2013 (9) TMI 621 - AT - Customs

Tribunal Classifies Cut Rails under Customs Tariff Heading 7204, Upholds Circular Validity

The Tribunal classified cut pieces of rails under Customs Tariff Heading 7204, rejecting mis-declaration claims. It emphasized HSN Notes' non-binding ... Application for rectification of mistake – Held that:- The application for rectification of mistake was rejected except for minor editorial change of the order - Loyds Steel Industries Ltd. Vs CC (2006 (7) TMI 509 - CESTAT, MUMBAI) - there was no merit in the argument of Revenue that this was a case of mis-declaration of description of goods - Such case had to be examined if the Tribunal had come to a conclusion that the goods cannot be considered as melting scrap - there was no error apparent on record to be rectified – decided against the revenue. Issues involved:Classification of goods under Customs Tariff Headings, Mis-declaration of goods, Interpretation of HSN Notes, Validity of Circulars issued by CBEC, Consideration of past decisions, Rectification of errors apparent on record.Classification of Goods under Customs Tariff Headings:The main issue in dispute was whether cut pieces of rails of length less than 2 meters should be classified under Customs Tariff Heading 7204 or 7302. The final order classified the goods under Heading 7204. The Tribunal considered arguments regarding HSN Notes, Circular 8/2006-Cus, and Section Note 8 (n) of the Customs Tariff. The Tribunal analyzed past decisions and the issue of consistency in classification. The Tribunal held that the goods were not to be considered as melting scrap and that mis-declaration was not sustainable.Mis-declaration of Goods:The Revenue argued that there was mis-declaration of goods as heavy melting scrap instead of cut used rails. The Tribunal examined the issue of mis-declaration and found that it was not applicable as the goods were not classified as melting scrap. The Tribunal considered the history of classification and decisions by DGFT and Customs authorities to determine the classification of the goods.Interpretation of HSN Notes:The Tribunal discussed the reliance on HSN Notes for the interpretation of the Customs Tariff. It considered various facts, judicial decisions, and arguments to determine the classification of the goods. The Tribunal found that the HSN Notes did not have binding force and that the goods in question were not to be classified as melting scrap based on the evidence presented.Validity of Circulars issued by CBEC:The Revenue argued that Circular 8/2006-Cus had been struck down by the High Courts and the Supreme Court, and the Tribunal's reliance on it was incorrect. The Tribunal analyzed the decisions of the courts and found that the Circulars could be considered as guidance but did not have a binding effect. The Tribunal concluded that there was no error in considering the Circular in the decision-making process.Consideration of Past Decisions:The Tribunal examined various past decisions by higher courts and the Tribunal itself to maintain consistency in classification. The Tribunal found that the past decisions supported the classification of the goods under Heading 7204 and upheld its decision based on the evidence and arguments presented.Rectification of Errors Apparent on Record:The Revenue sought rectification of mistakes apparent on record, including the Tribunal's findings on mis-declaration, interpretation of HSN Notes, and reliance on Circulars. The Tribunal rejected the application for rectification, except for a minor editorial change in a factual statement, as it did not impact the conclusion reached by the Tribunal.This detailed analysis of the judgment highlights the key issues involved in the classification of goods under Customs Tariff Headings and the Tribunal's thorough examination of the arguments presented by both parties.