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2021 (11) TMI 738 - AT - CustomsClassification of goods - sweet corn or maize? - Scope of Show cause notice (SCN) - Levy of penalty u/s 112 of CA - Recovery of differential duty - statutory intent of primacy of section 114A of Customs Act, 1962 had been overlooked in the adjudication order - HELD THAT:- There has been no controverting of the claim of the importer that the impugned goods are ‘sweet corn’ which is, essentially, a vegetable but, owing to design of nature for propagation of the species through seed, finding fitment elsewhere too in the tariff. As use is not the criteria for classification, save where explicitly intended, the tariff accords recognition of these as ‘cereals’ to enable national policy to be determined accordingly and within the enumerations under the relevant subheading. Nonetheless, ‘sweet corn’, though a fresh cereal thereby, is further excepted from such coverage by the general notes pertaining to chapter 10 in the Explanatory Notes to the Harmonized System of Nomenclature (HSN). Consequently, ‘sweet corn’ is not ‘cereal’ for the purposes of exclusion from chapter 12 of the First Schedule to Customs Tariff Act, 1975. The permission envisaged under the Policy on Seed Development, 1988, requiring appropriate clearance by the competent authority empowered by the Plant Quarantine (Regulation of Imports into India) Order, 2003, has also made it abundantly clear that the seeds are intended for sowing. While not sufficing for classification, it does establish the description of the goods impugned in this proceeding - The adjudicating authority has not undertaken classification of the impugned goods in accordance with the General Rules for the Interpretation of the Harmonized System but set out to deny the effective rate of duty available to specific enumerations. The classification claimed by the importer in the bill of entry, even if substitutable by a more apt tariff item, cannot be discarded owing to absence of such proposal in the show cause notice. Appeal allowed - decided in favor of appellant.
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