2002(09)LCX0205

IN THE CEGAT, COURT NO. IV, NEW DELHI

S/Shri G.R. Sharma, Member (T) and P.S. Bajaj, Member (J)

VARDHMAN ACRYLICS LTD.

Versus

COMMISSIONER OF CUSTOMS, MUMBAI

Final Order No. 217/2002-D, dated 4-9-2002 in Appeal No. C/380/2001-D

CASE CITED

Trijama Filterall Pvt. Ltd. v. Collector — 1992(07)LCX0044 Eq 1992 (062) ELT 0566 (Tribunal) — Distinguished [Para 9]

Advocated By :   Shri Balbir Singh, Advocate, for the Appellant.

Shri Atul Dikshit, SDR, for the Respondent.

[Order per : G.R. Sharma, Member (T)]. - In the impugned order the ld. Commissioner (Appeals) held :

“I have carefully gone through the records of the case and considered submissions made by the appellants. I find that it is not in dispute that what has been imported is 100% cotton cloth bleached plain weave. During the course of personal hearing, I had also seen the sample and I agree with the findings of the lower authority that the impugned goods being made of cotton and these are 100% cotton fabrics, bleached correctly classifiable under Heading 52.08. I also observe from the findings of the lower authority that the goods are in running length and are not even cut to any specific size and shape. I, accordingly, have no hesitation to hold that the impugned goods would fall under Exim Code 5208. I also observe that the lower authority has correctly held that by virtue of Note 7 to Chapter 59, the subject goods are excluded from the classification under Heading 59.11 of Customs Tariff firstly, because these goods are specifically falling under Heading 5208 of Section XI, and secondly, because these are in running length and not in the form cut to length or simply cut to rectangular shape. In consideration of above, I do not find any reason to interfere with the order of the lower authority. Accordingly, I find no merit in the appeal. The appeal is, therefore, rejected.”

2. The facts of the case briefly stated are that the appellants imported certain goods describing them in the Bill of Entry as 100% cotton cloth bleached and claimed customs classification under Chapter Heading 5208.20. In the invoice also the description of the goods was given as 100% cotton cloth bleached plain weave type S-618 (Calico) and 2023BL (Rough). The authorities below classified the goods under Chapter Heading 5208.00 and since the goods required a licence, they were confiscated and allowed to be redeemed on payment of fine to Rs. one lakh in addition the penalty of Rs. 25,000/- was also imposed.

The appellants wanted classification of the goods under Chapter Heading 59.11 and stated that no licence was required.

3. Arguing the case for the appellant Shri Balbir Singh, ld. Counsel submits that the appellants imported the goods declared them 100% cotton bleached plain weave fabrics and claiming classification thereof under Chapter sub-heading 5911.90. He submits that the goods under import were specifically manufactured for use in filtration of polymer. He submits that this was a specific product for a specific use. He submits that the product was examined by experts who also held that it was a specific product meant for filtration of polymer and was not ordinary cotton cloth. Ld. Counsel submits that Note 8 of Section 11 provides (a) Chapters 50 to 55 and 60 and, except where the context otherwise requires Chapters 56 to 59 do not apply to goods made-up within the meaning of Note 7 above and that after Chapters 50 to 55 and 60 do not apply to goods of Chapters 56 to 59 and 60 do not apply to goods of Chapters 56 to 59. He submits that in terms of this Section Note, the goods imported by them are not covered under Chapters 50 to 55 and 60. He submits that Note 7 of Chapter 59 under sub-para (iv) provides:

“Flat woven textile fabrics with multiple warp or weft, whether or not felted, impregnated or coated of a kind used in machinery or for other technical purposes”.

4. Ld. Counsel submits that the product imported by them was filter cloth and therefore, was correctly classifiable under Chapter Heading 59 of Customs Tariff. Ld. Counsel, therefore, submits that since the goods were specifically made to work as filter cloth for filtration of polymers, they were classifiable under Chapter sub-heading 5911.90 and did not require a specific licence. He, therefore, prayed that the appeal may be allowed.

5. Shri Atul Dikshit, ld. DR submits that the Bill of Entry and the invoice indicated that the goods imported by the appellant were 100% cotton cloth bleached plain weave. Therefore, it was classifiable under Chapter Heading 52.08. He submits that the contention of the appellant that the cloth was of a specific need and was actually filter cloth and was excluded from being classified under Chapter 52 and was classifiable under Chapter sub-heading 5911.90 is not tenable. He submits that this contention of the appellant is not correct inasmuch as at the time of clearance of the imported goods, the goods were 100% cotton cloth in running length. They were neither given any specific shape, form or made-up article to be classifiable under Chapter sub-heading 5911.90. Ld. DR, therefore, submits that the authorities below have rightly classified the goods under Chapter heading 52.08. Ld. DR submitted that the appellant has also referred to expert opinion. He submits that these expert opinions were not relevant to the present issue inasmuch as at the time of clearance of the goods, there was no indication that the goods were of specific construction or made-up so as to be eligible for classification under Chapter sub-heading 5911.90.

6. Ld. DR reiterating the findings of the authorities below submits that the goods are correctly classifiable under Chapter sub-heading 52.08. He, therefore, prays that the appeal may be rejected.

7. We have heard the submissions of both sides. We note that in the instant case that the issue for determination is whether a specific licence was required to be obtained for import of these goods as the goods were classifiable under Chapter Heading 52.08 or no specific licence was necessary for import of the goods which were claimed to be classifiable under Chapter Heading 5911.90.

7. We note that for clearance of the goods, the appellants produced the Bill of Entry and a copy of the invoice. The description of the goods in both the documents was 100% cotton cloth. The cotton cloth was in running length. There was no indication that it was cut to size or was in the form of made-up so as to qualify for classification under Chapter sub-heading 5911.90.

8. We have seen the expert opinion. The expert opinion only indicate that the cloth could be used as a filter. However, use of the cloth is not determinant for classification of the product. The product is normally classified in the form it is presented for clearance. In the instant case at the time of clearance of these imported goods, the goods were 100% cotton cloth in running length and therefore, they have been rightly classified under Chapter Heading 52.08.

9. We have also perused the judgment of this Tribunal in the case of Trijama Filterall Pvt. Ltd. v. CC reported in 1992 (062) ELT 566. In this case, the goods were described as filter aid and non-woven filter panels and since the goods were given specific shape and made in that case which is not the case before us, therefore, the issue is distinguishable and the ratio of the judgment in the case relied upon by the appellant is not at all applicable to the facts of the present case.

10. Having regard to the above discussions and findings, we hold that the goods needed a specific licence. In this view of the matter, we do not see any reason to interfere with the impugned order. The impugned order is, therefore, upheld and the appeal is rejected.

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Equivalent 2002 (146) ELT 604 (Tri. - Del.)

Equivalent 2002 (053) RLT 0273