TMI Blog2023 (5) TMI 450X X X X Extracts X X X X X X X X Extracts X X X X ..... entific knowledge, there is much to be said for authentic and authoritative source being employed in judicial decision-making but, nonetheless, the judicial organ erected by the Constitution would be in jeopardy if that proposition is accepted in absolute terms - We cannot subscribe to such a position as all judgements may, if not stemming from such expertise, be said to be lacking in credibility. That is clearly overreach on the part of Learned Authorized Representative. Reliance placed on the decision of the Tribunal in re Fortune Impex may not be assistance as there is no record of section 138B of Customs Act, 1962 having been brought to the notice of the Tribunal which followed the decision of the Hon ble High Court of Calcutta in TAPAN KUMAR BISWAS VERSUS UNION OF INDIA (UOI) AND ORS [ 1995 (7) TMI 429 - CALCUTTA HIGH COURT] and in DEBU SAHA VERSUS COLLECTOR OF CUSTOMS [ 1990 (2) TMI 184 - CEGAT, CALCUTTA] . In re Tapan Kumar Biswas, the issue was limited to the scope of section 124 of Customs Act, 1962 and in re Debu Saha, the issue pertained to crossexamination of co-noticee - In re Jagdish Shanker Trivedi, the Tribunal was not only considering statements recorded under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... horities that preference been accorded to the generality of fabric woven from synthetic filaments over the more specific composition of textured polyester filaments even though the reference to the testing authorities was ascertainment of the presence of texturised yarn in the impugned fabric. The declaration of goods as polyester fabric has not been controverted. Woven fabrics containing less than 85% by weight of textured polyester yarn and woven fabrics containing more than, as well as less than, 85% by weight of non-textured polyester yarn are covered with sub-heading 5407 61 of First Schedule to Customs Tariff Act, 1975; by no stretch can a later sub-heading be adopted for woven fabrics from polyester , except on composition less than 85%, without compromising the General Rules for the Interpretation of Import Tariff in Customs Tariff Act, 1975. In the absence of finding, or even proposal, that samples of impugned goods contained less than 85% by weight of polyester yarn, the sub-heading adopted for re-classification does not meet the test of decisions of the Hon ble Supreme Court in HPL CHEMICALS LTD. VERSUS CCE, CHANDIGARH [ 2006 (4) TMI 1 - SUPREME COURT] where it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tem 5407 6190 of First Schedule to Customs Tariff Act, 1975 claiming duty liability of 25% from notification no. 36/2003-Cus dated 1st March 2003 (at serial no. 51) in bills of entry filed in July and August 2003 which were cleared upon report of the Textile Committee on the representative samples drawn and sent to them. Subsequently, on report of 12th December 2003 and 19th December 2003 respectively of test carried out by Central Revenue Chemical Laboratory (CRCL), notice was issued to the importers before confirming differential duty of ₹ 29,64,186 and of ₹ 9,72,606 respectively to be recovered, under section 28 of Customs Act, 1962, along with applicable interest under section 28AB of Customs Act, 1962, from M/s Suri Exports (P) Ltd [ order-in-appeal no. 116/2009/MCH/ADC/Gr.III/2009 dated 6th May 2009 ] and M/s Janta Trading Co [ order-in-appeal no. 49/2010/MCH/AC/GR-III/2010 dated 25th February 2010 ] by charging rate of duty to that corresponding to tariff item 5407 7200 of First Schedule to Customs Tariff Act, 1975, for which notification no. 27/2003-Cus dated 1st March 2003 (at serial no. 93) was applicable, in order of 21st December 2006 and 29th March 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turned by Central Revenue Control Laboratory (CRCL) and of the other side insisting upon the inappropriateness of later testing that, in their contention, lacks validity. The proceedings before the lower authorities were disposed off on that solitary aspect even though, in the order of the Tribunal on the earlier occasion, such constrained disposition had not been directed; more so, as the Tribunal had merely taken note of the preliminary objection on non-adherence to principles of natural justice to issue directions at the threshold. 6. Between the submissions made by, and on behalf of, the jurisdictional Commissioner - as appellant in the matter of M/s Suri Exports (P) Ltd and as respondent in the appeal of M/s Janta Trading Co - and of the two importers - as respondent in appeal of Revenue and as appellant respectively - the arguments on the above aspect have been gone over repeatedly. Hence, rather than engage in the tedium of chronological narration, we propose to deal with the analysis of the issues warranting resolution. It suffices, for the nonce, to bear in mind that the goods impugned in both the disputes had been cleared initially on confirmatory report from the Texti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the tariff schedule instead of being fitted around the tariff schedule with law relegated to dismissible irrelevance. The malady needs, not palliative care but, putative cure lest the damage overwhelms the whole. 9. On behalf of the importers, Learned Counsel argued that clearances were effected on the finding of conformity of declaration of composition of the fabric as textured polyester yarn with tests of the Textile Committee and that it was the remit of the Textile Committee, in accord with practice prevailing then, to determine the type of yarn in the product which was, by later instruction of the following year, assigned to the Central Revenue Control Laboratory (CRCL). It was contended by him that the subsequent testing, with varying result, by the Central Revenue Control Laboratory (CRCL) lacked credibility on their own admission of absence of standards that were, only subsequently, crafted by certain experts and whose professional competence to do so was glossed over by steadfast refusal to permit their cross-examination. The manner in which it was held out that the samples tested subsequently were the same as the one drawn in the presence of representatives of imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting prompted Central Board of Excise Customs (CBEC) to direct, by circular no.23/2004-Cus dated 15th March 2004, that such consignments as were to be tested for 'azo dyes for which Directorate General of Foreign Trade (DGFT) had nominated Textiles Committee as the notified agency for the purpose of their notification supra would also be tested for composition there and only other consignments to be tested for composition would be exclusively referred to the inhouse laboratory of the respective customs formation. The controversy of contrary outcomes of test of the impugned consignments, initially reported by Textiles Committee as conforming to declaration but found by customs laboratory to be of different composition, being, thus, incongruent with the subsequent instructions, continued to plague disposal of the demand notices and as the controversy raged, a committee, comprising Joint Director, Central Revenue Chemical Laboratory (CRCL) and two others of Textile Committee constituted for the purpose, reported upon the methodology and modality of testing wherein it was admitted that no standard test was, otherwise, available for distinguishment of texturized and non-textur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atements subject to examination in section 138B only from September 1973. Hence, the decisions rendered without referring to this provision offer no assistance in the dispute before us. Per contra, reliance placed by Learned Counsel upon the decisions of the Hon ble High Court of Bombay in Kellog India Pvt Ltd v. Union of India [2007 (8) STR 84 (Bom)] and of the Hon ble High Court of Gujarat in Manek Chemicals Pvt Ltd v. Union of India [2016 (334) ELT 302 (Guj)], even though not referring to the incorporation in Customs Act, 1962, does, nonetheless, drive the point home that section 138B of Customs Act, 1962 cannot be overlooked. And, more particularly, in the context of the test undertaken subsequently. 13. It is common ground that no test method existed, as standard, for ascertainment of textured yarn in fabric and that a methodology had been devised by Joint Director, Central Revenue Control Laboratory (CRCL) along with two members of the Textile Committee. In these circumstances, cross-examination would appear to have been intended for placing on record the technical competence of the progenitors of the new testing parameters as expertise in one or, even several branches ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... man-made textile materials , by reliance on the test report. Surprisingly, the adjudicating authority had, not two but, three possible tariff items to choose from and that is in breach of the General Rules for the Interpretation of Import Tariff which permits alternative to claimed classification subject to compliance with stipulations therein. Accordingly, it was held by the Hon ble Supreme Court in HPL Chemicals Ltd v. Commissioner of Central Excise, Chandigarh [2006 (197) ELT 324 (SC)] that 29. This apart, classification of goods is a matter relating to chargeability and the burden of proof is squarely upon the Revenue. If the Department intends to classify the goods under a particular heading or sub- heading different from that claim by the assessee, the Department has to produce proper evidence and discharge the burden of proof. In the present case the said burden has not been discharged at all by the Revenue and in Hindustan Ferodo Ltd v. Commissioner of Central Excise, Bombay [(1997) 2 SCC 677] that It is not in dispute before us as it cannot be, that owners of establishing that the said drinks fell within Item No. 22 lay on the Revenue. Revenue has led no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al organic polymers and process of polymerisation or of dissolution/chemical treatment respectively. The scheme of the chapter, after enumerating yarns - synthetic and artificial - till heading 5406, moves on to woven fabric - from synthetic and from artificial - in the remaining two headings. Within the heading for woven fabric made from synthetic yarn, those obtained from high tenacity yarn of nylon or other polyamides or of polyesters , obtained from strip or the like , specified fabrics and other woven fabric make up the headings; the last is further segregated as those containing 85% of more by weight of filaments of nylon and other polyamides , containing 85% or more by weight of textured polyester filaments , containing 85% of more by weight of polyester filaments , containing 85% more by weight of synthetic filaments , containing less than 85% by weight of synthetic filaments, mixed mainly solely with cotton and other woven fabrics of which we need not concern ourselves with the last two as the dispute is about the two subheadings preceding these. It is thus clear that other woven fabrics are, by composition, distinguished according to the specificity of c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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