2013(02)LCX0060

IN THE CESTAT, PRINCIPAL BENCH, NEW DELHI [COURT NO. II]

S/Shri D.N. Panda, Member (J) and Manmohan Singh, Member (T)

K.M. Udyog

Versus

Commissioner of Customs (Prev.), Amritsar

Final Order No. 55698(PB), dated 22-2-2013 in Appeal No. C/592/2008

Advocated By -

Shri Sudhir Malhotra, Advocate, for the Appellant.
Shri N. Pathak, DR,for the Respondent.

[Order per : D.N. Panda, Member (J)]. -

Learned Counsel on the ground of classification and valuation of the goods described in the invoice at page 13 of appeal folder submits that the goods imported were re-rollable plates and that shall be classifiable under Tariff Entry No. 7208.9000. When the department made a thorough checking of the goods with technical expert report available at page 20 of appeal folder they were of the view that the goods shall be classifiable under Tariff Entry 7208 40 10. According to learned Counsel that is not proper classification and order of the learned Commissioner (Appeals) is unsustainable mis-clarification and wrong valuation resulted in imposition of redemption fine of Rs. 4 lakhs and penalty of Rs. 25,000/-.


2. Relying on the Tariff Entry 7208.9000, learned Counsel submits that the goods imported are H.R. plates and does not require any thickness to be proved since those were not original H.R. plates. The goods were re-rollable in character. Such characteristics shall not bring the goods imported to the ambit of Tariff Entry 7201.4010. Once the goods do not fall under the said tariff entry it shall not be subjected to over valuation by the department. Accordingly, there were no warranting circumstances for imposition of redemption fine or penalty.


3. Learned DR on the other hand, says that description of goods imported was mis-declared, so also the valuation was depressed. When the goods were examined, it was found to be serviceable H.R. plates and those were bound to be classified under Tariff Entry 7208.4010. The imported goods being classifiable under the said entry, the valuation of Rs. 28/- per kg. adopted in adjudication remained undisputed. It was also submitted by learned D.R. that the appellant had no grievance before any other authority against Chartered Engineer's report as to the character of the goods for which assessable value was rightly enhanced. Therefore, adjudication should not be interfered.


4. We have heard both sides extensively since matter of classification is anxiety to both sides and having far reaching consequences. Main heading in which imported goods shall fall in Tariff Heading 7208 which reads as under :-

"7208 "Flat-rolled products of iron or non-alloy, of a width of 600 mm or more, hot-rolled, not clad, plated or coated" Legislature considered that several types of goods which are basically plates, with different shapes fall in the same family. Their sub-classification was prescribed without impairing the main characteristics and nature of the goods. Main Heading 7208 categorically deals with plates because of size given in the tariff entry. In various classifications like 7208.2510 legislature dealt plates only and similarly in the sub-heading 7208.2610, 7208.2710, 7208.3610, 7208.3710, 7208.3810, 7208.3910, 7208.5110, 7208.5310, & 7208.5410. Such a sub-classification clearly leads to the conclusion that legislature intended plates of different thickness should only belong to the family of 7208 tariff entry. Even considering the appellant's submission that the goods imported may fall under tariff entry 7208.9000 that is plate only. Therefore, plate being serviceable goods only its re-rolling character is ruled out.


5. There is no scope to dis-agree with the observation of Chartered Engineer available at page 20 of appeal folder who has categorically remarked that 90% of the goods imported were serviceable material and recoverable from the plates imported by appellant. Balance material of 10% was found to be re-rollable after cutting from the plates to make that servicable. We may state that it is unsafe to discard a technical report on the subject on the fiction of debatable/rivalry entry in the tariff. The appellant has not declared thickness or size of the goods in the bill of entry. Bill of Entry only says "re-rollable plates". Therefore, there cannot be any divergent view from the technical view relied by Revenue who has occasion to physically inspect the goods for his opinion.


6. For the reasons aforesaid there cannot be dispute on classification. The goods imported shall fall into Tariff Entry 7208.4010 for the percentage and character described in technical report.


7. Lastly appellant's submission is that redemption fine was harsh and penalty was unreasonable. We looked into quantum thereof. We find that arguments learned Counsel has force for reduction in redemption fine since percentage of the character of the goods has been mentioned in technical report which is 10% to be re-rollable. Keeping this aspect in view we direct that redemption fine be reduced to Rs. 2 lakhs (Rupees two lakhs only). So far as penalty is concerned, in view of classification issue involved, finding the declaration contrary to law and looking into modus operandi followed, penalty of Rs. 25,000/- is confirmed. Thus adjudication is confirmed except reduction in redemption fine as above.

(Dictated & pronounced in the Open Court)

Equivalent 2013 (292) ELT 0476 (Tri. - Del.)

Equivalent 2013 (198) ECR 0270 (Tri.-New Delhi)