2021 (10) TMI 945 - SC - Customs

Supreme Court Upholds 'Whey Protein' Classification, Remits Valuation Issue for Reconsideration

The Supreme Court upheld the classification of the product as 'whey protein' as determined by the Commissioner of Customs and endorsed by the Tribunal. ... Valuation of imported goods - Classification of goods - whey protein - efficacy of Section 3 of the Customs Tariff Act, 1975 and Section 4A of the Central Excise Act, 1944 - HELD THAT:- The view taken by the Commissioner in respect of classification of product specified as ‘whey protein’, is the correct view, which does not require interference. The Tribunal has rightly endorsed that position. It is a different matter that the Tribunal in the impugned judgment ought to have elaborated on the aspects dealt with by the Commissioner, to take that view. That does not take the matter any further for the Appellant-Department. However, the only indulgence that needs to be shown in this appeal is in regard to the issue of valuation. For, the Tribunal has not adverted to the efficacy of Section 3 of the Customs Tariff Act, 1975 and Section 4A of the Central Excise Act, 1944 at all. Whereas, it decided the issue under consideration only in reference to Section 14 of the Customs Act, 1962. We set aside the finding and conclusion of the Tribunal on the issue of valuation and relegate the parties before the Tribunal by remanding the appeal for considering the limited issue of valuation, afresh on its own merits and in accordance with law - application disposed off. Issues: Classification of product as 'whey protein', Valuation issue under Customs Tariff Act, Central Excise Act, and Customs ActClassification of product as 'whey protein': The Supreme Court reviewed the judgments and orders passed by the Commissioner of Customs and the Customs, Excise & Service Tax Appellate Tribunal regarding the classification of the product as 'whey protein'. The Court found that the view taken by the Commissioner was correct, which was also endorsed by the Tribunal. However, the Court noted that the Tribunal should have elaborated more on the aspects considered by the Commissioner. Despite this, the Court upheld the findings and conclusions of both the Commissioner and the Tribunal on this issue.Valuation issue under Customs Tariff Act, Central Excise Act, and Customs Act: The Supreme Court observed that the Tribunal did not consider the efficacy of Section 3 of the Customs Tariff Act, 1975, and Section 4A of the Central Excise Act, 1944, while deciding the valuation issue. The Tribunal only referred to Section 14 of the Customs Act, 1962. As a result, the Court decided to remit the matter back to the Tribunal for reconsideration of the valuation issue. The Court directed the Tribunal to examine all contentions available to both parties on the issue of valuation, independently and in accordance with the law. The Court set aside the Tribunal's finding on valuation and ordered a fresh consideration of this specific issue.In conclusion, the Supreme Court partially allowed the appeal, specifically in terms of remanding the matter to the Tribunal for a fresh assessment of the valuation issue. The Court emphasized that all contentions related to valuation remain open for both parties to be examined by the Tribunal independently and in compliance with the law. The Court did not pass any order regarding costs in this matter.