JSW Steel Ltd. Vs Commissioner of Customs (CESTAT Chennai)
The appeal arose from an order passed by the Commissioner of Customs denying exemption under Notification No. 21/2002-Cus (as amended) in respect of imported coking coal under one Bill of Entry and confirming a differential duty demand of Rs. 1,06,43,194/- along with interest, while dropping proceedings for five other consignments. The importer, engaged in the manufacture of iron and steel, had imported Hard Coking Coal from Australia through six Bills of Entry between August 2011 and March 2012 and claimed exemption under the notification. The goods were provisionally assessed pending test reports.
Samples were tested by the Chemical Examiner, who reported Crucible Swelling Number (CSN) above 1 but did not report Mean Reflectance (MR) due to lack of facility. The provisional assessments were finalized by accepting classification as coking coal and granting exemption based on CSN from the Customs laboratory and MR values from load port surveyor certificates. Subsequently, a Show Cause Notice dated 13.06.2013 proposed denial of exemption for all consignments on the grounds that MR was not determined by a competent laboratory and that CSN values in load port reports were unreliable.
After issuance of the notice, remnant samples were sent to the Central Institute of Mining and Fuel Research (CIMFR), which reported MR of 1.59 and CSN of 0.5 for one Bill of Entry. Relying on this report, the adjudicating authority denied exemption only for that consignment while dropping proceedings for others. The importer challenged the order before the Tribunal, contending that reliance on the CIMFR report was beyond the scope of the Show Cause Notice and that contemporaneous evidence established compliance with exemption conditions.
