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2021 (9) TMI 1267 - AT - CustomsClassification of imported goods - Base Oil SN 50 - classifiable under Customs Tariff chapter hearing 27101960 as claimed by the appellant in the bill of entry or the same is classifiable as HSD under Chapter heading 27101930 of Customs Tariff Act, 1975 as claimed by the revenue? - Confiscation - redemption fine - penalty - HELD THAT:- The entire case was decided on the basis of test conducted initially by the Central excise and Customs Laboratory at Vadodara and CRCL New Delhi. Subsequently on the intervention of Hon’ble Gujarat High Court in the petition filed by the appellant and as per direction of Hon’ble High Court the test was conducted at IOCL, Mumbai. As per IS 1460:2005 there are 21 Parameters and as per amended IS 1460:2017 it is 22 parameters. However, IOCL Lab tested 21 parameters as per IS 1460:2005. The adjudicating authority decided the confiscation on the basis of test report given by IOCL laboratory. The test report if read with the explanation given by the Shri Gobind Singh, who tested the samples, it is clear that though 14 parameters were tested as per IS 1460:2005 but in absence of testing of remaining 8/7 parameters it cannot be concluded that the goods is HSD. Upper limit of flash point - HELD THAT:- In the present case even though the Flash point tested was above 93ºC on that basis the goods cannot be classified as HSD. We also observed that the department with the pre- determined mind got the goods tested for HSD. Whereas in the first attempt since the goods was declared as base oil the sample should have been tested with parameters of base oil also and if the parameters are not meeting for the base oil than only the department should have resorted to carry out the test for classifying the goods either under HSD or any other classification. In the case of GULF FIRST PETRO PRODUCTS INDIA P. LTD. VERSUS CC., ST. & EX., COCHIN [2015 (2) TMI 297 - CESTAT BANGALORE], the dispute was whether the goods are base oil or lubricating oil on the chemical test by the customs laboratory. The flash point of the imported product was found to be above 94ºC as per chapter note 27 lubricating oil means any oil which is ordinarily used for lubrication excluding hydrocarbon oil which has its flash point below 93.3ºC. It was held by this tribunal that product having flash point above 94 ºC cannot be classified as lubricating oil and the classification as base oil has been maintained - In the present case also the flash point is 112 ºC applying the ratio of the aforesaid judgment the goods having flash point above 94 ºC will merit classification as base oil only. In this position goods cannot be classified as HSD. Since all the parameters as specified under IS 1460:2005 has not been tested it is not proved that product imported by the appellant are HSD. Since Supplementary note to chapter 27 defines the meaning of HSD that means hydrocarbon oil conforming to the Indian standard subsequently by IS 1460:2005 as amended from time to time - In the present case admittedly all the 21/22 parameters were not tested therefore product cannot be called as conforming to IS 1460:2005 and consequently cannot be classified as HSD. Thus, even if the product is base oil or otherwise but since it was not proved by the department beyond doubt that the impugned goods are HSD; the case of department got failed - irrespective of whether the base oil was correctly declared by the appellant or otherwise but since the proposed classification by the department does not sustain the case of department clearly fails, for this reason also the impugned order is not sustainable. The goods are not classifiable as HSD under CTH 271031930. Consequently the claim of the appellant for classification of goods as base oil under CTH 271019160 is maintained. The appellant have submitted that irrespective decision of classification they seek permission to re- export of goods. Though we have decided the classification as claimed by the appellant in their favour but as per the concession made by the appellant we allow the appellant to re-export the goods. As the goods are not classifiable as HSD as claimed by the revenue, the redemption fine and penalties imposed on the appellants are set aside - appeal allowed in part.
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