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of <h1>Tribunal upholds reclassification of imported goods as 'Animal Feed Supplement,' imposes fines for customs duty evasion.</h1> <h3>Commissioner of Customs (Imports), Chennai Versus Alpharma (Belgium) BVBA</h3> The Tribunal upheld the reclassification of imported goods as 'Animal Feed Supplement,' rejecting the cross objection on classification. Confiscation of ... Claim of exemption from CVD - Import of Chlortetracycline 15% (Medicaments) - Animal Feed Supplements - Classification - Notification No.3/2005-c.Ex (Sl.No.29) dt. 24.2.2005. - Revenue's appeal is limited to confiscation and imposition of fine and penalty which was set aside by the Commissioner (Appeals) - Held that:- On perusal of OIO, we find that in spite of several opportunities were given to the respondent to appear for personal hearing, the respondent to appear for hearing to defend their case and the having accepted the classification before Commissioner (Appeals) we do not find any merit in the respondents contention on classification of imported goods in their cross objection. We also find that the adjudicating authority and the appellate authority have discussed the classification issue at length and rightly held that the goods are “Animal Feed Supplement” and classifiable under Chapter 23 of CTA. Therefore, the cross objection on their issue is liable to be rejected. Nowhere in the invoice the goods were described as “Medicaments” but they have added and inserted the words “medicaments” while describing the description of the goods in the B/E and claimed classification under Chapter 30 to evade payment of appropriate duty of customs. It is evident that respondents claimed classification of goods as “medicament” under Chapter 30 with intention to avail exemption of CVD at NIL rate under Central Excise notification No.3/2005-C.Ex Sl.No.29). Therefore, intention of the respondent is established the contravention under Section 111 for confiscation is fully justified. Demand of duty confirmed - however redemption fine and penalty reduced - Decided partly in favor of Revenue. Issues:Classification of imported goods, Confiscation of goods, Imposition of redemption fine and penaltyClassification of Imported Goods:The case involved the misdeclaration of goods imported as 'Chlortetracycline 15%' under Chapter Heading 30042041 instead of 'animal feed supplements.' The adjudicating authority reclassified the goods under Chapter Heading 23099090 as Animal Feed Supplement, demanding differential duty for past clearances. The Commissioner (Appeals) partly allowed the appeal, upholding the reclassification but setting aside confiscation and penalty. The Revenue appealed against the setting aside of confiscation and penalty, while the respondents filed a cross objection. The Tribunal found that the respondents had accepted the reclassification before the Commissioner (Appeals) and upheld the classification as 'Animal Feed Supplement.' The contention on classification in the cross objection was rejected.Confiscation of Goods:The Revenue contended that the misdeclaration of goods was intentional to evade customs duty, supported by evidence of deliberate misdescription in the B/E to claim exemption. The Tribunal found that the intention to evade duty was established, justifying confiscation under Section 111 (m) of the Customs Act. The adjudicating authority's order of confiscation was upheld, setting aside the Commissioner (Appeals) decision to drop the confiscation.Imposition of Redemption Fine and Penalty:Regarding the redemption fine and penalty, the Tribunal noted discrepancies in the imposition of a fine of &8377;50 lakhs covering past consignments valued at &8377;2,09,17,181, which were cleared on provisional assessment basis. The Tribunal reduced the redemption fine to &8377;1,00,000 and the penalty to &8377;50,000, considering the facts and circumstances. The decision modified the adjudication order, setting aside the setting aside of confiscation, redemption fine, and penalty. The Revenue's appeal was partly allowed in the specified terms, and the cross objection was disposed of accordingly.This detailed analysis covers the issues of classification of imported goods, confiscation of goods, and the imposition of redemption fine and penalty, as addressed in the appellate tribunal's judgment.
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