Customs classification of polyester bonded fabrics remanded for fresh adjudication after later circular on textile classification.

Classification of imported polyester bonded fabrics was reconsidered in light of a later customs circular on textile classification, because the original adjudication had not examined the dispute against those guidelines. The competing entries concerned Chapters 54 and 55, while the appellate view had proceeded on Chapter 59; however, the circular issued later set out relevant criteria based on the textile material and the nature of bonding. As Chapter 59 was not among the original competing entries and the adjudicating authority had no occasion to assess the matter under the circular, a fresh examination was required. The impugned order was set aside and the matter remanded for de novo adjudication with an opportunity of hearing and observance of natural justice.

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Issues: Whether the impugned order classifying the imported polyester bonded fabrics under Chapter 59 was liable to be set aside and the matter remanded for fresh adjudication in the light of the later Board circular.

Analysis: The dispute concerned the correct classification of polyester bonded fabrics, with the competing claims being under Chapters 54 or 55, while the appellate authority had accepted classification under Chapter 59. The Board's Circular No. 2/2011-Cus dated 04.01.2011, which set out guidelines for classification depending on the type of textile material and the nature of bonding, was issued subsequent to the impugned order and had not been considered by the original adjudicating authority. Since Chapter 59 was not one of the original competing entries and the adjudicating authority had no occasion to examine the issue in the light of the circular, a fresh decision by that authority was considered necessary.

Conclusion: The impugned order was set aside and the matter was remanded to the original adjudicating authority for de novo adjudication, with an opportunity to the importers to present their case and with natural justice to be followed.

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