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TMI Blog2021 (9) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... ags, the goods were found to be in form of ash type powder. The representative samples were drawn and sent to Customs House Laboratory, Kandla under test memo no 02/2015-16dated 20.04.22015 for testing. The Joint Director,Customs House Laboratory, Kandla vide test report No544 dated 21.04.2015 reported that the subject product is not slaked lime but is a product prepared from slaked lime having metallic additives and other than the product classifiable in chapter25 of customs tariff. Further vide letter dated 04.06.2015 customs house laboratory kandlasubmitted detailed test report. 1.2 On the basis of such report it was contented that the subject imported goods have been misdeclared as Lime Mortar (Slaked Lime) and misclassified under CTH 25222000 and hence the goods were seized. The said goods wasprovisionally released by the Joint Commissioner Import and CH, on submission of bond of full value of the goods and revenue deposit of differential duty amount of Rs. 139845/- and accordingly bill of entry no 8924690 dated 15.04.2015 was provisionally assessed. The statement of proprietor of the appellant company was recorded on 25.11.2016 and after analyzing Wikipedia and Harmonized Sy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is against the explanatory notes to Chapter 25 therefore, the opinion is wrong to the extent it state the imported goods as preparation and not naturally occurred goods. He submits that chapter 2522 clearly state that the slaked lime (impure calcium oxide) pertains to chapter 2522 itself. The imported goods cannot be classified under chapter 382450 since asper the chapter sub heading of 382450 the product must be binding preparation while the goods under consideration is reported as expanding nature. As regard the demand of Differential duty in respect of 11 Bills of Entry it is also bad in law as hit by limitation since all the bills of Entry were finally assessed Bills of entry. The finally assessed bills of entry are considered as order and therefore, the same cannot be reviewed by issuing SCN after expiry of two Years. 2.2 He further submits that in case of classification dispute the extended period cannot be invoked. The test report in respect of one particular consignment cannot be applied to another consignment. He submits that since there is no misdeclaration or classification of goods the imported goods are not liable for confiscation under section 111(m) of Customs Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ading 2505.10. 2.3 As regard test report he submits that as the test report issued by CHL Kandla it contains self contrary result. In the said report it is stated that the impugned goods is a preparation but failed to established under what formula/ process the said preparation is prepared. The test report is also failed to state that the actual percentage of metallic additive in the said formula. There is no benchmark was shown as to how the imported goods become preparation based on certain formula. The formula was even not given in the said test report though the test report stated that the goods isthe preparation however, no explanation was given why the same is preparation. The test report in this context is not reliable. He submits that even as per the test report the percentage of slaked lime is 82.8% therefore, the imported goods are not preparation as stated by the chemical examiner in his report. 2.4 He submits that as regard the finding in the impugned order that as per the test report the preparation is based on different ingredients may include processes like calcination, hydration, roasting/drying followed by other reactive ingredients . The product is specially des ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he chapter heading 2522.Even the entry in the tariff is clear enough and without confusion. He further submits that as per the Chapter note 3 of the chapter 38 clearly stated that the heading 3824 includes only those goods which are not to be classified in any other heading. Therefore, the chapter heading 3824 is considered as residual chapter. Since the goods is slaked lime and clearly classifiable under the chapter 2522, residual chapter heading cannot be applicable in the present case. 2.7 The chapter 3824 is specifically meant for "Prepared Binders" only whereas admittedly the goods under question having expanding characteristics which is clearly different from binders hence cannot be classified under chapter 38245090.This again shows that the test report is prepared under duress of inquiry officer and therefore, it cannot be relied upon. 2.8 He submits that it is settled law that the test report of current consignment cannot be applied on the previous consignment . He placed reliance on the following judgments: * SHALIMAR PAINST LIMITED - 2001(134) ELT 285 (Tri- Kolkata) upheld by the Hon'ble Supreme Court -2002(145)ELT A242 * STELLA INDUSTRIES PVT LTD- 2017(357)ELT 197( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f contents are iron, aluminium and silicious matters which obviously exits in any natural mineral product therefore, it is not established that the slaked lime is not a naturally occurred product but a preparation as contented bythe revenue. Therefore, merely on the basis of the test report which is contrary to the opinion cannot be accepted. The relevant explanatory note to chapter 2522 is necessary to be gone through to arrive at conclusion which is reproduced below: From the plain reading of above explanatory note it is clear that the goods Slaked lime found a specific entry at 25222000 after the sub- heading related to Quick lime even though the quick lime is obtained through calcining process the same is classified under chapter 2522. Similarly, Slaked lime is produced when the water is combined with the quick lime it giving offconsiderable heat and producing slaked lime.This slaked lime is also found entry at the chapter sub heading 25222000. The quick lime and slaked lime are impure calcium oxide in nature and chemically known as calcium hydroxide. 4.2 As per Chapter note 1 of Chapter 2522 which covers mineral product only in crude state or washed(even with chemical substa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or obtained by mixing." 10. In the aforesaid Note, after mentioning the products, there is again an exclusion clause which excludes the products that have been roasted, calcined or obtained by mixing. Calcination was excluded there as well. However, when this Head Note is contrasted with Head Note 2 which was introduced in the year 1990, we find significant addition of words in the beginning of the said Note which are "except where the context otherwise requires". Therefore, the exclusion of calcination would not apply in respect of those products where the context otherwise includes calcination. Chapter Heading 25.05 which has already been reproduced above mentions under Entry 2505.10 "Kaolin and other kaolinic clays, whether or not calcined". It is not in dispute that the china clay otherwise is known as Kaolin as well and the process of Kaolin is same as that of china clay. Here the Kaolin is included under Entry 2505.10, i.e., under Chapter Heading 25.05, even when it is calcined. Therefore, it follows from the above that the context here requires such a product to remain included under Chapter 25.05 even when it is calcined. We find that the amended/new provision in the for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... site www.wildturmeric.net wherein the slaked lime was explained which is reproduced below: "When quick lime reacts with water it forms slaked lime. Many confuse slaked lime with quick lime, slaked lime is calcium hydroxide and quick lime is calcium oxide and both are known by the same common name as lime. It is also called slaked lime." From the above it is clear that the quick lime when reacts with water it forms slaked lime and the slaked lime is calcium hydroxide. Accordingly, it is clear that the goodsin question is slaked lime under chapter heading 2522. 4.4 It is also found that chapter subheading 38245090 where under classification proposed by the department is a residual entry whereunder only those goods are to be classified which are not classifiable in any other heading. In this regard the relevant chapter note 3 to chapter 38 is reproduced below: "3. Heading 3824 includes the following goods which are not to be classified in any other heading of this Schedule: (a) cultured crystals (other than optical elements) weighing not less than 2.5 g each, of magnesium oxide or of the halides of the alkali or alkaline-earth metals; (b) fusel oil; Dippel's oil; (c) ink r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entral Excise Act, 1944 by obliteration of the proceedings leading to the impugned order. The mandate of the law pertaining to recovery of duties not paid or short-paid will have to be followed to the letter." The above decision of the tribunal is based on the view taken by the Hon'ble Supreme Court in the case of WARNER HINDUSTAN LIMITED -(1999) 6 SCC 762 wherein the Hon'ble Supreme Court has held as under: "In our opinion, the tribunal was quite wrong in these circumstances in allowing the appeal of the Excise Authorities and classifying the mint tablets as items of confectionary under Heading 17.04. The correct course for the tribunal to have followed was to have dismissed the appeal of the Excise Authorities making it clear that it was open to the Excise Authorities to issue a fresh show cause notice to the appellant on the basis that the tablets were classifiable under Heading 17.04 as items of confectionary. This would have given the appellant the opportunity to place on record such material as was available to it to establish the contrary. It is impermissible for the Tribunal to consider a case that is laid for the first time in appeal because the stage for setting out th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and for which the Revenue has not adduced any evidence to shift the classification to heading 32.10." This case is upheld by the Hon'ble Supreme Court -2002(145)ELT A242 * STELLA INDUSTRIES PVT LTD- 2017(357)ELT 197(Tri- Del) "9. Now we turn to the second part of the demand involving goods which have been already exported under various shipping bills. Customs duty demand of Rs. 11,58,438/- has been raised along with interest and imposition of penalty. The basis for raising such a demand is the averment by the Executive Director in his statement to the Investigating officer to the effect that in the past also they have exported identical goods as have been attempted to have been exported in two shipping bills. On the above statement, Customs authorities have concluded that goods exported in the past also were made of alcohol content more than 70%. From the record, we also note that no sample of the goods covered by earlier consignments have been drawn by the Customs Authorities. Further, there is no reference to any test reports of such earlier samples." * MARKS MARKETING PVT.LTD- 2017(346) ELT 144 (Tri.-Del) "9. We find no merit in the above statement of the Revenue. Adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... favour of the appellants. It was free for the department to get another test conducted in 2005 also. This having not done, extended period cannot be invoked. Suppression of fact cannot be alleged on the basis of statements of dealers to conclude that the goods cleared in the past are also similar to the goods tested. Unless such goods are available and tested, nature of the goods cannot be established on the basis of oral submissions. Therefore, we find that the invocation of extended period is not tenable. Therefore, we find that the demand for period prior to 5-2-2006 is barred by limitation. Therefore, the classification prior to 5-2-2006 is of no help to the case. For quantification of the duty for the normal period, the case needs to be remitted to the original authority." 4.8 In view of the above settled legal position the test of one particular consignment cannot be used to override the test conducted in respect of past consignments for deciding theclassification in respect of previous consignment test report of the same was not under dispute. Therefore, for this reason also the demand of duty amount, consequential penalty in respect of previous consignment is not sustaina ..... X X X X Extracts X X X X X X X X Extracts X X X X
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