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TMI Blog2024 (8) TMI 1351X X X X Extracts X X X X X X X X Extracts X X X X ..... rters and the EXIM trade that the said laboratory cannot analyse/test certain 20 specified goods due to non-availability of facility in that laboratory - on perusal of the test report given by CRCL, JNCH laboratory, it transpires that it is given mainly on the basis of visual examination and the nature of constituent material could not be ascertained by them. Hence, such test reports of CRCL, JNCH laboratory cannot be relied upon as it does not have any legal basis. It is seen that the BIS standard in IS 14534:1998 inter alia prescribe only post-consumer waste, in-house scrap for the purpose of monitoring the quality and for facilitating identification of the basic raw material. In such context, there is a mention of visible contamination with respect to post-consumer plastics which have been elaborated in Annexure-A to such Standard, as goods covering trash/carry bags, Carry bags, non-food containers, office supplies, municipal supplies, building products, pipe and fittings of PP, PE, nylon etc., Thus, it is clear that in terms of BIS standard, the imported product do not quality as plastic waste/scrap. The impugned order upholding confiscation of goods on the basis of violation o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ual appearance and physical properties indicated the material is regrind Visual appearance and physical properties indicated the material is regrind Visual appearance and physical properties indicated the material is regrind Single Thermoplastic/Not Single Thermoplastic Single Thermoplastic Single Thermoplastic Specific Gravity More than 0.940 More than 0.940 More than 0.940 Whether the results for above tested parameters within limits as per Hazardous Waste Rules, 2016 Yes Yes Yes 2.2 During examination by JNCH Customs Docks officers, as they found that the imported goods appeared to be of plastic waste, they referred the matter for further investigation by Special Intelligence Investigation Branch (SIIB) -Imports, for further investigation. SIIB of JNCH-Imports undertook further investigation of the imported goods pertaining to the said three B/Es imported by the appellants under panchanama proceedings dated 22.01.2021, 23.01.2021, 25.01.2021 and 27.01.2021. During such examination by SIIB of JNCH-Imports, in respect of imported goods covered under B/E No. 2320232 dated 12.01.2021 and 2302559 dated 08.01.2021,it was found that there were small flakes of dirty and oily used plasti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NCH customs and sent the same for retesting by Central Institute of Petrochemicals Engineering Technology (CIPET), Aurangabad which is premier national institution under Dept. of Chemicals Petrochemicals, Ministry of Chemicals Fertilizers, Govt. of India. Upon testing the samples, CIPET, Aurangabad vide test report dated 19.04.2021 stated that sample material is found to be HDPE regrind ; further, they informed that there was no methodology/standard available to clarify the waste material. Again when the matter was taken up by JNCH customs with CIPET vide letter 04.06.2021 it was replied by the CIPET, Aurangabad that no methodology / standard available to clarify the waste material . 2.4 Therefore, the JNCH customs interpreted that the CIPET re-test report sought on specific request by the importer has not categorically ruled out that the imported goods is to be waste, pairings and scrap of plastics and that on visual appearance, said imported goods appeared to be dirty, oily and of post-consumer plastics. Thus, JNCH customs concluded that the imported goods fall under the category of plastic waste/scrap and are restricted for import, unless import authorization (license) was grant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned Commissioner (Appeals) in the impugned order on the basis CRCL test report is not legally sustainable, as it is stated in the Public Notice No.96/2019-JNCH dated 23.10.2019 issued to the trade, that the said CRCL laboratory at JNCH do not have the facility for testing of co-polymers and reprocessed/recycled plastics falling under chapter 39. Hence, he submitted that the impugned order in upholding the original order for reclassification of the goods, confiscation of imported goods, imposition of redemption fine on such goods and penalties on the appellants, is not legally sustainable. 3.3 Further, learned Advocate further submitted that in identical matter, the Coordinate Bench of this Tribunal in the case of Commissioner of Customs Ahmedabad Vs. Surya Exim Limited 2015 (323)E.L.T.585 (Tri.- Ahmd.), have held that regrind granules cannot be considered as waste scrap for which DGFT restriction in Public Notice No.392 (PN)/1992-1997 dated 01.01.1997 apply. Hence, he submitted that the impugned order is liable to be set aside on the basis of the above order of the Tribunal. 3.4 Learned Advocate also relied upon the following case laws in support of their case: (i) Ideal Sheet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he importer does not have full information/particulars of the imported goods, he can seek for prior examination and the proper officer of customs may permit him to examine the goods in the presence of the customs officer. Hence, it is not clear when such permission for prior examination was permitted by the departmental authorities, how mis-declaration can be proposed on the appellants importer under Section 111(m) ibid and for its confirmation in the original order and the same was upheld in the impugned order. Thus, such confirmation in the impugned order dated 17.05.2022 is not proper and justified. 8.1 On perusal of the case records and the impugned order along with original order, it transpires that the imported goods have been tested by three laboratories viz., (i) CRCL JNCH laboratory, which is also known as DYCC, JNCH laboratory, is an in-house customs testing facility; (ii) Government laboratory of CIPET, Aurangabad, and (iii) Envirocare Labs Pvt. Limited, which is a NABL accredited laboratory. As regards CRCL JNCH laboratory, we find that the Commissioner of Customs, NS-V, JNCH had issued Public Notice No.56/2021 dated 16.06.2021 informing the importers, exporters and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther, we also find that upon specific query from JNCH customs authorities, when the matter was again taken up by them on 04.06.2021,the laboratory of CIPET, Aurangabad had categorically replied that there was no methodology or standard available to clarify that the tested material is the waste material. 8.4 The above test reports of two recognized laboratories clearly provide that the imported goods, are HDPE Regrind which is composed of single thermoplastic material. These reports also categorically state that the imported goods are not waste, inasmuch as the same having been tested for prescribed parameters proved to be within limits as per Hazardous Waste Rules, 2016. The imported goods being in different colour and in irregular shapes and size, being soaked in oil do not per se categorize it as plastic waste and scrap. In this regard, it is seen that the BIS standard in IS 14534:1998 inter alia prescribe only post-consumer waste, in-house scrap for the purpose of monitoring the quality and for facilitating identification of the basic raw material. In such context, there is a mention of visible contamination with respect to post-consumer plastics which have been elaborated in An ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing 3915 does not apply to waste, parings and scrap of a single thermoplastic material, transformed into primary forms ( headings 3901 to 3914 ). It is seen that the test results specifically provide that the imported goods are HDPE Regrind and these are composed of single thermoplastic material. Inasmuch as the primary forms under heading 3901 to 3914 include blocks of irregular shapes and different forms, in terms of Chapter note 6 and that waste/scrap of single thermoplastic material does not gets covered under heading 3915 in terms of Chapter note 7, the correct classification of the imported goods shall be under CTH 3901 and not under CTH 3915. Further, since the imported goods conform to the requirement of description of the tariff entry Polyethylene having a specific gravity of 0.94 or more , the imported goods are correctly classifiable under CTI 3901 2000. 9.3 It is also found that the impugned order have recorded that on the basis of the test reports and internal communication between the JNCH Customs authorities with Directorate General of Valuation, they had decided that in respect of single thermoplastic material, it has to be classified in CTH 3901 to 3914 and not und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o not fit in the description/definition of the plastic waste/scrap given in the said notification and hence, ordinarily not permissible for import. Thus, the impugned order upholding confiscation of goods on the basis of violation of DGFT s Public Notice requiring an import license in respect of the imported goods, is not proper and justified. 9.4 Further, on careful examination of the facts as recorded in paragraph 21.3 of the original order, provide that out of the total 1866 bags of HDPE regrind, it is only 27 small gunny bags and 2 jumbo gunny bags were found to contain with small flakes of plastic which were found to be sticky and had traces of oil on them, during the examination conducted by SIIB of JNCH - Imports under the panchanama proceedings. Thus, even on factual basis, the conclusion arrived at by the authorities below, that the entire imported goods having been violative of the import restrictions is not proper and is contrary to the facts as evidenced herein above. 10. We further find that the Co-ordinate Bench of the Tribunal, in the case of Suriya Exim Limited (supra) have held that regenerated granules made from single thermoplastic material known as Regrind granu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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