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Showing 201 to 220 of 6071 Records
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2002 (12) TMI 463
The Appellate Tribunal CEGAT, Mumbai rejected the appeal by the Revenue regarding the import of "Prime Ash Planking Unedged" by a manufacturer of sports goods for making hockey sticks. The Customs authorities confiscated the goods for violating import policy, but the Commissioner ruled that the goods could be imported under Open General Licence (OGL). The Tribunal upheld the Commissioner's decision, stating that the imported goods were specific for making hockey sticks and were suitable raw materials for a Small Scale Unit engaged in sports goods manufacturing. The appeal was rejected.
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2002 (12) TMI 459
Issues:
1. Eligibility for refund under Rule 173L(3)(iii) of the CE Rules, 1944.
2. Classification of Sulphuric Acid and Hydrofluoric acid under the same category of goods.
3. Exemption under Notification No. 217/86 for Sulphuric Acid.
Eligibility for Refund under Rule 173L(3)(iii) of the CE Rules, 1944:
The appeal was filed by the Revenue against the Order-in-Appeal where the Commissioner allowed the appeal of the respondents-assessee for refund. The Revenue argued that the assessee would not be eligible for a refund under Rule 173L(3)(iii) of the CE Rules, 1944. The learned Counsel for the assessee referred to the findings of the Commissioner (Appeals) and the judgment of the East Zonal Bench of CEGAT, Kolkata, which interpreted the term "same class" in a broader sense. As both the acids were considered to be of the same class, the refund was granted by the Commissioner (Appeals).
Classification of Sulphuric Acid and Hydrofluoric acid:
The Commissioner (Appeals) extensively analyzed the issue and allowed the refund by holding that Sulphuric Acid and anhydrous hydrofluoric acid fall under the same category of goods. The Commissioner relied on definitions from the Condensed Chemical Dictionary, stating that all acids contain hydrogen and have specific properties. The decision cited by the appellants in the case of Tata Tea Ltd. v. CCE defined the term "class" as a group with common characteristics. Based on these definitions and previous CEGAT decisions, it was concluded that Sulphuric acid and anhydrous hydrofluoric acid belong to the same class of goods for the purpose of Rule 173L.
Exemption under Notification No. 217/86 for Sulphuric Acid:
Regarding the entitlement to Notification No. 217/86, it was established that if the inputs are manufactured in the factory and consumed in the manufacture of a dutiable final product, exemption under the notification is available. In this case, the returned sulphuric acid was upgraded and utilized in the manufacture of anhydrous hydrofluoric acid, which was subsequently cleared on payment of duty. Therefore, the exemption under Notification No. 217/86 was deemed applicable to the sulphuric acid. The judgment of the East Zonal Bench of CEGAT, Kolkata in a similar case was found to be applicable, and the order granting the refund was upheld, rejecting the Revenue's appeal.
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2002 (12) TMI 458
The Appellate Tribunal CEGAT, New Delhi dismissed the appeal filed by the Revenue against the order-in-appeal regarding the activity of putting color cakes in a box along with a brush, stating that it does not amount to manufacture under Section 2(f) of the Central Excise Act. The Tribunal cited precedent cases to support their decision. The appeal was dismissed.
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2002 (12) TMI 457
The Appellate Tribunal CEGAT, Mumbai dismissed the appeal filed by the appellant regarding the valuation and eligibility for exemption of imported plastic sheets under entry 32 of notification 53/88. The Tribunal found in favor of the appellant on valuation but referred the eligibility question to the Commissioner. The Commissioner denied exemption, stating the goods were not made from scrap plastic. The appellant's evidence from US suppliers was deemed insufficient to prove the goods were made from scrap plastic. The claim for exemption was not substantiated with satisfactory evidence, leading to the dismissal of the appeal.
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2002 (12) TMI 456
Issues:
1. Rejection of declaration of imported goods as scrap by the Commissioner of Customs, Chennai.
2. Dispute regarding the categorization of 81.61 MTs of imported goods as scrap.
Issue 1: Rejection of declaration of imported goods as scrap
The Appellant was aggrieved by the Order-in-Original No. 22/2000, where the Commissioner of Customs, Chennai rejected the declaration of imported goods as scrap and re-categorized them as Slates/Plates. The Commissioner imposed a fine of Rs. 1,70,000/- and a penalty of Rs. 20,000/-. The dispute arose as the Commissioner did not accept the report of the National Metallurgical Lab (NML), which certified the goods as bushelling scrap. The Commissioner argued that the goods were of uniform size and shape, suitable for use without melting, and categorized them as Slate/Plates due to the importer being a trader, not an actual user.
Issue 2: Dispute regarding categorization of 81.61 MTs of imported goods as scrap
The Counsel for the Appellant argued that the samples sent to NML confirmed the goods to be bushelling scrap, satisfying IS:2549:1994 in Clause 5.18. The Counsel highlighted a previous Order-in-Appeal where the Commissioner accepted NML's report categorizing the item as metal scrap. The Counsel emphasized that the Commissioner should not deny the expert opinion and should follow precedents. The Departmental Representative reiterated the Commissioner's stance that the size of the goods warranted categorization as Slates/Plates.
The Tribunal analyzed the submissions and found merit in the Counsel's arguments. It noted that the NML report should be accepted unless there is rebuttal evidence, which was lacking in this case. Referring to a similar case where the Commissioner's decision was rejected in favor of the NML report, the Tribunal upheld the claim of the Appellant to treat 81.61 MTs as metal scrap. However, as the Appellant did not contest 13.01 MTs of longer size, the matter was remanded to the Commissioner to re-determine fine and penalty for that portion. The Tribunal directed the Commissioner to adjudicate the matter within two months from the date of the order for the uncontested portion.
In conclusion, the Tribunal ruled in favor of the Appellant, upholding the classification of 81.61 MTs as metal scrap based on the NML report. The matter was remanded for re-determination of fine and penalty for the uncontested portion, emphasizing the need for expeditious adjudication by the Commissioner.
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2002 (12) TMI 455
The Appellate Tribunal CEGAT, New Delhi dismissed the appeals filed by the Revenue regarding bulk potato chips not being branded as they did not bear the brand name of M/s. Frito Lay India, despite the manufacturer's and M/s. Frito Lay India's names being printed on the containers. The Tribunal found no merit in the appeals as the brand name "LAY'S" was not printed on the packages.
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2002 (12) TMI 454
Issues Involved:
1. Misrepresentation and diversion of imported goods.
2. Unauthorized removal of goods from the warehouse.
3. Eligibility for customs duty exemption under Section 90 of the Customs Act, 1962.
4. Settlement of duty liability and penalties.
Detailed Analysis:
1. Misrepresentation and Diversion of Imported Goods:
The applicants imported several consignments of engineering goods and filed into Bond Bills of Entry (B/E). These goods were assessed for duty and warehoused. They later filed shipping bills claiming exemption under Section 90 of the Customs Act, 1962, stating the goods were for the Indian Navy. However, investigations by the Directorate of Revenue Intelligence (DRI) revealed that the goods were diverted to the local market instead of being supplied to the Indian Navy. Statements from various individuals, including partners of the applicant firm and a storekeeper at the Naval Dockyard, confirmed the misrepresentation and unauthorized diversion of goods.
2. Unauthorized Removal of Goods from the Warehouse:
The goods were cleared without payment of duty under the pretense of being ship stores for the Indian Navy. The shipping bills were signed by a storekeeper who was not authorized to do so. The goods were taken back from the gate and sold in the local market, violating Section 71 of the Customs Act, 1962. The investigation and statements recorded under Section 108 of the Customs Act, 1962, corroborated these findings.
3. Eligibility for Customs Duty Exemption under Section 90 of the Customs Act, 1962:
The applicants claimed exemption under Section 90, which allows duty-free import of stores for use on board a ship of the Indian Navy. However, the investigation revealed that the goods were not used on a ship of the Indian Navy but were installed on a tug, which does not qualify as a ship under Section 90. The Commission emphasized that the exemption applies strictly to stores for use on a ship of the Indian Navy and not other vessels like tugs.
4. Settlement of Duty Liability and Penalties:
The Settlement Commission allowed the application to proceed and adjusted the admitted duty liability of Rs. 9,72,579/- from the amount already deposited by the applicant. The Commissioner (Investigation) concluded that the applicants were not entitled to duty exemption as no procurement certificate was issued for the goods. The Commission settled the case for Rs. 93,88,432/-, directing the appropriation of the balance deposit and payment of the remaining duty within 30 days. The applicants were also liable to pay interest at 10% per annum and a nominal penalty of Rs. 9 lakhs. Immunity from prosecution under the Customs Act, 1962, and the Indian Penal Code was granted as the applicants volunteered to settle the dispute.
Conclusion:
The Settlement Commission concluded that the applicants misrepresented the purpose of the imported goods and diverted them to the local market. They were not entitled to duty exemption under Section 90 of the Customs Act, 1962. The case was settled with a duty liability of Rs. 93,88,432/-, interest, and a nominal penalty, with immunity from prosecution granted. The settlement would be void if obtained by fraudulent means or misrepresentation.
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2002 (12) TMI 447
Issues:
Manufacture of final products using duty paid goods, clearance of empty barrels and packing cases without duty payment, classification of items as scrap, legality of duty demand, applicability of circulars and instructions, classification of goods under Central Excise Tariff Act, recovery of duty on non-excisable items.
Manufacture of Final Products Using Duty Paid Goods:
The appellants, manufacturers of Tyres, Tubes, and Flaps, availed credit of duty paid goods for manufacturing final products. However, they cleared empty barrels and packing cases without paying duty on such removals. A show cause notice was issued demanding duty payment of Rs. 1,84,170 for the period from February 1998 to July 1998, alleging that the items should be treated as scrap generated in the process.
Legality of Duty Demand and Circulars Applicability:
The Order-in-Original by the Assistant Commissioner of Central Excise was upheld, citing instructions from the Department and the Board clarifying that duty need not be paid on empty containers. The Board's withdrawal of a previous letter was deemed prospective, not retrospective, affecting demands made before the withdrawal. The Department's appeal in the Supreme Court did not grant a stay, and any decision would apply prospectively, not affecting the present case.
Classification of Goods Under Central Excise Tariff Act:
The judgment highlighted that used goods like barrels and plywood boxes, being old and used, cannot be classified as manufactured goods under the Tariff Act unless specified. The lower authorities failed to classify the subject as scrap under the Tariff Act, leading to an improper attempt to recover duty on non-excisable items. The goods removed should be classified under the Tariff based on their form at removal, not merely as containers emptied of contents.
Decision:
The judgment set aside the lower authorities' order and allowed the appeal, emphasizing the correct classification of goods under the Tariff Act and the binding nature of circulars on the Department. It concluded that the demand for duty on the removed items was not justified, considering the legal provisions and circular instructions in force.
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2002 (12) TMI 446
The Appellate Tribunal CEGAT, Chennai found a defect in the order passed by the Joint Commissioner of Customs instead of the Commissioner of Customs. The appellant claimed his statement was taken by force and denied involvement in smuggling. The Tribunal remanded the matter for re-consideration by the correct authority, emphasizing the appellant's right to defend himself.
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2002 (12) TMI 441
Issues:
Service tax liability on services provided to customers from July 1994 to September 1998.
Analysis:
The judgment concerns the appeal regarding the service tax allegedly not paid by the appellants for services provided to their customers. The appellant's representative argued that a significant portion of the amount on which tax was levied belonged to cancelled bills and un-realized amounts from customers. They contended that no service tax should be paid on cancelled bills, and tax liability arises only upon realization of consideration for services provided. Reference was made to Section 65(16) of the Finance Act, 1994, defining "taxable service," and the impact of the Finance (No. 2) Act, 1998, which substituted "received" with "charged." The representative also cited a Delhi-II Commissionerate's Trade Notice and a Supreme Court decision to support the argument that service tax is leviable only on the amount actually received by the service provider.
Regarding the tax demanded for July 1994, it was argued that the Finance Act, 1994, related to service tax was received after July 1, 1994, and thus, there was no scope for levying service tax on rental in bills issued in July 1994. Additionally, the representative contended that no service tax was leviable on the surcharge collected for delayed payment on telephone bills, citing a Board's Service Tax Circular. The imposition of personal penalty and confirmation of interest were also challenged.
However, it was acknowledged that these issues were not raised before the Commissioner, and the appellant did not have the opportunity to address them. Given that the disputed issues involved factual aspects, the matter was remanded to the original adjudicating authority for a fresh decision, considering the appellant's submissions. The appellants were granted the opportunity to present their case before the Commissioner and raise the above arguments. The appeal was disposed of accordingly, emphasizing the appellants' right to address the issues at the original level.
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2002 (12) TMI 440
The judgment involves the classification of rubberised dipped nylon tyre cord fabrics for excise duty. The appellant argues for classification under Heading 59.06, while the Revenue argues for Heading 59.02. The Tribunal sets aside the order and remands the matter to the Commissioner for fresh adjudication based on Tribunal decisions classifying under Heading 59.06. The issue of limitation is also to be reconsidered. Appeal allowed for remand.
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2002 (12) TMI 435
Issues:
1. Whether royalty/license fees payable by the importer to the foreign supplier are addable to the value of imported components under Rule 9(1)(c) of the Customs Valuation Rules, 1988.
Detailed Analysis:
The appeal in this case was filed by the department against an Order-in-Original passed by the Deputy Commissioner, which stated that the supplier and the importer are related as per Rule 2(2)(v) of the Customs Valuation Rules, 1988. The importer and the supplier were found to be related entities, and the transaction value declared in the import invoice was suggested to be accepted under Rule 4 of the Customs Valuation Rules, 1988, subject to verification. The Order-in-Original did not consider any suppression or mis-declaration affecting the invoice value, leaving it to be addressed under the appropriate law and procedure when noticed.
The grounds of appeal highlighted that the importer had entered into a Technical Collaboration Agreement with a US-based company, and there were subsequent transfers of assets and agreements involving various parties. The dispute arose regarding the addition of royalty mentioned in the Technical Collaboration Agreement to the transaction value, as per Rule 9(1)(c) of the Customs Valuation Rules, 1988. The department argued that since the technical information supplied by the foreign entity was used in manufacturing the imported goods, the royalty payment should be included in the assessable value. However, the importer contended that the royalty was not related to the imported products but rather to the manufacture of licensed goods in India.
During the personal hearing, both parties reiterated their positions, with the department emphasizing the relevance of adding royalty to the value of imported components, while the importer maintained that the royalty was unrelated to the imported products. The Commissioner examined the submissions made by both parties and reviewed the facts of the case as per the records presented.
Upon analysis of the Technical License Agreement and the mode of calculation of royalty, it was observed that the value of the imported components was excluded from the calculation of royalty payable to the foreign supplier. Rule 9(1)(c) allows for the addition of royalty related to imported goods that the buyer is required to pay directly or indirectly. However, since the royalty payment excluded the price of the imported components used in manufacturing the licensed goods, there was no direct or indirect relationship between the royalty and the imported goods. Therefore, the Commissioner rejected the appeal, concluding that the royalty was not addable to the value of the imported components under Rule 9(1)(c) of the Customs Valuation Rules, 1988.
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2002 (12) TMI 434
Issues:
Imposition of penalty under Rule 173H for not removing goods within six months as provided, applicability of penalty under Rule 210, justification of penalty based on breach of rules, validity of Trade Notice prescribing a time limit of six months, and the power of Revenue officers to impose penalties.
Analysis:
The appeal challenged the imposition of a penalty of Rs. 1,000 confirmed by the Commissioner (Appeals) due to the appellants not removing certain goods for repairs/re-conditioning within the stipulated six-month period under Rule 173H. The grounds of appeal included the delay in rectifying defects due to damaged goods, financial constraints delaying disposal, and reliance on a case law stating no prescribed time limit under the Rule. The appellants argued against the penalty citing absence of penalty provision in Rule 173H(i)(d) and non-receipt of Trade Notice No. 25/93 prescribing the six-month limit.
During the hearing, the appellants did not appear, and an adjournment request was made. The ld. DR supported the lower authorities' findings, emphasizing the breach of Rule 173H and the penalty justification under Rule 210 for rule violations. The Commissioner (Appeals) upheld the penalty citing the breach of the time limit set by the Trade Notice. However, the Tribunal judge disagreed with the penalty imposition, referencing the Supreme Court's stance that penalties need not be imposed for technical breaches. The judge highlighted that penalties should aim for curative and demonstrative effects, not retribution, and should not be used as a punitive measure.
In the judge's analysis, it was noted that the goods were not held with an intent to evade duty, were not liable for confiscation, and the breach did not warrant penalty imposition. The judge referenced the case of M/s. Hindustan Steel to support the stance that penalties should not be imposed for minor breaches. Ultimately, the judge set aside the penalty and allowed the appeal, emphasizing that penalties should serve a corrective purpose and not be applied as punitive measures without justification.
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2002 (12) TMI 433
Issues:
1. Confiscation and penalty imposed on exporting company for misdeclaration of goods in the drawback shipping bill.
2. Appeal against the order of the Commissioner of Customs (Appeals) by the Revenue.
Analysis:
1. The case involved appeals by the Revenue against an Order-in-Appeal passed by the Commissioner of Customs (Appeals) regarding the misdeclaration of goods in a drawback shipping bill for the export of a corrugated plant. The machinery was declared as new in the bill, but upon examination, it was found to be reconditioned. The Additional Commissioner held the goods liable for confiscation and imposed penalties. However, the Commissioner (Appeals) allowed the appeals stating that the goods were not prohibited for export, and there was no finding on the intention to misdeclare. The Appellate Tribunal found that the goods did not correspond with the entry made in the shipping bill, attracting Section 113(i) of the Act. The Tribunal set aside the order of the Commissioner regarding confiscation and penalties, holding the exporting company liable for redemption fine and penalty imposed in the Order-in-Original.
2. The Tribunal emphasized that the declaration of the goods as new in the shipping bill was crucial for claiming drawback, and the evidence proved the declaration false. The Tribunal disagreed with the Commissioner's observations on the absence of prohibition on exporting old machinery, as the issue was whether the entry in the shipping bill matched the goods. Since the goods were old and not eligible for drawback, the Tribunal allowed the Revenue's appeal, restoring the Order-in-Original for confiscation and penalties. The Tribunal also cited a Supreme Court decision to emphasize that the export of goods before adjudication did not affect the case's outcome.
3. Regarding the appeal seeking the restoration of the penalty on an individual, Shri Kasat, the Tribunal found no evidence of his personal involvement in the misdeclaration. As a result, the penalty on Shri Kasat was set aside, and the appeal by the Revenue on this issue was rejected. The Tribunal's decision was based on the lack of evidence linking Shri Kasat to the misdeclaration of goods or false claims for drawback, leading to the rejection of the Revenue's appeal on this specific matter.
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2002 (12) TMI 431
Issues:
1. Customs duty on stores and bunkers in relation to the LDT of a ship for breaking.
Analysis:
The appeal before the Appellate Tribunal revolved around the question of whether customs duty is separately leviable on stores and bunkers or if these goods should be included in the LDT (light displacement tonnage) of the ship brought for breaking. The Appellant, represented by Shri A.D. Maru, argued that the oil stored in the engine room tanks should not attract separate duty as it is considered an integral part of the vessel's machinery and engines. Reference was made to the definition of LDT of a ship and relevant publications to support this argument. Additionally, it was contended that food-stuff consumed by the crew members during the ship's stay period till beaching should not be subject to customs duty under specific provisions of the Customs Act.
On the other hand, the Respondent, represented by Shri Atul Dixit, countered these arguments by highlighting the classification guidelines under Board Circular No. 37/96, which differentiate between fuel and oil contained in the vessel's machinery and engines and other ship stores. It was emphasized that the fuel kept in the engine room cannot be considered part of the engine and machinery, leading to separate classification. The Respondent also pointed out that the provisions of Sections 86 and 87 of the Customs Act regarding the consumption of stores on board foreign-going vessels do not apply in the case of a ship imported for breaking, as it ceases to be a foreign-going vessel.
After considering the submissions from both sides, the Tribunal analyzed the classification of oil, fuel, and food-stuff in the context of the Customs Act and relevant circulars. It was concluded that the fuel and oil in the engine room tanks are to be classified with the ship under a specific heading, while the remaining fuel and oil in other tanks, along with food-stuff, are to be charged duty separately. The Tribunal upheld the classification principles outlined in the Circular and rejected the Appellant's argument regarding the assessment of the Bill of Entry at this stage of the appeal, citing a relevant legal precedent.
In conclusion, the Tribunal dismissed the Miscellaneous Application filed by the Appellants, maintaining that they cannot challenge the assessment of the Bill of Entry at this stage. The appeal was disposed of based on the classification principles established for oil, fuel, and food-stuff in relation to the LDT of a ship imported for breaking, as per the Customs Act and relevant circulars.
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2002 (12) TMI 430
The Appellate Tribunal CEGAT, Mumbai allowed the appeal of a manufacturer of Indian perfumes regarding the importation of glass bottles for packing Attar. The Customs Authorities had confiscated the bottles, deeming them consumer goods not allowed for import. However, the Tribunal found that the bottles were essential packing material for the perfumes and not consumer goods, overturning the confiscation order and directing the return of redemption fine and penalty amounts to the appellants.
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2002 (12) TMI 429
The Appellate Tribunal CEGAT, Mumbai waived the pre-deposit of duty and penalties for the importer M/s. Bharat Vijay Iron Factory and other registered dealers based on lack of direct evidence regarding the change in form of input. The Tribunal stayed the recovery of duty and penalties pending the appeals. Both parties can mention the appeal outcomes later.
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2002 (12) TMI 428
The Appellate Tribunal CEGAT, Mumbai waived pre-deposit and disposed of the appeal itself. Show cause notice issued beyond the limitation period for Modvat credit was held invalid. The demand was found to be barred by limitation, and the appeal was allowed.
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2002 (12) TMI 427
The Appellate Tribunal CEGAT, Mumbai allowed the appeal regarding denial of Modvat credit on various items including solution vessel, cylindrical vertical tank, modules with membranes, primary nickel cathodes, and cable trays. The denial was overturned based on explanations provided for each item's admissibility under Rule 57Q. The appeal was successful for all contested items.
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2002 (12) TMI 425
Issues:
1. Misdeclaration of grade of imported copper scrap - Birch Grade vs. Dream Grade.
Analysis:
The appellant imported copper scrap declared as "Dream Grade as per ISRI," but a show cause notice alleged that the scrap was actually of Birch Grade. The adjudicating authority confiscated the goods, enhanced their value, and imposed penalties. The Tribunal remanded the matter, leading to the impugned order based on the remand order.
The key contention was whether the imported copper scrap was Birch Grade or Dream Grade as per ISRI guidelines. Birch Grade consists of unalloyed copper wire with a nominal 96% copper content, while Dream Grade includes unalloyed copper scrap with a nominal 92% copper content. After testing samples, it was found that the copper content was less than 90% when tested as such, indicating Dream Grade. The Revenue argued that after cleaning the samples, the copper content was around 96%, alleging misdeclaration as Dream Grade.
Post remand, samples were tested, revealing that the copper content was over 95% when cleaned, but less than 90% when tested as such. Considering the ISRI guidelines and the test results, the Tribunal concluded that the scrap in question was of Dream Grade. Therefore, the allegation of misdeclaration regarding the grade of scrap and valuation was deemed unsustainable, leading to the impugned order being set aside, and the appeals being allowed.
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