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2014 (3) TMI 209 - CESTAT AHMEDABADClassification of Magensia Spinel Bricks - Import of goods - exemption notification No.90/2004-Cus - classification under CTH 69021090 , as ‘other bricks’ or under CTH 69021010 - Held that:- The mother of all Harmonised tariffs in international trade is the Harmonized Description and Coding System commonly known as ‘HSN Explanatory Notes’. - As per the international standards refractory bricks containing by weight, singly or together, more than 50% of Magnesium has to be considered as Magnesite Refractory Bricks. - In the case of appellants, the content of MgO is more than 50% and will thus be a category of Magnesite Refractory Bricks. These categories of bricks have been allowed to be imported only for those who are using this quality of bricks as per SION A-1050. In the case of the appellant also the entire quantity imported has been used in the manufacture of goods for which export obligation has already been fulfilled. There is no evidence or argument on behalf of the Revenue that the Refractory bricks imported by the appellant have been diverted or sold to others. The interpretation to be made under SION is not subordinate to the sub-headings made under CTH 69.02 of the Customs Tariff Act 1989. Both Customs Tariff interpretation and SION interpretation cater to different situations, especially when the Tariff sub-headings are different under CTH 69.02 and HSN Explanatory Notes/SION norms. It has thus been correctly argued by the appellant that action if any under SION and DIFA/DFRC violations has to be taken by the appropriate authorities under DGFT and Customs can only bring to the notice of DGFT authorities of any ambiguity in the imports made by the appellant vis-`-vis authorizations issued by DGFT. Otherwise also, appellant would have been entitled to drawback on the export product if duty was paid on the refractory bricks at the time of imports. It is thus a case of revenue neutrality as it is a well established policy of the Central Government to have zero-rated exports. Accordingly, on merits it is held that benefit of exemption under Notification No.90/2004-Cus, dt.10.09.2004 and Notification No.40/2006-Cus, dt.02.05.2006 has been correctly availed by the appellant. Extended period of limitation - Revenue neutral situation - Held that:- Once appellant has used the entire quantity of imported goods with respect to the manufacture of exported goods, it cannot be said that there could be any intention to evade Customs duty. Alternately, appellant could have also availed incentives like Drawback, rebate, CENVAT Credit etc. at the time of export and accordingly, there cannot be any intention to evade duty attracting extended period in this case, as it is a case of revenue neutrality. Demand set aside on merit as well as on the issue of period of limitation - Decided in favor of assessee.
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