Tribunal classifies imported aluminium profiles, rejects appellant's argument. Penalties not imposed due to appellant's belief.

M/s. D&M BUILDING PRODUCT PVT LTD., Sri Prabprit Singh Kochar Managing Director Versus The Commissioner of Customs

M/s. D&M BUILDING PRODUCT PVT LTD., Sri Prabprit Singh Kochar Managing Director Versus The Commissioner of Customs - 2019 (370) E.L.T. 1183 (Tri. - Bang.) Issues Involved:
1. Classification of imported aluminium profiles under CTH 7604 or CTH 7610.
2. Invocation of the extended period for the demand.
3. Imposition of penalties under Section 114A and Section 112(a) of the Customs Act, 1962.

Detailed Analysis:

1. Classification of Imported Aluminium Profiles:
The primary issue is whether the aluminium profiles imported by the appellant should be classified under CTH 7604 (Aluminium bars, rods, and profiles) or CTH 7610 (Aluminium structures and parts of structures).

Appellant's Argument:
- The aluminium profiles are flat profiles of uniform cross-section, not prepared for use in structures at the time of import.
- These profiles are cut and drilled on-site based on customer requirements, thus should be classified under CTH 7604.
- The HSN Explanatory Notes indicate that profiles not worked upon (drilled, bent, etc.) should not be classified under 7610.

Revenue's Argument:
- The profiles are specifically designed and prepared for use in structures, as described in product catalogues and technical write-ups.
- The profiles have specific part numbers indicating their use in structures such as partitions and door frames.
- The profiles retain their essential character of being prepared for use in structures even if minor processes like cutting or drilling are done on-site.

Tribunal's Decision:
- The Tribunal examined the relevant Section/Chapter notes and HSN Explanatory Notes.
- It concluded that the profiles, as described by the suppliers and used by the importers, are prepared for use in structures.
- The profiles are identifiable with specific product codes and are not described as general aluminium profiles.
- Therefore, the Tribunal held that the profiles are classifiable under CTH 7610 9030.

2. Invocation of Extended Period:
The second issue is whether the extended period for the demand can be invoked.

Appellant's Argument:
- The appellant had informed the department about the nature of the goods and their usage.
- A previous show-cause notice dated 02.03.2010 had already addressed the classification issue, and no extended period was invoked then.
- The issue relates to a classification dispute, and extended periods cannot be invoked in such cases.

Revenue's Argument:
- The appellant had changed the classification from CTH 7610 to CTH 7604 on their own, misusing the self-assessment and RMS facility.
- The extended period is justified due to the appellant's actions.

Tribunal's Decision:
- The Tribunal found that a previous show-cause notice had already been issued, and the department was aware of the classification issue.
- Therefore, invoking the extended period in the subsequent show-cause notice dated 10.10.2013 is not justified.
- The demand is restricted to the normal period.

3. Imposition of Penalties:
The third issue is the imposition of penalties under Section 114A and Section 112(a) of the Customs Act, 1962.

Appellant's Argument:
- The appellant acted under a bona fide belief regarding the classification.
- The previous order by Commissioner (Appeals), Chennai had accepted the classification under 7604, leading the appellant to believe it was correct.
- There was no intention to evade duty, and hence, no penalty should be imposed.

Revenue's Argument:
- The appellant's actions indicated a deliberate attempt to misclassify the goods.
- Penalties are justified based on the appellant's conduct.

Tribunal's Decision:
- The Tribunal held that the extended period cannot be invoked, and consequently, the equal penalty under Section 114A cannot be imposed.
- The penalty on Shri Prabprit Singh Kochar under Section 112(a) is also not justified as the issue relates to a classification dispute without mens rea.
- The Tribunal remanded the matter to the original authority to re-quantify the duty for the normal period.

Conclusion:
- Appeal Nos. C/1810/2012 and C/2001/2015 are allowed in toto.
- Appeal No. C/2006/2015 is remanded to the original authority for re-quantification of duty for the normal period, and the penalty imposed is set aside.