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TMI Blog2024 (10) TMI 579X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 digit heading of 8714 - the correct classification on six digit level of the imported goods is 8714 10. Within that six digit heading are two 8 digit CTI saddles and others. Since the imported goods are not saddles they fall under others. We have no manner of doubt that appropriate classification for the imported goods is 8714 10 90. Therefore, we hold in favour of the Revenue on the question of classification and uphold the classification of the imported goods in the impugned order. The Commissioner (Appeals) erred in holding that the parts of motorcycle or moped need to have the characteristics of the shock absorber for them to be classified under 8714 10 90. It goes without saying that no part in itself will have the essential character of the article until it becomes the part of the article. However, for that reason it does not cease to be a part of the article. A shock absorber, for instance, will be a shock absorber even if it is not fitted in the motorcycle. Similarly parts of shock absorber will be such parts even before they are assembled together as a shock absorber. The Commissioner (Appeals) clearly erred in holding that the parts have to assume the essential charact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gned order. Therefore, the penalty imposed on Shri Negi also needs to be set aside. Appeal disposed off. - DR. MS. RACHNA GUPTA, MEMBER (JUDICIAL) AND MR. P.V. SUBBA RAO, MEMBER (TECHNICAL) Shri N.K. Sharma, Advocate for the appellant. Shri S.K. Rahman, Authorized Representative for the Department ORDER The order-in-original dated 04.03.2020 passed by the Principal Commissioner of Customs (Preventive), New Delhi is assailed by M/s Showa India Pvt. Ltd. [Showa] in its appeal No. C/51881 of 2021. It is also assailed that Shri Manoj Negi, Manager (Commercial) of Showa in his appeal No. C/51046 of 2021. Showa is aggrieved by the rejection of its classification of the imported goods under Customs Tariff Item [CTI] 8714 91 00 and their re-classification under 8714 10 90 by the impugned order. It is also aggrieved by the consequential demand of duty under section 17(4) in respect of the Bill of Entry dated 27.08.2018 and demand in respect of the previous Bills of Entry filed within one year under section 28(1). It is also aggrieved by the order of confiscation of the goods under section 111(m) and imposition of redemption fine and penalty on it. Shri Negi is aggrieved by the imposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the shock absorbers imported by the appellant classifiable under CTI 8714 10 90 or under CTI 8714 91 00; (b) Will the appellant be entitled to the benefit of Notification No. 50/2017-CUS (Sl. No. 532) even if the parts are classified under CTI 8714 10 90; (c) Can the goods be confiscated under section 111(m) for claiming a wrong classification ; (d) Is the penalty imposed under section 112 on Showa sustainable ; and (e) Is the penalty imposed on Shri Negi under section 114AA sustainable. 8. Classification of the goods :- The relevant entries of the Customs Tariff are as follows :- 8714 PARTS AND ACCESSORIES OF VEHICLES OF HEADINGS 8711 TO 8713 8714 10 - Of motorcycles (including mopeds) : 8714 10 10 --- Saddles 8714 10 90 --- Other 8714 20 - Of carriages for disabled persons: 8714 20 10 --- Mechanically propelled 8714 20 20 --- Non-mechanically propelled 8714 20 90 --- Other - Other: 8714 91 00 -- Frames and forks, and parts thereof 8714 92 -- Wheel rims and spokes: 8714 92 10 --- Bicycle rims 8714 92 20 --- Bicycle spokes 8714 92 90 --- Other 8714 93 -- Hubs, other than coaster braking hubs and hub brakes, and free-wheel sprocket-wheels: 8714 93 10 --- Bicycle hubs 8714 93 20 --- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, case body, guise bush, piston ring rebound etc. are classified under CTH 8714 91 00 as Frames and forks, and parts thereof . I find force in the submission that these parts have not even assumed the essential character of a shock absorber, much less of a motorcycle or moped. These are not complete parts which can be directly integrated into motorcycles, scooters etc., rather these parts are used for the manufacture of shock absorbers. 5.5 I refer to case of Jtekt Sona Automotive India Ltd. [ 2020 (371) E.L.T. 293 (Tri. Del.)] wherein issue of classification of Gear reduction blank imported as part of Column Type Electric Powers Steering Systems (CEPS) for use in motor vehicles was decided and it was held that goods were not parts of motor vehicles under CTH 8708 but were gears etc. under CTH 848300. Similar was case of Varroc Engineering P. Ltd. [ 2019 (366) E.L.T. 170 (Tri. Mumbai)] wherein LCD imported for dash boards of motorcycles were not considered as parts of motor vehicles but as LCDs. 5.6 Accordingly, impugned goods have been correctly classified under 87149100 as parts of frames and forks (which covers shock absorbers) and they cannot be classified as parts of motor cy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he imported goods is 8714 10 90. Therefore, we hold in favour of the Revenue on the question of classification and uphold the classification of the imported goods in the impugned order. 15. In view of our findings we do not agree with the view taken by the Commissioner (Appeals) for the earlier period in his order dated 21.10.2021. In our view, the Commissioner (Appeals) erred in holding that the parts of motorcycle or moped need to have the characteristics of the shock absorber for them to be classified under 8714 10 90. It goes without saying that no part in itself will have the essential character of the article until it becomes the part of the article. However, for that reason it does not cease to be a part of the article. A shock absorber, for instance, will be a shock absorber even if it is not fitted in the motorcycle. Similarly parts of shock absorber will be such parts even before they are assembled together as a shock absorber. The Commissioner (Appeals) clearly erred in holding that the parts have to assume the essential character of the article. His reliance in the case laws of Jtekt Sona Automotive India Ltd. and Varroc Engineering P. Ltd. is completely misplaced. Thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. This would imply that the goods should be as per the declarations. It does not mean that the classification of the goods which is a matter of opinion of the importer self-assessing goods should match with the opinion of the officer who may re-assess the goods. Nothing in this section provides for confiscation of the goods if the classification of the goods by the importer during self-assessment does not confirm to the views of the proper officer or any adjudicating authority. Clearly goods cannot be confiscated under section 111(m), if the classification claimed by the appellant for the Bill of Entry does not confirm to the views which the officers may hold. Therefore, the order of confiscation needs to be set aside and consequently the redemption fine also needs to be set aside. 21. Penalty under section 112 upon the appellant: - Section 112 reads as follows :- SECTION 112. Penalty for improper importation of goods, etc. Any person, - (a) who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 111, or abets the doing or omission of such an act, or (b) who acquires possession of or is in any w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incorrect material. - If a person knowingly or intentionally makes, signs or uses, or causes to be made, signed or used, any declaration, statement or document which is false or incorrect in any material particular, in the transaction of any business for the purposes of this Act, shall be liable to a penalty not exceeding five times the value of goods. Nothing in the records shows that Shri Negi made any declaration or statement which is false or incorrect in the Bill of Entry. All that was done that was during self-assessment, they classified the goods under a particular CTI which is different from the CTI held in the impugned order. Therefore, the penalty imposed on Shri Negi also needs to be set aside. 24. In view of the above, we dispose of the appeals as follows :- (a) Appeal No. C/51881 of 2021 filed by M/s Showa India is partly allowed upholding the classification of the goods and confirmation of demand of duty along with interest, but setting aside the confiscation of the goods, imposition of redemption fine and penalty on M/s Showa India. (b) Appeal No. C/51046 of 2021 is allowed and the penalty imposed on Shri Negi is set aside. 25. Both appellants will be entitled to co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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