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2022 (4) TMI 1370 - AT - CustomsClassification of imported goods - gold coins (round) (other than legal tender) - to be classified under CTI 7114 19 10 or under CTI 7114 19 10? - rejection of exemption under notification dated 31.12.2009, as amended by notification dated 31.12.2016 - recovery of differential duty with interest - HELD THAT:- The central excise tariff is broadly based on the system of classification derived from the International Convention called “The Brussels Convention on the Harmonised Commodity Description and Coding System” (HSN) with necessary modifications. In this connection, it will useful to reproduce the Statement of Objects and Reasons of the Central Excise Tariff Bill, 1985 which led to the enactment of the Central Excise Tariff Act, 1985. A perusal of CTH 7114 and heading 71.14 of HSN clearly shows that they are identical. Likewise, CTH 7114 19 is identical to sub-heading 7114.19 of HSN. It is also seen that CTH 7118 is identical to heading 71.18 of HSN and CTH 7118 10 and CTH 7118 90 are identical to sub-headings 7118.10 and 7118 90 of HSN. It is clear that sub-headings 7118.10 and 7118.90 of HSN will cover only that sub-category of ‘COINS’ which fulfill the aforesaid conditions and the sub-headings cannot be read in a manner so to over ride or travel beyond the Explanatory Notes provided for the main heading. Thus, coins of heading 7118 of HSN would be those made by stamping sheet and struck with appropriate dies of officially prescribed weight and design and issued under government control for use as legal tender. Sub-heading 7118.10 of HSN would cover coins which are no longer legal tender or intended to be legal tender, while sub- heading 7118.90 of HSN would cover coins which are legal tender in the country of issue - when HSN is a safe guide for tariff classification under the Tariff Act, CTH 7118 under which the description of goods is ‘coin’ would apply to coins of any metal of officially prescribed weight and design issued under government control for use as legal tender. CTI 7118 10 00 and CTI 7118 90 00 would cover only that category of ‘coins’ which fulfill the aforesaid conditions. For the reasons stated while examining sub-heading 7118.90 of HSN, CTI 7118 90 00 would cover coins which are legal tender in the country of issue. Whether the appellant is justified in classifying the goods under CTH 7114? - HELD THAT:- If the classification under CTH 7114 is correct there is no prescription under the Foreign Trade Policy regarding restriction on the goods. Even if the goods are held to be classifiable under CTH 7118, Regulations have not been issued by the RBI in this context. Regulations can be issued by the RBI only under section 58 of the Reserve Bank of India Act, 1934 or section 47 of the Foreign Exchange Management Act, 1999 [FEMA]. Section 58 of RBI Act requires such Regulations to be issued only by way of a notification with the previous sanction of the Central Government. Section 48 of FEMA requires Regulations issued under section 47 FEMA to be presented before the parliament Such Regulations have not been placed by the Department and only a reference has been made to a letter issued by the RBI dated 13.09.2017 or the DGFT Memorandum. These cannot be termed as Regulations issued by RBI or under FEMA. The power of RBI to issue directions under section 11 of FEMA extends only to authorized person with regards to making payment for foreign exchange or foreign security and RBI cannot regulate imports which are in the exclusive domain of DGFT. Appeal allowed.
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