Prefabricated building tariff note applies only to built-in items; excessive redemption fine was reduced.

The tariff note for prefabricated buildings under Chapter 94 was applied only to finished or site-assembled buildings and to items normally supplied as built-in or fitted equipment, such as air-conditioning and certain kitchen fittings; loose furniture like cots, tables and chairs was excluded, so classification was accepted only to that limited extent. The redemption fine on confiscation was found excessive in light of the importer's own use and the proper scope of the note, so it was reduced from Rs. 30 lakhs to Rs. 5 lakhs. Confiscation and the remainder of the order were maintained.

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Issues: (i) Whether the imported portacabins and their associated items were covered by the tariff note for prefabricated buildings under Chapter 94 and could be classified accordingly; (ii) whether the redemption fine imposed on confiscation required reduction.

Issue (i): Whether the imported portacabins and their associated items were covered by the tariff note for prefabricated buildings under Chapter 94 and could be classified accordingly.

Analysis: The interpretative note for prefabricated buildings covers buildings finished in the factory or assembled on site and extends to items normally supplied as built-in equipment, including air-conditioning and certain kitchen equipment. It does not, however, extend to loose furniture such as cots, tables and chairs, or to all items merely because they are imported along with the cabins. On that basis, only those items that are fitted or normally built in could be brought within the note.

Conclusion: The coverage under the tariff note was accepted only to the limited extent indicated above and was not available for all the imported items.

Issue (ii): Whether the redemption fine imposed on confiscation required reduction.

Analysis: The import was for the importer's own use, and the broad interpretation adopted by the Commissioner was found unsustainable. In view of the nature of the goods and the extent to which some items were capable of falling within the note, the fine was considered excessive.

Conclusion: The redemption fine was reduced from Rs. 30 lakhs to Rs. 5 lakhs.

Final Conclusion: The appeal succeeded only to the extent of reduction in redemption fine, while the confiscation and the remainder of the order were maintained.

Ratio Decidendi: An interpretative tariff note covering prefabricated buildings extends only to equipment normally supplied as built-in or fitted components, and excessive redemption fine may be reduced where the importer's use and the proper scope of the note justify moderation.

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