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2024 (3) TMI 137 - CESTAT BANGALOREClassification of goods - Importer declared the Goods as ‘Brush Cutters’ - classifiable under CTH 8467 8990 and not under CTH 8432 2990 as claimed in the respective Bill of Entry - Whether the extended period of limitation can be invoked for demanding duty pertaining to past clearance of the imported ‘brush cutters’ for the period 18.11.2009 to 28.11.2013 - penalty - with proposal for confiscation - HELD THAT:- On a plain reading of the relevant Tariff Entry and said explanatory notes under CTH 8432/8433 and 8467, it is clear that the products mentioned under CTH 8432/8433 are referring to ‘machineries’; ‘hand tools’ fall outside the scope of said entries; whereas hand tools explained in the explanatory note under CTH 8467 at sr. no 18 & 19 includes ‘brush cutters’, hence the product in dispute would fall under CTH 8467. The use of the product for Agricultural purpose cannot be the criterion for determination of the appropriate classification. It is held by the Hon’ble Supreme Court in the case of M/s O.K. Play (India) Ltd vs CCE [2005 (2) TMI 114 - SUPREME COURT] that use of an article as ‘Toys’ by children would not place in classification under ‘Toys’. It has been held in a series of cases that the explanations for classification of particular product mentioned in the HSN cannot be brushed aside in determining the correct classification of a product. Thus, the impugned goods in question i.e. ‘brush cutters’ is correctly classifiable under CTH 8467 8990 of CTA,1975. Past clearance of the imported goods - We find that the appellant declared the description of the goods correctly all along during the said period. Also, the goods were examined and assessed by the Department. Once the catalogue has been submitted by the appellant during the course of assessment, therefore, it is the responsibility of the Department to ascertain from the catalogue and description its classification under the appropriate heading. Also, it has been held in a series of cases that merely because the goods are not classified correctly under the appropriate heading by an assessee even though all facts are disclosed to the Department, the allegation of misdeclaration or suppression of fact cannot be invoked for recovery of duty for the past period. In our view, it is not necessary for the appellant to disclose on the relevant bills of entry that the goods are meant to be used as portable hand tools; the basis of classification as per explanatory notes of HSN. The stray cases of classification of the imported goods in five bills of entry under CTH 84678900 by the appellant, in our view, cannot lead to the conclusion that in other bills of entry, the goods were declared under wrong heading knowingly and to suppress the correct classification. The explanation furnished by the appellant that the mistake occurred when other goods of the same heading were imported along with the Brush cutters seems to be reasonable. Thus, invoking of extended period cannot be sustained and hence the demand is barred by limitation. Consequently, the penalties on the Appellants not sustainable. In the result, the impugned Order is modified to the extent of confirming classification of the impugned goods under CTH 84678990; confirming the demand and interest for the normal period and setting aside demand and interest for the extended period; also the penalty imposed on the Appellants is set aside. Appeals are disposed off accordingly.
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