TMI Blog2013 (1) TMI 301X X X X Extracts X X X X X X X X Extracts X X X X ..... and do not provide for monitoring that coal is to be used actually for conversion into coke before using it in metal extraction. During the period of import there was no explanation at all. We feel that adoption of a new technology enabling use of coal, which could be converted into coke in admixture with other coal, without conversion of such coal into coke cannot be a reason to deny the exemption The Chemical Examiner does not state the criteria based on which he opined that the goods were not “coking coal”. In the absence of such details the Chemical Examiner’s report is only an opinion and not a report of chemical analysis. An opinion formed by chemical examiner has very limited value because such opinion is formed without hearing the party. In favour of assessee - C/19-20/2012 - 874-875/2012 - Dated:- 25-7-2012 - S/Shri Ashok Jindal, Mathew John, JJ. REPRESENTED BY : Shri Parmod Kumar, SDR, for the Appellant. Shri C. Manickam, Advocate, for the Respondent. [Order per : Mathew John, Member (T)]. The Respondents are manufacturers of steel. They imported coal at Nagapattinam Port and filed two Bills of Entries namely 05/2010 dated 13-1-2010 declaring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods could be considered as coking coal and the exemption extended. The goods were coking coal eligible for exemption under Notification No. 21/2002-Cus., dated 1-3-2002 at Sl. No. 68. Aggrieved by the order of the Commissioner (Appeals), the Revenue has filed these appeals before the Tribunal. 3. The learned AR for the Revenue concedes that there is no specific definition of coking coal in the Customs Tariff Act or Explanatory Notes to HSN. In the exemption notification also there was no explanation for the notification was amended by Notification No. 21/2011-Cus., dated 1-3-2011 to add the following explanation :- Explanation :- For the purpose of this exemption coking coal means coal having mean reflectance of more than 0.85 and Swelling Index or Crucible Swelling Number of more than 2 4. The exemption notification was further amended by Notification No. 77/2011 dated 17-8-2011 to substitute the criteria as Swelling Index or Crucible Swelling Number to be of 1 and above. 5. The learned AR submits that the fact that the expression coking coal was not defined in the Customs Tariff or HSN Notes or Customs Notification does not mean that any type of coal could be importe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gave the opinion that the goods were not coking coal. By that time another person was holding the office of Chemical Examiner. He issued clarification as under vide his letter dated 16-1-2012 : Seen the two test reports issued by the then Chemical Examiner and the analytical data available in the lab pertaining to the samples. During the financial year 2010 - 2011 and above Mean Reflectance was not introduced by the Board as a parameter for the classification of coal. Generally it is seen that Coking Coal gives CSN value of 2 and above. The coal pertaining to Lab. No. 46/NGT/19-1-10 (B.E. No. 05/10 dated 15-1-2010) gives CSN value zero and the coal pertaining to Lab. No. 30/NGT/21-7-10 (B.E. No. 20 KKL/2010 dated 15-7-2010) gives CSN value one. It appears that the Chemical Examiner has arrived at the conclusion base on the CSN value of the respective sample. However, if felt necessary the remnant samples or duplicate samples drawn initially and kept in the department may get tested for Mean Reflectance at Central Institute of Mining and Fuel Research, CSIR, Barwa Road, Dhanbad 826 001, Jharkhand. 8. The learned AR also points out that the Commissioner (Appeals) made a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2007. Thus full exemption from duty became available irrespective of ash content with effect from 1-3-2007. The criterion that the goods should fall under heading 27.01 continued. According to him the expression is used for coal that can be used in metallurgy classifiable under Heading 27.01. As per the contract the ash content of the imported goods was 10% + 0.5% subject to rejection of goods with ash content above 11%. 11. He stated that the imported coal has been used by them for extraction of metal from iron ore. He does not deny that the coal imported by them was not converted into coke. 12. The Counsel submits that in the old process of manufacture of steel, coal was first converted into coke and coke was used in blast furnace. Later a new technology of Pulverized Coal Injunction (PCI) was developed for manufacture of steel where coal could be injected straight into specially designed furnaces for manufacture of steel. As accepted by Revenue the imported coal was ideally suited for this technology. But it could be used for coking also as evidenced from literature extracted from the web-site of the producer, relied upon by Revenue. 13. The technology was further improve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd anthracite. In addition to carbon, coals contain hydrogen, oxygen, nitrogen and varying amounts of sulphur. High-rank coals are high in carbon and therefore heat value, but low in hydrogen and oxygen, Low-rank coals are low in carbon but high in hydrogen and oxygen content. The highest rank and hardest coal is anthracite. It is found almost exclusively in remote regions of northern British Columbia and the Yukon. Anthracite is not being mined in Canada at present. Bituminous coal, ranked second highest, is found in Albenia, British Columbia and the Maritimes. Bituminous coal can be metallurgical - used to make coke for the steel industry - or thermal, used to generate electricity. 14.2.3 Australian Coal Association The Australian Coal Association, one of the leading organization dealing with coal, states that geologist classify coal types according to the organic debris, called Macerals, from which the coal is formed. Macerals are identified (microscopically) by reflected light, the reflective or translucent properties of the coal indicating the individual component Macerals and the way they have combined to form the coal. The purpose of classifying coal in this way ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to define the expression evidencing that there has been no clear intent about the characteristics to be satisfied. The criterion added by new explanation does not prescribe that the coal should have been used for conversion into coke and then used. The position is that the imported coke was suitable for use with other coal for making coke and coke making itself is for using coal in metallurgy and that the imported coal has been actually used in metallurgy without converting it into coke. We feel that adoption of a new technology enabling use of coal, which could be converted into coke in admixture with other coal, without conversion of such coal into coke cannot be a reason to deny the exemption. So we are not inclined to accept the argument of the Revenue that the goods imported could not be considered as coking coal for the purpose of customs duty for the reason that the goods were not converted into coke. 19. We are clearly of the view that the criteria added on 1-3-2011 or later cannot be applied to imports of the past. In this matter we rely on the decision of the Hon Apex Court in the case of UOI v. Martin Lottery Agencies Ltd. - 2009 (14) S.T.R. 593 (S.C). 20. We have al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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