of Finance Department of Revenue (CBEC) Customs-IV Division. II. The GA Circular No. 2/2019 dated 12/15 April 2019, being not issued under Section 151-A of the Customs Act, same cannot form the basis of any assessment. III. In view of our above conclusion, we set aside the impugned orders-in-original dated 17 March 2022 and 13 March 2022 passed by the Assistant Commissioner of Customs. IV. We order a remand of the matter in both the cases to the Assistant Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e above discussion, we set aside the impugned order as well as the Finalisation order dated 10.02.2017 and remand the matter back to the adjudicating authority to finalise the provisional assessment on the basis of the above directions. Upon finalisation, the appellant is eligible for the refund of the excess duty paid at the time of export. 8. The appeal is disposed on the above terms. 13. The appellant has filed the Certificate of Quality issued by M/s. Inspectorate Griffith India Pvt. Ltd. wherein percentage of Fe content on Wet Metric Tonne basis has been shown as 62.22 and percentage of moisture content as 7.24 . If the same is reduced, the Fe content would come out to below 58%, as appears from the detailed calculation submitted by the appellant, which is reproduced below: Sl. No. Shipping Bills No. Fe% on DMT basis Moisture % Fe% on WMT basis as per ASTM Conversion Formula Remarks 1. 4682367 62.22 7.24 62.22x (100-7.24)/100 = 57.71 14. In these circumstances, we hold that since as per the certificate produced by the appellant the percentage of Fe content works out to less than 58%, therefore, in terms of Notification No. 15/2016-Cus. dated 01.03.2016, when Fe content is belo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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