Burden of proof in customs classification defeats reliance on a partial test report to deny exemption

Imported fuel declared as marine gas oil could not be reclassified as high speed diesel on the basis of a test report covering only four common parameters. The report did not establish that all conditions for high speed diesel classification were met or disprove the importer's declared description. Applying the principle that the party asserting a contrary classification must prove it with adequate evidence, the revenue failed to discharge its burden. The denial of exemption and confirmation of differential duty were therefore unsustainable, and the assessee obtained relief on classification and duty.

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Issues: Whether the imported fuel on board the rig and vessels was marine gas oil or high speed diesel, and whether the department could deny exemption and confirm duty on the basis of a test report testing only a few common parameters.

Analysis: The fuel was declared as marine gas oil, while the laboratory report recorded only four parameters and stated that the sample had the characteristics of high speed diesel. The report did not establish that all the conditions necessary for classification as high speed diesel were satisfied, nor did it negate the claim that the product was marine gas oil. The issue had already been decided in the assessee's own case, and the principle that the party asserting a contrary classification must prove it applied. On the evidence available, the department failed to discharge that burden, especially when the tested parameters were common to both products.

Conclusion: The imported fuel was held to be marine gas oil as claimed by the assessee, and the denial of exemption and confirmation of differential duty were unsustainable.

Final Conclusion: The appeals succeeded and the impugned orders were set aside, resulting in relief to the assessee on classification and duty.

Ratio Decidendi: Where a revenue authority seeks to displace the importer's declared classification, it must prove the contrary classification by adequate and complete evidence; a partial test report covering only common parameters is insufficient to reject the declared commodity.

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