Customs classification of low aromatic white spirit failed where test reports did not establish Chapter 27 parameters.

Classification of imported low aromatic white spirit under CTH 27101920 depended on Note 4 of Chapter 27 and the chemical test results. The CRCL, Kolkata report did not affirmatively establish the prescribed distillation parameters, including the 90% by volume distillation requirement at 210 C, so the material on record did not support classification under CTH 27101920. On the import policy issue, the importer's licence covered a Class B petroleum product, and the alleged excess was not treated as sufficient to justify confiscation in the facts noted. The departmental appeal failed and the order under challenge was upheld.

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Issues: Whether the imported goods declared as low aromatic white spirit were correctly classifiable under CTH 27101920, and whether confiscation and penalty were sustainable on the basis of the test reports and alleged import policy violation.

Analysis: The classification dispute turned on Note 4 of Chapter 27 of the Customs Tariff Act, 1975 and the chemical test results. The test report of CRCL, Kolkata showed flash point, IBP and FBP values that did not satisfy the prescribed parameters for light oils and preparations or solvent 125/240. The note required 90% or more by volume to distil at 210 C, and the report did not establish that essential condition. The record also showed that the report relied upon by Revenue did not support the conclusion that the goods answered the description adopted for CTH 27101920. On the PESO issue, the licence held by the importer covered Class B petroleum product and the alleged excess was not held sufficient to justify confiscation in the facts of the case.

Conclusion: The goods were not held classifiable under CTH 27101920 on the basis of the material on record, and the confiscation and penalty were not interfered with in favour of Revenue.

Final Conclusion: The departmental appeal failed and the order under challenge was upheld, leaving the importer with the benefit of the classification and consequential reliefs already granted.

Ratio Decidendi: For classification under Note 4 of Chapter 27, the prescribed distillation parameters must be affirmatively established by the test material, and a report that does not satisfy those parameters cannot sustain classification under CTH 27101920.

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