2007 (7) TMI 124 - AT - Customs

Goods reclassified under Heading 59.03 due to coating visibility, overturning original classification under Heading 54.07.

The goods were classified under Heading 59.03 based on the visibility of the coating to the naked eye, overturning the Department's classification under ... Classification –Appellant contended the imported impugned goods(Nylon fabrics coated with Polyurethane) classifiable under heading 59.03 but as per department classifiable under heading 54.07 – Tribunal allowed the appellant claim and set aside demand, fine and penalty Issues: Classification of imported goods under Heading 59.03 or 54.07 based on visibility of coating to the naked eye.In this case, the appellants imported goods claiming them to be Nylon Fabrics coated with Polyurethane, arguing for classification under Heading 59.03 due to the visible coating. However, the Department classified the goods under Heading 54.07, contending that the coating was not visible to the naked eye. The appellants presented reports from the Custom House Chemical Examiner and the Joint Director, CRCL supporting their claim, while the Department relied on a report from the Assistant Director of the Textile Committee. The Tribunal directed the Joint Director, CRCL, and the Additional Director of the Textile Committee to provide further clarification. The Joint Director explained the testing process, highlighting that the coating was visible to the naked eye after dissolution in Hcl solution. The Tribunal found the testing conducted by CRCL to be reliable and accepted the visibility of the coating, classifying the goods under Heading 59.03. Consequently, the impugned order, duty-demand, fine, and penalty were set aside, granting relief to the appellants. The appeal was allowed based on the Tribunal's findings and conclusions.