2009(08)LCX0296

IN THE CESTAT, SOUTH ZONAL BENCH, CHENNAI

Ms. Jyoti Balasundaram, Vice-President and Dr. Chittaranjan Satapathy, Member (T)

Tamil Nadu Newsprint & Papers Ltd.

Versus

Commissioner of Customs, Tuticorin

Final Order Nos. 1181-1184/2009, dated 31-8-2009 in Appeal Nos. C/370 and 372-374/2003

Advocated By -

Shri R.R. Padmanabhan, Consultant, for the Appellant
Ms. Indira Sisupal, JDR for the Respondent.

[Order per: Chittaranjan Satapathy, Member (T)]. -

In these four appeals the common issue is whether the impugned goods imported by the appellants can be classified under heading 2701.19 and charged to 15% duty as contended by the appellants or should be classified under heading 2701.12 and charged to 25% duty as contended by the Department.


2. We have heard both sides. Shri R.R. Padmanabhan, Ld. Consultant appearing for the appellants states that the appellants have been importing 'non coking coal' in the past which was being classified under heading 2701.19 all along without the Department disputing the same. The present consignments are also of the same variety as evident from the invoices and purchase orders and the appellants have correctly claimed classification under the heading 2710.19. He further states that the survey was carried out for determining the price to be paid to the supplier-as the same was dependent on the gross calorific value determined on air dried basis. He states that the impugned goods have been categorized as "Bituminous Coal" by the Department relying on the survey report, without doing any independent test. He draws our attention to the chapter note which provides a calorific value limit (on a moist mineral matter free basis) which is required to be equal to or greater than 5833 Kcal/Kg. for classifying coal as bituminous coal under heading 2701.12. He states that the report of survey undertaken for valuation purpose cannot be used for classification purpose as the criteria are different, in one case it is on air dried basis and the other one is on a moist mineral matter free basis.


3. Heard Ld. JDR, Ms. Indira Sisupal. She supports the impugned orders passed by the authorities below based on SGS survey report.


4. After hearing submissions from both sides and perusal of case records, we find that according to the purchase orders, invoices and the declaration by the appellants, the impugned goods under import are 'non coking coal'. The survey has been done at the instance of the importers to enable them to determine the amount payable to the supplier. The survey has determined the gross calorific value on air dried basis since the payment terms were dependent on such value. If the Department had a doubt about the description of the impugned goods and the classification of the same, they should have carried out a chemical test. Without such a chemical test, the Department has no basis to classify the impugned goods under heading 2701.12 and charge the same to higher rate of duty. On the other hand, the appellants have a strong case on classification of the impugned goods under heading 2701.19 on the basis of past imports, the invoices as well as purchase orders. Hence, we set aside the impugned orders and allow the appeals.


6. As far as the Appeal No. C/374/03 is concerned, it deals with another issue relating to availment of DEPB benefit. Shri R.R. Padmanabhan, Ld. Consultant appearing for the appellants states that the appellants are not pressing their appeal regarding this issue and hence as far as the impugned order relates to this issue, the same is upheld and the appeal in this regard is dismissed as not pressed.


7. In view of the above, Appeals No. C/370/03, No. C/372/03, and No. C/373/03 are allowed and Appeal No. C/374/03 is partly allowed.

(Operative part of the Order pronounced in the open Court on 31-8-2009)

Equivalent 2010 (253) ELT 0153 (Tri. - Chennai)