TMI Blog2023 (6) TMI 325X X X X Extracts X X X X X X X X Extracts X X X X ..... andard 1745 and the result received for the impugned goods. Hence, the impugned goods cannot be classified under chapter sub heading 27101920, on the basis of the parameters available in the CRCL, Test Report dated 26.11.2020. Revenue has relied upon the Note 4 to Chapter 27 for classifying the impugned goods under the CTH 27101920 - the 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 N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CES 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CL further clarified that there is no available standard/literature/specifications for the description Low Aromatic White Spirit . 8. Another reference was made vide letter dated 20.04.2021 to CRCL, New Delhi , who vide report dated 05.05.2021 opined that the sample under reference meets the requirements of Light Oils and Preparations as mentioned in sub heading Note 4 of Chapter 27. The sample also meets the requirement of solvent 125/240 mentioned in IS 1745:2018. 9. Therefore, a Show Cause Notice dated 28.05.2021 was issued to the Respondent proposing to reject the classification of 27101990 claimed by them and reclassify the same under 27101920,in respect of the impugned goods imported vide Bill of Entry No.9391372 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 p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8.2020, the assessments made under section 17 of the Customs Act, 1962 has attained finality with respect to the declared classification vis- -vis the declared description of the goods. (ii) The Hon ble Supreme Court in case of Escorts Limited v. Union of India and Others reported in 1998 (97) ELT 2011 (SC), held that a conjoint reading of section 47 and section 17 of the Customs Act, 1962 reveals that the classification of the imported goods and payment of duty thereon based on the assessment made by the Proper Officer amounts to passing of an assessment order. Hence, it cannot be altered without any appeal. (iii) In the case of ITC Limited v. Commisioner, reported in 2019(368)ELT 2016(SC), it has been held by the Hon ble Supreme 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 compo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st report and interpreted the CRCL test report according to their convenience, even though the test report has not categorically indicated that the samples tested were Solvent 125/240. 15. The Respondent cited the decision of the Tribunal in the case of Krishna Technochem Pvt Ltd, which has been upheld by the Hon ble Supreme Court wherein it has been observed that the word used in Note 4 of chapter 27 is at and not upto . This would mean that the minimum IBP and maximum FBP should be exactly 125 and 240 for classification of the said goods as solvent 125/240 under 27101920. In the present case the IFP of 148 and FBP of 218 are nowhere closer to the IS 1735 standards. Accordingly, they argued that the impugned goods cannot be classified under 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 L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods is 148 degree Celsius and FBP is 218 degree Celsius, whereas as per the IS standard 1745 the minimum IFB should be 125 degree Celsius (IBP) and maximum FBP should be 240 degree Celsius respectively. The Respondent stated that the IFB 148 of the impugned goods is much higher than the minimum IFB requirement of 125 as per the IS 1745 standard. Also the FBP 218 of the impugned goods as per the Test Report is much lower than than the maximum FBP requirement of 240, as per IS 1735 standards. The Respondent also stated that the flash point 41 for the impugned goods as per the Test Report is much higher than the requirement of 30 flash point as per IS 1745 standards. Thus, they argued that none of the above parameters in the Test Report are matching with the requirements as per IS 1745 standards for classifying the goods as Light Oils and preparations under CTH 2710. 22. The Respondent cited the decision of the Tribunal, in the case of Krishna Technochem Pvt Ltd Vs CCE, Haldia, vide Final Order No 77087-77089 dt.25.09.2019 (Excise Appeal No.238 of 2010 Excise Appeal No.76038 of 2014), wherein the applicability of Note 4 to Chapter 27 has been examined. The relevant portion of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeals are, accordingly, dismissed. 23. In view of the above decision, the Respondent stated that when the Test Reports differs from the standards prescribed, the goods cannot be held to satisfy the requirements under IS 1745 standards meant for CTH 2710. Hence the impugned goods cannot be categorized as Light Oils and Preparations as per the CRCL Test report. We find merit in the argument of the Respondent. None of the above said parameters are matching with the minimum or maximum standards fixed as per IS 1745 standards. There is a vast difference between the minimum IFB and maximum FBP fixed as per IS standard 1745 and the result received for the impugned goods. Hence, the impugned goods cannot be classified under chapter sub heading 27101920, on the basis of the parameters available in the CRCL, Test Report dated 26.11.2020. 24. We find that Revenue has relied upon the Note 4 to Chapter 27 for classifying the impugned goods under the CTH 27101920. For the sake of ready reference the said Note 4 is reproduced below: Note 4. For the purposes of sub-heading 2710 12, light oils and preparations are those of which 90% or more by volume (including losses) distil a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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