2018 (11) TMI 1724 - AT - Customs

Tribunal Upholds Decision on Duty Rate for Nylon Yarns

The Tribunal upheld the decision of the learned Commissioner (Appeals) in favor of the respondent, allowing the concessional rate of duty for imported ... Benefit of concessional rate of duty - Import of N-6 Tire Cord Grade Spin Drawn Filament / Nylon-6 High tenacity Nylon Filament yarn - N/N. 5/2006-C.E., dated 01.03.2006 as amended by No. 58/2008-C.E., dated 07.12.2008 - HELD THAT:- The aforesaid notifications grant concessional rate of duty of 4% in respect of all goods, other than nylon filament yarn of 210 deniers or in the multiples thereof, with tolerance of 6% - The issue is not in dispute that the imported nylon yarns are not of 210 deniers and thus, by referring to the definition of the said goods as per the HSN, the benefit of concessional rate of duty was extended by the learned Commissioner (Appeals) in favour of the respondent. The subject goods should merit for concessional rate of duty of 4% - Furthermore, Revenue has not submitted any record to show that the order dated 26.08.2008 passed by the learned Commissioner of Customs (Appeals), Cochin (supra) has been appealed against and operation of such order has been stayed or overruled by the higher judicial forums. Appeal dismissed - decided against Revenue. Issues:1. Interpretation of Notification No. 5/2006-C.E. for concessional rate of duty.2. Classification of imported nylon yarns for duty calculation.3. Application of arithmetic formula for classification of goods.4. Compliance with Higher Judicial Forum's orders.Analysis:1. Interpretation of Notification No. 5/2006-C.E.: The case involved the interpretation of Notification No. 5/2006-C.E. for the concessional rate of duty. The appellant had imported nylon yarns and claimed the benefit under this notification. The adjudicating authority initially rejected the claim, but the learned Commissioner (Appeals) allowed the appeal in favor of the respondent, extending the benefit of concessional rate of duty based on the HSN definition of the goods.2. Classification of imported nylon yarns: The imported nylon yarns were of 840/1260/1680 deniers, which did not match the 210 deniers specified in the notification for concessional duty. The issue revolved around whether the imported goods qualified for the concessional rate of duty under the notification. The Tribunal found that the goods did not meet the specified denier criteria but were still eligible for the concessional rate based on the HSN definition.3. Application of arithmetic formula for classification: The learned Commissioner (Appeals) based the decision on not adopting an arithmetic formula for determining multiples for classification of goods under a different chapter than claimed by the respondent. This decision was supported by a previous order in a similar case. The Tribunal agreed with this approach and upheld the decision, emphasizing that the Revenue did not provide substantial arguments against the concessional rate of duty claimed by the respondent.4. Compliance with Higher Judicial Forum's orders: The Tribunal noted that the Revenue did not present any evidence to show that a previous order by the Commissioner of Customs (Appeals) had been challenged or overruled by higher judicial forums. As a result, the Tribunal found no reason to overturn the decision of the learned Commissioner (Appeals) and dismissed the appeal filed by the Revenue, affirming the concessional rate of duty for the imported goods.In conclusion, the Tribunal upheld the decision of the learned Commissioner (Appeals) in favor of the respondent, allowing the concessional rate of duty for the imported nylon yarns based on the HSN definition and rejecting the Revenue's appeal due to lack of substantial arguments and compliance with higher judicial forum orders.