Aureole Inspecs India Pvt. Ltd. Vs Principal Commissioner (CESTAT Delhi)
CESTAT Delhi held that goods imported are snow goggles and not sunglasses. Accordingly, the goods i.e. snow goggles are classifiable under residual CTH 90049090 as others and cannot fall under CTH 90041000 as sun glasses.
Facts- The appellant imported snow goggles which it supplied to the Indian Army as per its contract dated 31 August 2018 to supply 79,245 Snow Goggles. The appellant filed Bill of Entry dated 21.9.2019 to clear the snow goggles classifying them under Customs Tariff Heading 90049090 which attracts basic customs duty at the rate of 10%. Revenue felt that they were classifiable under CTH 90041000 attracting BCD of 20%. The Principal Commissioner of Customs issued a Show Cause Notice which culminated in the impugned order.
Conclusion- Held that they are not sunglasses but are Snow Goggles. Therefore, the disputed goods cannot fall under 90041000 (sun glasses) and must fall under 900490 ‘Other’. This heading covers three types of goods viz., passive night vision goggles, prismatic eye glasses for reading and others. Night vision goggles enable the viewer to see in the dark by converting the infra red rays which are emitted by all objects even in the dark, into visible light. Prismatic eye glasses are meant for reading correcting the vision. The imported goods do not fall under either of these categories. Hence, they were correctly classified by the importer under the residual CTH 90049090 as others.
FULL TEXT OF THE CESTAT DELHI ORDER
M/s. Aureole Inspecs India Pvt. Ltd.1 filed this appeal to assail the Order-in- Original2 dated 18 August 2020 passed by the Principal Commissioner of Customs Air cargo complex (Import), New Delhi. The appellant imported snow goggles which it supplied to the Indian Army as per its contract dated 31 August 2018 to supply 79,245 Snow Goggles. The appellant filed Bill of Entry dated 21.9.2019 to clear the snow goggles classifying them under Customs Tariff Heading3 90049090 which attracts basic customs duty4 at the rate of 10%. Revenue felt that they were classifiable under CTH 90041000 attracting BCD of 20%. The Principal Commissioner of Customs issued a Show Cause Notice5 dated 28.2.2020 which culminated in the impugned order the operative part of which is as follows:
ORDER
(i) I reject the claim seeking classification of the imported goods namely ‘Snow Goggles’ under CTH 90049090 and order that the goods be reclassified under CTH 90041000 for which Bills of Entry were filed / presented by M/s Aureole Inspecs (India) Pvt. Ltd.
(ii) I hereby confirm the demand of Customs duty and IGST to the tune of Rs. 51,58,683/- (Rupees Fifty One Lakh Fifty Eight Thousand Six Hundred and Eighty Three only) on the import and clearance of ‘Snow Goggles’ made by M/s Aureole Inspecs (India) Pvt. Ltd. against the three Bills of Entry as listed in tabular form under para 2 of the SCN under Section 28(1) of the Customs Act, 1962.
(iii) I hold that interest under Section 28AA of the Customs Act, 1962 is payable in this case by M/s Aureole Inspecs (India) Pvt. Ltd. from the due date till the duty is paid in accordance with law.
(iv) I hold that the goods imported and already cleared M/s Aureole Inspecs (India) Pvt. Ltd. against the three Bills of Entry as listed in tabular form under para 2 of the show cause notice totally valued at Rs. 3,97,43,313/- (Rupees Three Crore Ninety Seven Lakh Forty Three Thousand Three Hundred and Thirteen only) liable for confiscation under Section 111 (m) of the Customs Act, 1962. Since, the goods have already been cleared and are not seized, therefore, I refrain from imposing any Redemption Fine upon M/s Aureole Inspecs (India) Pvt. Ltd. under Section 125(1) of the Customs Act, 1962.
(v) I also impose penalty of Rs. 5.15,850/- (Rupees Five Lakh Fifteen Thousand Eight Hundred and Fifty only) upon M/s Aureole Inspecs (India) Pvt. Ltd. under Section 112(a) of the Customs Act, 1962.
2. Aggrieved, the appellant filed this appeal.
Submissions on behalf of the appellant
3. The adjudicating authority erred in holding that snow goggles were classifiable under 90041000 because the heading pertains to ‘sun glasses’ which are different from the ‘snow goggles’ imported by it which are classifiable under 90049090.
4. Snow Goggles is a more specific description of the goods and should prevail over the more general description of ‘sun glasses’ as per Rule 3(a) of the General Rules for Interpretation of Tariff 6.
5. The adjudicating authority erred in holding that Sun glasses and Snow Goggles are one and the same for the reason that both are meant for protecting the eyes.
6. The goods should be classified as they are known to the end-users/customers. The contract which the appellant received was for ‘Snow Goggles’ and all the specifications in the contract are for ‘Snow Goggles’ and nothing in the entire contract shows that they are sun glasses. The relevant portion of the contract are as follows:
1. Clause No. 1.0 of specification for Snow Goggles:-
Scope- “This specification covers Qualitative and other requirement for supply of snow goggles, Cat. Pt. No.- NIV, which are used for protection of eye in snowy region”.
2. Clause No. 16.2.1 of specification for Snow Goggles:-
Recommendations for use:- “These high altitude snow goggles are designed to provide protection against snow, sun, wind and cold conditions. Not recommended for use when driving. Ensure that air can freely circulate around the ventilation holes, which are specially developed to allow water droplets to evaporate. This will prevent any condensation from impairing your vision. To ensure a perfect individual fit use the head strap slide adjustor.
3. Clause No. 5.2.2 of specification for snow Goggles:-
Lens: The lens shall also be suitably coated to offer protection against effects of fog/frost.
7. Sun glasses protect the eyes from bright sunlight while Snow Goggles are meant for use in high altitudes where the risk of exposure to Ultra-violet rays is very high. The specific differences between the two are as below:
