2014 (8) TMI 998 - AT - Customs

Tribunal rules in favor of appellant in customs dispute over polyester ladies stole classification.

The Tribunal ruled in favor of the appellant in a customs classification dispute regarding imported goods initially declared as Polyester Ladies Stole. ... Classification of goods - Classification under Heading 62143000 or under CTH 62149060 - Held that:- Goods in question were no doubt made of synthetic fibre. But there is no evidence to show whether the goods were made out of manmade fibre to bring the same under 62149060. There may be possibility that synthetic fibre may be falling under heading manmade fibre but to establish the same an enquiry should have been done by Revenue. That has not been done. Burden of proof not being discharged by the Revenue. It is difficult to agree with the contention of Revenue that the goods fall under Heading 62149060. - once misdeclaration of the description of goods is not established, there is no scope to make allegation of misdeclaration of value against the appellant. - Decided in favour of assessee. Issues: Classification of imported goods under Customs Tariff Heading (CTH) 62149060, Burden of proof on Revenue, Misdeclaration of goods and value.Classification Issue:The goods initially declared as Polyester Ladies Stole under Heading 61171090 were later classified under Heading 62143000. The dispute arose as the Revenue argued that the goods fell under CTH 62149060, encompassing manmade and synthetic fibers. However, the appellant contended that the goods should be classified under Heading 6214 for synthetic fiber products. The Tribunal noted that without concrete evidence or an inquiry establishing the presence of manmade fiber, the goods could not be presumed to fall under CTH 62149060. The Tribunal emphasized the importance of proper classification based on evidence and dismissed the Revenue's argument, ruling in favor of the appellant.Burden of Proof Issue:The Revenue supported the classification under CTH 62149060 by asserting that manmade fiber falls under the category of synthetic fiber, thus denying the appellant the benefit of Tariff Entry 6214. However, the Tribunal highlighted that while the goods were indeed made of synthetic fiber, there was a lack of evidence to prove the presence of manmade fiber. The Tribunal emphasized that without a proper inquiry or evidence establishing the composition of the goods, the burden of proof was not discharged by the Revenue. Consequently, the Tribunal rejected the Revenue's argument and ruled in favor of the appellant due to the lack of conclusive evidence.Misdeclaration Issue:The Tribunal clarified that in the absence of establishing misdeclaration of the goods' description, there was no basis to allege misdeclaration of value against the appellant. By emphasizing the importance of accurate classification and the lack of evidence supporting the Revenue's claims, the Tribunal concluded that all appeals were allowed in favor of the appellant. The judgment highlighted the significance of proper evidence and burden of proof in customs classification disputes, ultimately leading to a favorable outcome for the appellant.This detailed analysis of the judgment from the Appellate Tribunal CESTAT New Delhi underscores the critical legal issues surrounding the classification of imported goods, burden of proof on Revenue, and allegations of misdeclaration, providing a comprehensive understanding of the Tribunal's decision and reasoning in this case.