2011 (6) TMI 546 - CGOVT - Customs

Drawback - Revision Application - goods to be not fitting the description of Sandals but were found to be chappals - after examination the goods were found fitting in description of leather chappals at Sr. No. 640301A-4.7% and hence the shipment was allowed provisionally - case was adjudicated for entitlement of DBK S.No. 640313 @ 1% only Held that - applicable Drawback Schedule is an independent piece of legislation and other (provisions) of Customs Act 1962 including Customs Tariff can be of guiding factor role but cannot form the sole basis of deciding the impugned classification. Government therefore after taking into consideration the simple and plain reading of the applicable Drawback schedule along with the fact of basic constituent material (i.e. leather) categorization as per council of leather exports C.B.E. & C. Circular No. 08/2002-Cus. dated 30-1-2002 and facts of maximum coverage/contact areas etc. is of considered opinion that any (additional) re-enforcements attachment accessories and components should not form basis of altering the basically qualified classification of impugned export goods herein i.e Leather Sandals . there is no legal bar so as not to attach wooden heel to Ladies Leather sandals with leather neolite sole heels Government sets aside the impugned orders and allows the applicant s claimed Drawback under Drawback S.S. No. 640311A @ 7.5% (with relevant cap.). Revision Application thus succeeds

Summary

Issues: Classification of export goods for Drawback eligibility under the Customs Act, 1962.

Analysis:
1. The case involved an appeal by M/s. Kejriwal Exports against the Order-in-Appeal No. 28(AC/Exports CFS Mersk)/2009 regarding the classification of exported goods.
2. The goods were initially categorized as chappals instead of sandals, leading to a provisional assessment. The final adjudication allowed a drawback rate of 1% only.
3. The applicant challenged the Order-in-Appeal, citing non-consideration of submissions and failure to issue a Show Cause Notice under Section 18 of the Customs Act.
4. The applicant argued that the goods should be classified as "Leather Sandals with Rubber Sole" under Tariff Item 640399.10, rather than the new classification adopted by the authorities.
5. The applicant contended that the classification under the Customs Tariff and the Drawback schedule should be independent, and the goods should be eligible for Drawback under Sl. No. 640311 for Leather Sandals.
6. After a personal hearing, the Government reviewed the case records and found discrepancies in the classification of the export goods.
7. The Government agreed with some errors in the lower authorities' orders but proceeded to examine the merits of the case regarding the proper classification of the goods.
8. After analyzing the facts and relevant provisions, the Government concluded that the export item was indeed "Leather Sandals" and allowed the claimed Drawback under Sl. No. 640311A @ 7.5%.
9. The Government emphasized that the presence of wooden heels should not alter the basic classification of the goods as "Leather Sandals."
10. Consequently, the impugned orders were set aside, and the applicant's claimed Drawback was allowed under the appropriate category.
11. The Revision Application was deemed successful based on the above analysis.
12. Therefore, the impugned orders were overturned, and the applicant was granted the Drawback as per the correct classification.