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TMI Blog2024 (9) TMI 332X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent by classifying the goods under CTH 5407 along with redemption fine of Rs.5,00,000/-, Customs Duty of Rs. 45,34,595 and equal amount of penalty was also imposed under Section 114A of the Customs Act, 1962. Aggrieved from the said order, the Appellant is before us. 3. The appellant has challenged the impugned order wherein the classification adopted by them has been re-classified by the Revenue under CTH 5407 of the Customs Tariff Act. He draws our attention to the following extracts of the OIO:- 2. Based on the above intelligence, the above live consignment was put on hold and examined by officers of Customs in presence of officers of DRI, Kolkata under Panchanama on 24.1.2017 and it was found that there were 370 bales in the consignment imported under Bill of Entry No. 8165070 dated 12.01.2017 Each such bale was found to contain 60 pieces of identical printed textile material (fabrics) which were folded and then stitched on two sides with being the remaining side opened. The stitching on the two sides appear to temporary in nature and uneven which is removable by easy means like pulling. The printed textile materials appear to be made of polyester. After unstitching a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his item viz. bed sheets and bed covers from China and selling the same in Kolkata. The Instant consignment was his 9th consignment of similar items imported from China. (ii) he admitted that the items imported by him declaring as Bed/ Mattress coversare not made up according to the criteria of made up given by Note 7 to Section XI of HSN. However, these items are used as bed sheet/ bed cover/mattress cover. (iii) he sold it to the wholesalers as well as the retailers who used to cut each such sheet into 2 pieces and after stitching sale it to the ultimate users. To save costing they used to import these items in this manner (iv) the items bed covers/ mattress covers which they imported are of cheap quality and used by poor class customers (v) he agreed to the opinion of the report bearing No. 0153031617 9316 dated 18.03.2017 of Textiles Committee Laboratory, Mumbai. 11. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx. Chapter 5407 of the Customs Tariff deals with "Woven fabrics of synthetic- filament yarn, including woven fabrics obtained from materials of heading 5404" and Chapter 5512 to chapter 5516 of the Customs Tariff deals with "Woven fabrics of Synthetic Staple Fibre". In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er received by the importers which has been stitched from two or three sides and one side folder and then these stitches were found to be loosely done on two sides lengthwise making it resemble as quilt cover. In these cases, the Department also raised the issue of valuation and other matters. The Tribunal has held that they should be treated as quilt covers only and not as fabric and allowed all the Appeals. Accordingly, he relies on the Final Order number 75827- 75840/2024 dated 30/04/2024. 6. He submits that this issue also had come up before this Bench wherein Department had filed an Appeal against Shilpha Finevest Pvt. Ltd. in Customs Appeal No. 75811 of 2018. The Tribunal held as under : 2. The facts of the case are that the respondent imported one consignment of "Bed sheet", declared as made of "100% Polyester" vide Bill-of-Entry No. 9383329 dated 20.04.2017 with the quantity as 22,100 pieces. 6.1 In the Bill-of-Entry, the respondent has described the goods as "Bed sheet (100% Polyester)" and that too in numbers. Chapter 63 deals with the following goods: - "Other made up textile articles; sets; worn clothing and worn textile articles; rags" while Chapter Heading 63 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... feet approximately. Admittedly, the end portion is neither hemmed nor stitched but the size and look of the material would clarify that these are meant to be sold in the market as bed sheet only. The same point has been reiterated by the proprietor of the firm when he was questioned by the Department officials. 10. On the other hand, if we go through the Test Report given by the Mumbai Textile Committee, in the OIO, the Adjudicating Authority himself has recorded that the Report is inconclusive. As can be seen from the above paragraphs, it is clear that the Mumbai Textiles Committee failed to provide the eight digit CTH. The Adjudicating Authority relied on the second Test Report of AITRA. But as per the details brought out in the OIO, we find that even this Report is not conclusive in its findings. In fact, it states that wefts are getting broken and weft yarns used in making the fabric cannot be determined. The Report says that the fabric contains 100% polyester but they are not even denying the fact that this cannot be a made-up bed sheet product. Overall, both the Test Reports are not conclusive and they do not give any definitive idea that the imported goods will fall under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal. Accordingly, the appeal filed by the Department is rejected. Since by usage, the goods have the contours of bedsheet, we take the view that Note 7 (b) of Section XI would be applicable. 13. On going through the case file of C & F. INC which has been decided by this Bench, we find that several factors are common. In that case also, the fabric was loosely stitched which could be pulled out to make two quilts, and the imported item was claimed to be quilt covers. In that case, further additional allegations were made on account of valuation issues. The relevant portion of the OIO in their case is reproduced below: 25. The classification of the goods has been claimed under CTH 63041990. On examination of the samples, drawn from the consignment and forwarded by the Dock officers, it is seen that the samples consist of a folded polyster sheet of fabric of size 235CMx 230 CM. The two sides of the folded sheet have been temporarily stitched i.e. with long stitch intended to be removed. It appears from the sample as if the fabric has been temporarily stitched to give it a look of a cover and it has been stitched in such a manner that stitch can be removed easily without any diffic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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