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2024 (4) TMI 79 - AT - CustomsClassification of imported goods - plastic regrind - waste or not - restricted goods or prohibited goods - to be classified under tariff item 3915 1000 of First Schedule to Customs Tariff Act, 1975 or under tariff item 3901 1090 of First Schedule to Customs Tariff Act, 1975 - discharge of onus for displacing the declared classification - confiscation - redemption fine - penalty - HELD THAT:- The entirety of the dispute lies within the entry of goods for import under section 46 of Customs Act, 1962 and to be cleared, in terms of section 48 of Customs Act, 1962, for ‘home consumption’ subject only to satisfaction of ‘proper officer’ that duties, as leviable, has been discharged and that goods are not prohibited for import. Duties of customs are assessed as leviable by application of ‘rate of duty’ – determined by classification within First Schedule to Customs Tariff Act, 1975 – to value as determined by the valuation provisions emanating from section 14 of Customs Act, 1962. The other, viz., ‘prohibition’, is an entirely different facet of clearance and undertaken as agency function which, though resort is permissible to the Central Government in section 11 of Customs Act, 1962. The findings of the lower authorities appear to have been caught in circular reasoning of cause and effect as re-classification is seen to have been caused by references to purported restriction on import of ‘waste’ in Foreign Trade Policy (FTP) and standards formulated by Bureau of Indian Standards (BIS), which the imported goods were held to be, and the restrictions on import of ‘waste plastics’ brought to bear upon the goods consequent to determination that the goods are ‘waste’ corresponding to tariff item 3915 1000 of First Schedule to Customs Tariff Act, 1975. It is moot if the different statutes intended ‘waste’ of plastics to coincide so but that caution does not seem to have impressed itself on the lower authorities. The determination that impugned goods had been misdeclared and prohibited for import is rooted in the purported designating of ‘plastic regrind’, in two of the three consignments, as ‘waste’ by the Central Revenue Control Laboratory (CRCL) - it cannot be concluded from the test reports if the Deputy Chief Chemist concerned intended this to inform classification exercise or to be acted upon for furtherance of restriction in the Foreign Trade Policy (FTP). The onus for displacing the declared classification has not been discharged. The test reports do not lead to the conclusion that classification was to be altered or that the goods are restricted for import. In fact, the entire proceedings are vitiated by lack of any expert ascertainment of the nature of the goods - Between uninformed zeal and deliberate harassment is a very thin dividing line and no whit is added to the credibility of an institution when such blurring occurs in patently ill-considered enforcement. The impugned order is not based on appreciation of facts in totality and has not taken the proposals in the show cause notice to legal and logical conclusion - the impugned order set aside - appeal allowed.
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