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2021 (12) TMI 490 - CESTAT MUMBAIClassification of imported goods - items imported for deployment in their ‘motorcycle’ production lines - to be classified under tariff item 8483 9000 of First Schedule to Customs Tariff Act, 1975 or heading 8714 of First Schedule to Customs Tariff Act, 1975? - legality of discarding a tariff item, and whose description is not contested for inaccuracy, on the finding that the intent of the exclusion in sections XVI of First Schedule to Customs Tariff Act, 1975 accords primacy to ‘end use’ for determining classification or not - HELD THAT:- The resolution of adversarial conflict in classification of imported goods by comparison of the claimed classification and counter-proposal of assessing authorities can be undertaken only after establishing that the distinction between the two is only one of degree. It is, therefore, not sufficient that the assessing authority demonstrate the claim to be wrong; the proposed classification should be shown to be correct failing which the claim shall, by default, prevail. Except where an exclusion is specific, the notes can only afford guidance in isolating the appropriate tariff item in the First Schedule to Customs Act, 1975 to which the test of rule 3 of the General Rules for the Interpretation of Import Tariff appended to Customs Tariff Act, 1975 is applied. One of the fundamental principles of classification is that the identified tariff item should describe, as nearly as possible, the goods as presented. Usage as determinant, or subsuming within broader descriptions, must have specific sanction of the notes as laid down in rule 1 of the General Rules for the Interpretation of Import Tariff. It is also clear from the Rules that the comparison should be at ‘heading’ level before proceeding within the more appropriate of the two for identification of the applicable sub-heading and tariff item - the proposed heading is that of ‘parts and accessories’ of vehicles. The aptness of this heading can be elicited only from the scope of the description corresponding to heading 8714 of First Schedule to Customs Tariff Act, 1975 which pertains to motorcycles, bicycles and carriages for disabled persons. It is apparent that the imported goods are not solely or principally employable only for the production of ‘motorcycles’ and, except for familiarity with the business activities of the importer or the elaboration in the invoice, is not easily ascribable to usage in motor vehicles. The absence of a finding that the impugned goods are, from their description, best described as ‘parts and accessories’ of ‘motorcycles’ invalidates the proposed classification by failing to discharge the onus of determining the appropriate tariff item to qualify as a rival to the claimed classification. The exclusion note is not a tenable alternative to fulfillment of this obligation on the part of customs authorities. The classification under heading 8714 of First Schedule to Customs Tariff Act, 1975 fails the test of law and is, therefore, set aside to uphold heading 8483 of First Schedule to Customs Tariff Act, 1975 as declared by the appellant in the bills of entry - Appeal allowed in part.
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