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TMI Blog2023 (6) TMI 325X X X X Extracts X X X X X X X X Extracts X X X X ..... tiated an investigation against the goods declared as 'Low Aromatic White Spirit' (LAWS) imported by the Respondent (Importer) under Bill of Entry NO.9391372 dated 31.10.2020. The quantity of the imported goods is 97,280 KG (Net Weight), in 608 drums i.e. 1,19,611Litres (w.r.t. the density as 0.8133 gm/cc or KG/Litre (at 15 degree C) . The impugned goods were detained by the SIB officers on 17.02.2021 under section 110(1) of the Customs Act, 1962. 3. Upon scrutiny of the ICES system, it was noticed that the Respondent has imported the same item in the past, which has been already cleared from Customs. The details of such consignments is tabulated as below:- Table-1 Sl. No. BE No. BE Dt. Item Desc. Ass. Value (INR) Item Duty (INR) GTY (KGS) Unit Price (USD) 1. 6956777 20-02- 2020 LOW AROMATIC WHITE SPIRIT (LAWS) IN FLEXI BAG. 3830519.24 938094.20 85785.000 0.600 2. 8597573 26-08- 2020 LOW AROMATIC WHITE SPIRIT (LAWS) 2701736.40 661655.20 64000.000 0.550 TOTAL 6532255.64 1599749.40 149785.00 4. Representative samples were drawn from each container of the Bill of Entry no.9391372 dated 31.10.2020 and sent to CRCL, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 31.10.2020 as well as the two past imports tabulated in para 3 above. 10. The Notice was adjudicated vide Order-in-Original dated 27.07.2021, wherein the adjudicating authority confiscated the goods imported vide Bill of Entry No 9391372 dated 31.10.2020, but allowed re-export of the goods on payment of redemption fine of Rs 2,00,000 and imposed penalty of Rs 3,00,000 in the event of failure to re-export the same within 120 days. In respect of the past two Bills of Entry Nos 6956777 dated 20.02.2020 and 8597573 dated 26.08.2020, he imposed Redemption fine of Rs 2,00,000 and penalty of Rs.5,00,000. 11. Aggrieved against the order dated 27.07.2021, the importer filed appeal before Learned Commissioner (Appeals) who vide Order-in- Appeal dated 13.12.2021 modified the Order-in-Original dated 27.07.2021, as under; (i) Set aside the confiscation of the goods imported under the Bills of Entry dated 6956777 dated 20.02.2020 and 8597573 dated 26.08.2020, as the goods have already been cleared from customs. He also set aside the redemption fine and penalties imposed against these Bills of Entries. (ii) Upheld the confiscation of the goods imported under Bill of Entry No 9391372 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court that unless the order of assessment or self-assessment is modified in accordance with law, the said order will be deemed to have attained finality. Hence action initiated against past clearances of goods is not maintainable. (iv) Regarding the goods imported under Bill of Entry No 9391372 dated 31.10.2020, the Respondent stated that the CRCL test report dated 26.11.2020 has certified that the sample is in form of colourless liquid and composed of Mineral Hydrocarbon Oil (more than 70% by wt.) and meets the criteria of "Light Oil and Preparations". It has the other parameters of flash point 41/42 degree Celsius and IBP 146/148 degree Celsius and FBP 218/220 degree Celsius. However, on their request when the sample was sent for test in IOCL, the IOCL test report dated 12.02.2021, clearly indicated that the impugned goods have the characteristics of Mineral Turpentile Oil . This test report vindicates their contention that the impugned goods declared as Low Aromatic White Spirit are nothing but Mineral Turpentine Oil meriting classification under tariff item 271019990 of the Customs Tariff Act, 1975. (iii) The department has ignored the IOCL test report and again sought clar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder CTH 27101920. 16. Regarding the violation against PESO Licence, the Respondents contended that the impugned goods having flash point 41/42 degree Celsius falls under Class B of the Petroleum Product. The PESO License No.P/HQ/WB/15/2530(p-206171) dated 22.11.2019 available with them is valid up to 31.12.2024 allows importation of 84,000 litres of Class B of the Petroleum Product. The impugned import constitutes of 97,280 Kgs (1,19,611 Litres) Class B of the Petroleum Product, which therefore attracts violation of FTP for invocation of section 111(d) of the Customs Act, 1962.They submitted that they have applied for enhancement of the quantity which has since been approved. Therefore, section 111(d) of the Customs Act, 1962 is not applicable as far as the impugned goods are concerned. 17. Heard bothsides and perused the appeal records. 18. The issue to be decided here is the classification of the goods 'low aromatic white spirit' imported by the Respondent. The Respondent has classified the goods under CTH 27101990 and filed the Bill of Entry No 9391372 dated 31.10.2020. Revenue has reclassified the said goods under CTH 27101920 on the basis of Test Report of CRCL, Kolkata. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rein the applicability of Note 4 to Chapter 27 has been examined. The relevant portion of the order is reproduced below: "8. Further, in the instant case, sole reliance has been placed by the Ld. Commissioner on the Chemical Examiner‟s report. As rightly pointed out by the Ld. Advocate that, in the testing report it has been stated that the sample drawn from the appellant‟s premises is liquid containing mixture of hydrocarbons having distillation range from 35 degree to 58 degree Celsius and flash point below 25 degree Celsius. The classification adopted by the Ld. Commissioner is not in consonance with the Note no. 4 to Chapter 27 of the Tariff which states that "Light Oil and Preparations" are those of which 90% or more by volume (incl. losses) distilled at 210 degree Celsius, whereas the Chemical Examiner has stated that the range of distillation of product is 35 degree to 58 degree Celsius which is much below 210 degree Celsius. Hence the classification under chapter 271011 cannot be adopted. Similar observations have been made by the Tribunal in the aforesaid decision. 9. In view of the aforesaid, the classification adopted by the Ld. Commissioner cannot be ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re those of which 90% or more by volume (including losses) distil at 210 C according to the ISO 3405 method (equivalent to the ASTM D 86 method)" 25. We find that above condition as prescribed in Note 4 has not been verified in the CRCL report. It is the primary condition required to be tested for classifying any goods under CTH 27101920. From the said Note, it is evident that for the purpose of sub heading 27101920, the "light oils and preparations" are those of which 90% or more by volume (including losses) distil at 210 degree Celsius, but the test report is silent about it. As per the Test Report, the FBP is 218, which means 100% of the goods will evaporate at 218 degree Celsius itself whereas for classification of the goods as 'solvent 125/240' under CTH 27101920, the requirement as per Note 4 is that only a maximum of 90% should evaporate at 240 degree celsius. Since the entire 100% of the goods evaporate at 218 degree celsius itself, the goods are not meeting the requirements as specified under Chapter Note 4 of Chapter 27, accordingly we hold that the impugned goods cannot be classified under CTH 27101920as claimed by the Revenue. 26. The Respondent cited the decision of ..... 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