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TMI Blog2024 (8) TMI 911X X X X Extracts X X X X X X X X Extracts X X X X ..... sults of these 12 samples taken from the imported goods in 12 containers cannot be treated as hazardous goods . In fact, these products fall appropriately under the category of used oil suitable for recycling. It is found that the authorities below did not examine the various parameters for determination of the issue of classifying the imported goods as off-specification furnace oil/waste oil or hazardous waste in a systematic and detailed manner. Rather they simply went by the wordings mentioned in the test reports, without referring to the specific factors. The appellants on coming to know about the test results had applied for re-testing of samples vide their letter dated 11-7-2022 addressed to the Joint Commissioner, JNCH. However, it is found that the Customs authorities and both the authorities below during adjudication of the case, without even recording the date of communication of the first test results by the department to the appellants importer; then the date of receipt of the request letter from the appellants by the Customs authorities, should have taken a reasoned view on allowing the facility of second test or retesting as per procedure. However, in complete disrega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clared by the appellants or diesel oil . Upon testing the goods, it was found that the imported goods are not diesel, and accordingly DRI had withdrawn the embargo on the said goods and allowed the same for further clearance by the jurisdictional customs authorities. However, JNCH customs authorities had raised an objection regarding the goods treating the same as hazardous substance and thereby treating the said imports as being prohibited under the provisions of Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008. 2.2 The appellants by their letter dated 11-7-2022 had requested to release of goods covered under B/Es No. 8110603, dated 1-4-2022 and No. 8169028, dated 6-4-2022, as the goods were reported to be fit for refining ; in respect of goods covered under B/Es No. 8066788 and 8066761, both dated 30-3-2022, which are reported as not fit for refining , the appellants importer had requested for re-testing of samples. Further, the appellants had also requested that they do not want show cause notice in the matter, but requested for a personal hearing before the case is decided by the original authority. After giving a personal hearing to the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ular dated 4-6-2001, is not a condition for determining the classification of a hazardous waste, but is only a criterion for determining whether the fuel oil can be re-refined or not. The contention that fuel oil is to be considered as hazardous waste merely because the density exceeds 0.95% is factually erroneous, as commercially available fuel oil supplied by leading suppliers such as Indian Oil Corporation Ltd., Reliance Industries Ltd., Mangalore refinery all have density above 0.95%. On the basis of above facts, Learned Advocate submitted that confiscation of the imported goods and imposition of penalty on the appellants is clearly unsustainable in law. Hence he prayed for setting aside the impugned order. 4. Learned Authorised Representative (AR) for Revenue had reiterated the findings made in the impugned order and stated that the confiscation of the goods by allowing the same on payment of redemption fine and imposition of penalty is on the basis of C.B.I. C. Circular dated 4-6-2001 and the restrictions in terms of Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008. Thus, Learned AR justified the action of Commissioner (Appeals) in confirming the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or any other sum is affected by the origin of such goods; (f) any other specific factor which affects the duty, tax, cess or any other sum payable on such goods, and includes provisional assessment, self-assessment, re-assessment and any assessment in which the duty assessed is nil; Section 17. Assessment of duty. (1) An importer entering any imported goods under section 46, or an exporter entering any export goods under section 50, shall, save as otherwise provided in section 85, self-assess the duty, if any, leviable on such goods. (2) The proper officer may verify the entries made under section 46 or section 50 and the self-assessment of goods referred to in sub-section (1) and for this purpose, examine or test any imported goods or export goods or such part thereof as may be necessary : Provided that the selection of cases for verification shall primarily be on the basis of risk evaluation through appropriate selection criteria. (3) For the purposes of verification under sub-section (2), the proper officer may require the importer, exporter or any other person to produce any document or information, whereby the duty leviable on the imported goods or export goods, as the case ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ported goods, which were initially drawn by DRI, Pune and later the same test results were used by the assessing officers and original as well as appellate authorities in deciding the issues in dispute. 6.4 In this regard we also find that the Central Board of Indirect Taxes and Customs (CBI C) had issued circular is on the various parameters and the facilities for testing furnace oil/waste oil, which have been prescribed after consultation and deliberations with the line Ministry i.e., the Ministry of Environment and Forests. Furnace oil/waste oil - Parameters and facilities for testing : Circular No. 33/2001-Cus., dated 4-6-2001 F. No. 405/09/2000-Cus III Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Parameters and facilities for testing furnace oil/waste oil - regarding. I am directed to invite your attention to Board's Circular No. 106, dated 22-12-2000 issued from F. No. 405/09/2000-Cus. inter alia enclosing the minutes of meeting of experts organized by Ministry of Environment to lay down certain guidelines for testing of fuel oil, LSWR LSHS. From the feedback received, from the field formations certai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2) Viscosity 80 to 125 centistokes (Grade MV 1), (3) Viscosity 125 to 180 centistokes (Grade MV 2) , and (4) Viscosity 180 to 370 centistokes (Grade HV). 5. The above four grades could be tested for total sulphur per cent by weight (1) Grade LV viscosity up to 80 centistokes should confirm to a maximum of 3.5% sulphur by weight. (2) Grade MV1 viscosity 80 to 125 centistokes and Grade MV2 from 125 to 180 centistokes viscosity should confirm to a maximum total sulphur of 4% by weight. (3) Grade HV from 180 to 370 centistokes viscosity should confirm to a maximum total sulphur of 4.5% by weight. 6. Products/furnace oil not to confirming to the respective sulphur percentage by weight shall be considered as off specification furnace oil/waste oil. 7. Products/furnace oil confirming to the sulphur percentage for the grades mentioned above should be further tested for flash point. (1) Products/furnace oil having less than 66 C flash point should be considered as off specification furnace oil/waste oil. (2) Products/furnace oil having a minimum of 66 C flash point should be further tested for calorific value. (i) Products/furnace oil having calorific value less than 10,000 Kcal/Kg should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oil (ii) Off-specification product such as (a) Off-specification fuel oil (b) waste/used oil, fit for refining (c) hazardous waste, the import of which is prohibited. These procedure involved testing of 10 specific factors/features such as the following : (1) Acidity (2) Ash content (3) Sediment (4) Water (5) Viscosity (6) Total sulphur percentage (7) Flashpoint (8) Calorific value (9) Absence of heavy metals concentration (10) Presence of Poly Chlorinated Biphenyls (PCB). The first of 4 features/specifications for which testing is conducted is in the nature of minimum screening tests. If the imported product/furnace oil fails the screening test, then the imported goods are declared as Off-specification furnace oil/waste oil. However, if they pass through a screening test, then the remaining BIS specifications are required to be tested one by one, as given in the said instructions. In each of the subsequent specified features, if the commodity fails or does not fulfil the threshold limit prescribed, by testing one-by-one, further testing is done on other features/specifications and in the end, samples tested and found to be positive for organic halides and PCBs shall be classified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay take a reasoned view in case the importer or his authorized representative Customs Broker is unable to do so for reasons beyond his control. (c) Where the Additional/Joint Commissioner of Customs grants an opportunity for a second test, he must clearly indicate in writing the name and address of the laboratory/institution where the second test can be carried out. Such referral for re testing may be made only after being reasonably sure that the desired re-testing facilities exist at the laboratory/institution. (d) Re-test should be made only on the remnants of the samples originally tested or on duplicate representative sealed samples in the custody of the Customs. Further, to avoid delays, samples for second tests shall be marked as immediate before sending to the laboratory. In a case it may so happen that fresh samples have to be drawn, then such sampling should be done in the presence of the importer or his representative/customs broker. (e) The requests for re-test of samples on the ground that the original sample was not representative should be entertained only if the consignment is still in Customs control. At the time of drawing the samples, the importer or his represen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 3 (36) - used oil means any oil - (i) derived from crude oil or mixtures containing synthetic oil including spent oil, used engine oil, gear oil, hydraulic oil, turbine oil, compressor oil, industrial gear oil, heat transfer oil, transformer oil and their tank bottom sludges; and (ii) suitable for reprocessing, if it meets the specification laid down in Part A of Schedule V but does not include waste oil; Rule 3(39) - waste oil means any oil which includes spills of crude oil, emulsions, tank bottom sludge and slop oil generated from petroleum refineries, installations or ships and can be used as fuel in furnaces for energy recovery, if it meets the specifications laid down in Part-B of Schedule V either as such or after reprocessing. SCHEDULE V [See rules 3 (36) and 3 (39)] PART A Specifications of used oil suitable for recycling S. No. Parameter Maximum permissible Limits (1) (2) (3) 1. Polychlorinated biphenyls (PCBs) 2ppm * 2. Lead 100 ppm 3. Arsenic 5 ppm 4. Cadmium+Chromium+Nickel 500 ppm 5. Polyaromatic hydrocarbons (PAH) 6% Part B Specification of fuel derived from waste oil S. No. Parameter Maximum permissible Limits (1) (2) (3) 1. Sediment 0.25% 2. Lead 100 ppm 3. Arsen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 018 Standard RCL/255 NIL 0.04 0.04 NIL 40.23 4 IS 1593:2018 Standard RCL/256 NIL 0.03 0.03 NIL 40.43 5 IS 1593:2018 Standard RCL/257 NIL 0.04 0.04 NIL 40.88 6 IS 1593:2018 Standard RCL/258 NIL 0.04 0.03 NIL 38.75 7 IS 1593:2018 Standard RCL/259 NIL 0.03 0.03 NIL 37.12 Bill of Entry No. 8066761, dated 30-3-2022 1 IS1593:2018 Standard RCL/260 NIL 0.02 0.03 NIL 41.25 2 IS1593:2018 Standard RCL/261 NIL 0.03 0.04 NIL 40.66 3 IS1593:2018 Standard RCL/262 NIL 0.04 0.04 NIL 39.22 4 IS1593:2018 Standard RCL/263 NIL 0.04 0.04 NIL 37.12 5 IS1593:2018 Standard RCL/264 NIL 0. 3 0.04 NIL 38.71 Total Sulphur % by Mass, Max Flash Point by PMCC C Min Calorific Value Gross, kcal/kg Density at 15 C g/cm 3 PAH % mg/kg PCB mg/kg Lead (Pb) mg/kg Chromium Cadmium Nickel mg/kg Arsenic (As) mg/kg (9) (10) (11) (12) (13) (14) (15) (16) (17) 4.5 66 To be reported To be reported - - - - - 0.0024 96.5 8818 1.0844 0.68 ND ND ND ND 0.0016 101.5 8800 1.0848 0.35 ND ND ND ND 0.0023 102.5 8789 1.0854 0.74 ND ND ND ND 0.0014 103.5 8792 1.0854 0.06 ND ND ND ND 0.0079 98.0 8788 1.0839 0.019 ND ND ND ND 0.0203 98.0 8812 1.0841 0.28 ND ND ND ND 0.0088 98.0 8797 1.0838 0.19 ND ND ND ND 0.0033 106.5 8784 1.0861 23.45 ND N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or re-refining. I find that the importer has submitted sale agreement with M/s. Sai Om Petro Specialties Ltd., who is dealing in refining of off specification fuel oil/waste oil, along with copy of Maharashtra Pollution Control Board (MCB) registration Certificate. In view of the same I find that the goods covered under Bills of Entry Nos. 8110603, dated 1-4-2022 and 8169028, dated 6-4-2022 may be released. 7. I find that as per final test report dated 6-6-2022 goods covered under BE Nos. 8066788, dated 30-3-2022 and 8066761, dated 30-3-2022 are not found fit for re-refining. Therefore, I find that the goods under BE Nos. 8066788, dated 30-3-2022 and 8066761, dated 30-3-2022 falls under the category of hazardous waste as per Board Circular 33/2001-Cus., dated 4-6-2001. Accordingly, they cannot be released for home consumption. 8. I find that the importer has requested for re-testing of goods covered under BE Nos. 8066788, dated 30-3-2022 and 8066761, dated 30-3-2022, I find that as per Board Circular No. 30/2017-Cus., dated 18-7-2017 request for a re-test is to be made within a period of ten days from the receipt of the communication of the test results of the first test. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve, goods pertaining to Bills of Entry No. 8066788, dated 30-3-2022 and 8066761, dated 30-3-2022 are waste oil not fit for re-refining. Thus, it obviously falls under the category of hazardous waste and cannot be allowed for home consumption. xx xx xx 6.6 The appellant has contended that in the final test report it is not concluded that samples having Lab Sr. No. 252 to 264 are hazardous waste, but still the OA has concluded without any basis that the goods are hazardous waste. The issue has been discussed in earlier para and hence, needs no further deliberation. 6.7 The appellant has also contended that their request for re-testing of the impugned goods was rejected by the OA on the ground that request for re-test was not made in time as per the time limit in Board Circular, but, there is no mention of any time limit for request for re-test in the Board Circular No. 33/2001-Cus., dated 4-6-2001 and the OA has not mentioned the number of the Board Circular being referred if it is other than the Board Circular No. 33/2001-Cus., dated 4-6-2001. I find that this issue has been squarely dealt with in Para 8 of the impugned order with mention of the specific Circular number on the issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 000-Cus. III), which means that the concerned goods are not fit for re-refining. Officials of Central Excise Customs Laboratory, Vadodara are experts in their field and after testing the samples they have given their expert opinion and I do not find any reason to disagree with the findings of the said report. 7. In view of the above discussions and findings, I am of the considered view that there is no infirmity in the impugned Order-in-Original No. 406/2022-23/JC/Gr.I 1A/NC-I/CAC/JNCH, dated 29-7-2022 passed by the OA and hence I uphold the same and reject the appeal filed by the appellant M/s. G.L. Khanna Sons as I find it devoid of any merit. We find that the authorities below did not examine the various parameters for determination of the issue of classifying the imported goods as off-specification furnace oil/waste oil or hazardous waste in a systematic and detailed manner. Rather they simply went by the wordings mentioned in the test reports, without referring to the specific factors. The test report of CRCL dated 6-6-2022 for these 12 samples state as below : RCL/AZU/DRI/253 to 264 do not meet the requirement in respect of the acceptable limit of Density at 15/15 c as prescr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 18-7-2017, an opportunity for a second test in case the first test result of a sample taken upon arrival of goods declared for importation shows an adverse finding, should be given by the Customs authorities. CBI C had also provided that in such cases, the importer or his agent who intends to request the Additional/Joint Commissioner for a re-test, then he shall submit a request for re-testing in writing to the said officer within a period of ten days from the receipt of the communication of the test results of the first test. Further, such CBI C circular also provide that the Customs officers may take a reasoned view in case the importer or his authorised agent/representative Customs Broker is unable to do so for reasons beyond his control. 8.3 It is on record that the test results have been sent by CRCL vide its letter dated 6-6-2022 addressed to SIO, DRI, Pune Regional Unit, Pune who received it later and after finding that the imported goods are not diesel oil, had informed the jurisdictional Customs authorities for taking further action as per law for clearance of the imported goods. Such communication was sent by DRI vide its letter F. No. DRI/MZU/PURU/GKLS/169/2022, date ..... X X X X Extracts X X X X X X X X Extracts X X X X
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