Kunjal Synergies Private Limited Vs Commissioner of Customs (CESTAT Kolkata)
CESTAT Kolkata held that Low Aromatic White Spirit is rightly classifiable under the CTH 27101990 and not classifiable as ‘Light Oil and Preparations’ under CTH 27101239
Facts- The Appellant imported the goods with the description “Low Aromatic White Spirit” and filed two Bills of Entry for warehousing, classifying the goods under the CTH 2710 1990.
The Joint Commissioner of Customs (Port), SIB, Custom House, Kolkata issued a SCN dated 30.06.2021 proposing to reclassify the goods under 27101239. The Notice was adjudicated and the adjudicating authority vide his order dated 24/02/2022 rejected the declared description of the goods “White Spirit in bulk” and re-determined the same as “Solvent 145/205 as per IS 1745:2018”. He allowed re-export of the goods imported vide the above said Warehousing Bills of Entry, upon payment of Redemption Fine. He also imposed penalty on the Appellant.
The Appellant filed an appeal before the Commissioner (Appeals), who allowed the appeal of the Appellant vide his Order-in-Appeal dated 10/06/2022 and held the classification of the goods under Customs Tariff 27101239 as erroneous and set aside the Order-in-Original and remitted the matter back to the adjudicating authority for proper assessment of the goods. Aggrieved by the Impugned Order, the Appellant is before us.
Conclusion- Held that in the impugned order, the Commissioner (Appeals) has rejected the Classification of the goods under CTH 27101239. When the goods do not satisfy the criteria fixed under Note 4 of Chapter 27, the goods cannot be classified under CTH 27101239. The remaining option available in the Tariff is to classify the same under CTH 27101990 which is the only residuary entry available for classification. Regarding the remaining 4 Bills of Entry, as discussed above the Test Reports of CRCL Kolkata does not provide any material evidence for classification of the said goods under CTH 27101239. Since the said goods are rightly classifiable under the CTH 27101990, the classification adopted by the Appellant is in order and hence the goods are not liable for confiscation.
FULL TEXT OF THE JUDGMENT/ORDER OF KOLKATA HIGH COURT
The Appellant imported the goods with the description “Low Aromatic White Spirit” and filed two Bills of Entry for warehousing, classifying the goods under the CTH 2710 1990. Four Ex Bond Bills of Entry filed by the Appellant earlier have already been assessed and warehoused. An Alert Circular 02/2020 dated 23/03/2020 issued by DRI, New Delhi indicated that some importers are importing Low Aromatic White Spirit classifiable under CTH 271012, as per Chapter Note 4 of Chapter 27 and misclassifying the same to violate the provisions of Import Policy. Accordingly, SIB, Kolkata Customs has initiated investigation against the Appellant and detained the said goods imported by the Appellant. Samples were drawn and on the basis of the Test Reports received from CRCL, Kolkata, the Department rejected the classification of 271990 sought by the Appellant and proposed to reclassify the same under the CTH 27101239 as „Solvent 145/205 as per IS 1745:2018‟.
2. The Joint Commissioner of Customs (Port), SIB, Custom House, Kolkata issued a SCN dated 30.06.2021 proposing to reclassify the goods under 27101239. The Notice was adjudicated and the adjudicating authority vide his order dated 24/02/2022 rejected the declared description of the goods “White Spirit in bulk” and re-determined the same as “Solvent 145/205 as per IS 1745:2018”. He allowed re-export of the goods imported vide the above said Warehousing Bills of Entry, upon payment of Redemption Fine. He also imposed penalty on the Appellant. The Appellant filed an appeal before the Commissioner (Appeals), who allowed the appeal of the Appellant vide his Order-in-Appeal dated 10/06/2022 and held the classification of the goods under Customs Tariff 27101239 as erroneous and set aside the Order-in-Original and remitted the matter back to the adjudicating authority for proper assessment of the goods. Aggrieved by the Impugned Order, the Appellant is before us.
3. Samples of the impugned goods were drawn and sent to CRCL, Kolkata vide Test Memo Nos. 1080019 dated 13.01.2021 and 1080026 dated 13.01.2021, with a request to specify the following parameters:
(i) Colour
(ii) Density at 15 C
(iii) Viscosity
(iv) Flash Point (Abel)
(v) Class of Petroleum Product (A, B or C)
(vi) Distillation Range i.e. Initial Boiling Point and Final Boiling Point
(vii) Whether 90% or more by volume (including losses) distils at 210 C according to the ISO 3405 method (equivalent to the ASTM D 86 Method)?
(viii) Whether samples meet the criteria of “Light Oil and its preparations”?
(ix) Percentage of Aromatic Contents
(x) Specific Chemical name or class of Hydrocarbon along with CAS number
(xi) Any other specification/remarks.
4. In response to the above queries vide the aforementioned TM No. 1080019 dated 13.01.2021, the Chemical Examiner Gr-I, CRCL, Kolkata has submitted the following Report dated 28.01.2021:
CRCL Test Report: “Received two sample bottles marked as A & B wrapped with cello tape and cloth, Each of the two samples is in the form of clear colourless liquid composed of Mixed of Mineral Hydrocarbon Oil (more than 70% by it) having following constants:
