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2015 (12) TMI 1000 - AT - CustomsConfiscation of imported goods being warp cut pile fabrics - velvet effect - Denial of the benefit of Notification No.30/2004-CX dated 09.07.2004 - Classification under under CTH 58013711 or CTH 50079090 - Imposition of redemption fine and penalty - Held that:- If the appellant had been aware of the intelligence received by DRI then amendment should have been sought exactly for the description as per the details found during examination of the goods. The amendment was sought only as per the e-mail dated 03.11.2014 received from the supplier of the goods which was not the actual description found on examination. Accordingly we are of the view that oral request for amendment was made on 03.11.2014 and appellant was not aware of the exact description of goods at the time of filing the bill of entry that a part of the goods will be fabrics of CTH 5801. Appellant also asked for 100% examination of the imported goods and there was an option from the seller of the goods to return the same. However, as the amendments sought was not for the correct description of goods, therefore, the same could not have been allowed by the Adjudicating authority. However, reasoning of Adjudicating authority for rejection, that amendment application was filed after receipt of DRI intelligence, is not correct as appellant has not sought the exact description of goods in the written amendment application dated 10.11.2014. It is accordingly held that request for amendment was not influenced by the intelligence received by DRI. Goods imported by the main appellant are warp cut pile fabrics whereas velvet effect can be obtained both by “uncut pile” as well as “warp cut fabrics”. As per above distinctions available an “uncut pile fabrics” will be classifiable under CTH 58013711 and 58013719 but all such uncut pile fabrics need not be known as velvets. On the other hand warp pile fabrics (including cut velvet) will be classifiable under CTH 58013720. Scientific literature furnished by the appellant do indicate that there are categories of uncut pile fabrics in the market which are also known as velvets (Epingle & Terry Velvet). Corresponding entries under Customs Tariff for Cotton Velvet fabrics are 5801 2710 & 5801 2720 but the word “velvet” has not been mentioned in these classification at all. The crucial words are “warp pile fabrics, cut” (58012710) & other (5801 2720). Thus more important in the classification of a fabric under 5801 3711/19 and 5801 3720 will be the “cut” or “uncut” nature of “warp pile”. Accordingly we are of the considered opinion that stand of the Adjudicating authority and the learned A.R., that all categories of “velvet” fabrics will invariably fall under 5801 3711, is not correct and is rejected. So far as exemption from CVD under Notification No.30/2004-CE dated 09.07.2004 is concerned, the case of the appellant is that no CENVAT Credit used in the manufacture of imported goods could have been taken as the same were not manufactured in India - appellant are entitled to CVD exemption under Notification No.30/2004 dated 09.07.2004. Appellant came to know about the discrepancy and mix up in some of the imported goods as per e-mail dated 03.11.2014 from the supplier and appellant made a bill of entry amendment request as per the changed description given by the supplier of the goods. Existence of such an e-mail and its receipt by the appellant is not disputed. If the appellants had come to know of the investigation being conducted by DRI then they could have given the exact description of the goods found during physical examination. There is no evidence on record that appellants had prior knowledge of the exact description of goods and we hold that the conclusions drawn by Adjudicating authority are based on presumptions and surmises. Under the existing factual matrix orders regarding confiscation of goods and imposition of penalties upon the appellants and confiscation of goods under Section 111(m) and Section 119 of the Customs Act, 1962 are not justified and are set aside - Decided against Revenue.
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