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TMI Blog2025 (3) TMI 69X X X X Extracts X X X X X X X X Extracts X X X X ..... essment of such goods, the imported consignments were subjected to examination on First Check basis and representative samples were taken for testing by the Textile Committee Laboratory. On the basis of the test reports received from the Textile Committee reporting that the imported goods are fabrics made of Non- texturized Polyester Yarn, the goods were assessed by the department under CTI 5407 6190 charging the Basic Customs Duty (BCD) at the rate of 25% ad valorem in terms of Serial No.51 of Notification No.36/2003-Customs and applicable Counter Vailing Duty (CVD). The appellants-importer had paid the duty as assessed by the customs authorities and the imported goods were cleared out of Customs control. 2.2 Subsequent to such clearance, Directorate of Revenue Intelligence (DRI), Mumbai Zonal Unit had gathered certain intelligence which indicated that some persons are importing polyester fabrics which attract higher BCD, by mis-declaring its technical characteristics so as to show that these are Non-texturized Polyester yarn which attract lower BCD, thereby attempting to evade customs duty. On the above basis, DRI had taken up the remnant samples of the imported goods in the abo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te customs duty, the imported goods were cleared from Customs control. 3.2 Learned Advocate further submitted that subsequent to such clearance of imported goods, on the basis of re-testing undertaken with CRCL laboratory at New Custom House, the imported goods were being re- classified for demand of higher duty, wherein the appellants-importer were not even furnished with such re-test report results. Hence, he stated that the department's views on classification of imported goods are not duly supported by any evidence/document and they had not been given an opportunity to defend their case properly. Hence, he pleaded that the impugned order is not legally sustainable. 3.3 In addition to the above, learned Advocate stated that such disputed issues were already addressed by the Tribunal and it was held that such demands are not sustainable. In support of their stand, learned Advocate had relied upon following decisions of the Tribunal in the respective cases mentioned below: (i) Shri Lakshmi Cotsyn Limited Vs. Commissioner of Customs & C.Ex. Kanpur - 2011 (263) E.L.T. 299 (Tri. - Del.) (ii) Commissioner of Customs, Mumbai Vs. Atlas Mercantile Pvt. Ltd. -2019 (366) E.L.T. 911 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by some other person. Further, it is also disputed by the department that the basic evidence of re-test report was not provided to the appellants-importer, except its extract is mentioned in the Less-Charge-Demand Notice dated 23.12.2003. From these factual details, we find that the essential requirements of legal provisions of Section 28 of the Customs Act, 1962 such as service of notice of the basis on which the appellants-importer is being asked to pay the differential duty, reasonable opportunity to be given for enabling them to present their representation for due consideration before passing of the order, have not been carried out by the authorities below. This is evident from the fact that the original order does not even provide the re-test report; but it has gone in detail about the visit of Joint Director of CRCL to the Textiles Committee Laboratory to state that they did not follow the standard testing requirements, to doubt the test report given by them earlier in confirmation of the imported goods as Non-texturized polyester yarn. Therefore, we are of the considered view that the confirmation of the duty demand under Section 28 ibid does not stand the scrutiny of law. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k or a very high extensibility. The high elasticity of both types makes them especially suitable for use in the manufacture of stretch garments (e.g. tights, hose, underwear) while the high bulk yarns give fabrics softness and warmth of touch. Textured yarns may be distinguished from non-textured (flat) filament yarns by the presence of special twist characteristics, small loops or reduced parallel orientation of the filaments in the yarn." 6.2 From a close reading of the same, it is noticed that the said notes contain distinguishing features between textured yarn or non-textured yarn. We do not agree with the contentions of the learned Jt. CDR that the said notes prescribed any method for testing the samples for determining whether the yarn is textured or not. ..... 8.1 The Textile Committee is undisputedly a specialised agency. CRCL is like a general physician and that Textile Committee is like a kind of specialist on matters relating to textile and textile articles. That is why, in our considered opinion, the DGFT prescribed Textile Committee as the nominated agency for testing of textile and textile article for the presence of hazardous chemicals. Under these circumstan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... doubt naturally has to be given to the assessee especially when the test is clarified to be subjective. The decisions relied upon by the learned Jt. CDR that the test report of chemical examiner cannot be brushed aside is valid. However, in the present case, confronted with other favourable reports which were also obtained at the instance of the Department, the choice has to be made between one of the said report and the CRCL report. The test reports were on question of facts and the test reports were said to be subjective in nature, Naturally, the assessee should be extended the benefit of doubt." 8.3 We further find that in an identical matter that came up before the Co- ordinate Bench of the Tribunal in the case of Smart Designer (supra), it was held that such report of re-testing by CRCL laboratory as opposed to Textiles Committee report is not acceptable, and the resultant re-classification of goods with consequential denial of benefit of notification is not proper in law. The relevant paragraph in the order passed by the Tribunal is extracted and given below: "6. Appellant had, as we find, claimed classification as fabric containing 85% or more by weight of textured polye ..... X X X X Extracts X X X X X X X X Extracts X X X X
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