Anabond Limited Vs Commissioner of Customs (Import) (CESTAT Chennai)
CESTAT Chennai held that collection of CVD on basis of retail sale price in terms of Notification No. 49/2008-C.E.(N.T.) dated 24.12.2008 issued under Section 4A of the Central Excise Act, 1944 in case of prepared glues and other prepared adhesives justified.
Facts- The appellant had imported various items such as Rust Penetrant, Chain Lubricant, Mega Check Cleaner, Adhesive, Mega Check Penetrant, Paint Remover, out of which the first four items were assessed to CVD on the basis of retail sale price and the balance two items were assessed on the basis of transaction value. With regard to the fourth item, namely, adhesive (Power Bond A1), which was classified under CTH 3506 1000, the assessment of CVD was done on the basis of retail sale price and not on the transaction value.
It appears that subsequently, the appellant ascertained that they were not liable to pay CVD based on retail sale price for the said product falling under CTH 3506 1000. As such, they preferred an appeal before the lower appellate authority, who rejected the appeal of the appellant. Aggrieved by the above, the appellant preferred the above captioned appeal before the forum.
Conclusion- A constructive reading of Chapter Heading 3506 along with the Notification No. 49/2008-C.E.(N.T.) dated 24.12.2008 makes it clear that it covers all prepared glues and other prepared adhesives, not elsewhere specified or included, including products that are suitable for use as glues or adhesives, put up for retail sale as glues or adhesives, not exceeding a net weight of 1kg. To our mind, as the imported goods are classified under CTH 3506 1000, which is not disputed and which covers products put up for retail sale whose net weight does not exceed 1 kg., should be treated as included for the purpose of the impugned Notification No. 49/2008-C.E.(N.T.) dated 24.12.2008 for subjecting the goods to retail sale price based levy.
Taking a stand that the prepared glues and other prepared adhesives, not elsewhere specified or included, are included in the said Notification, as given therein, and would not include the same products put up for retail sale whose net weight is not exceeding 1 kg., is not legally correct.
In view of the above, we do not find any reason to differ with the decision of the lower appellate authority on the issue of including the imported adhesives for the purpose of collection of CVD on the basis of retail sale price in terms of Notification No. 49/2008-C.E.(N.T.) dated 24.12.2008 issued under Section 4A of the Central Excise Act, 1944.
FULL TEXT OF THE CESTAT CHENNAI ORDER
M/s. Anabond Limited, Tiruporur, Kancheepuram District, the appellant herein, has filed this appeal against the Order-in-Appeal C.Cus. No. 298/2013 dated 28.02.2013 passed by the Commissioner of Customs (Appeals), Custom House, Chennai, who rejected their appeal holding that the assessment done under CTH 3506 1000 for collection of CVD in terms of Notification No. 49/2008-C.E.(N.T.) dated 24.12.2008 was in order, wherein the goods were assessed to CVD based on the retail sale price.
2. Facts in brief in this appeal are that the appellant had imported various items such as Rust Penetrant, Chain Lubricant, Mega Check Cleaner, Adhesive, Mega Check Penetrant, Paint Remover, vide Bill-of-Entry No. 607473 dated 25.08.2010, out of which the first four items were assessed to CVD on the basis of retail sale price and the balance two items were assessed on the basis of transaction value. With regard to the fourth item, namely, adhesive (Power Bond A1), which was classified under CTH 3506 1000, the assessment of CVD was done on the basis of retail sale price and not on the transaction value.
3. It appears that subsequently, the appellant ascertained that they were not liable to pay CVD based on retail sale price for the said product falling under CTH 3506 1000. As such, they preferred an appeal before the lower appellate authority, who vide his impugned Order-in-Appeal No. 298/2013 dated 28.02.2013 rejected the appeal of the appellant. Aggrieved by the above Order-in-Appeal, the appellant preferred the above captioned appeal before this forum.
4. It was submitted by the appellant that levy of CVD on import of goods is made in terms of Section 3 of the Customs Tariff Act, 1975 and the first proviso to subsection (2) of the said Section mandated that in respect of articles notified under sub-section (1) of Section 4A of the Central Excise Act, the retail sale price was required to be declared on the packages of the imported goods, under the Standards of Weights and Measures Act, 1976 or the rules made thereunder or under any law for the time being in force, to declare on the package thereof the retail sale price of such article; and the value of the imported article shall be deemed to be the retail sale price declared on the imported article less such amount of abatement as allowed under sub-section (2) of Section 4A of the Act for the purpose of such levy of CVD.
5. Notification No. 49/2008-C.E.(N.T.) dated 24.12.2008 issued under sub-sections (1) and (2) of Section 4A of the Central Excise Act, 1944 notifies the following goods under Chapter Heading 3506 at Sl. No. 43 with an abatement of 35%.
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