2024 (1) TMI 537 - AT - Customs

Imported bra cups classified under CTH 6212 not CTH 3926 based on essential character per Interpretative Rules 2(a)

CESTAT Bangalore classified imported bra cups under CTH 6212 rather than CTH 3926 of the Customs Tariff Act, 1975. The tribunal held that bra cups are ... Classification of imported goods - Bra Cups - to be classified under CTH 3926 of the Customs Tariff Act, 1975 or under CTH 6212? - period from 25.02.2010 to 14.07.2010 - benefit of the Notification No. 26/2000 Cus. dated 1.3.2000 - HELD THAT:- In this case, the Chapter 6212 clearly includes Brassier and when there is a specific description, the goods cannot be classified based on the content of the material used to manufacture the same. The Interpretative Rules as seen under clause 2(a) the essential character of the product decides the classification and here the bra cups undoubtedly are used as part of a Brassier and the impugned products are more akin to the description given under 6212 and therefore rightly classifiable under 6212 90 as per clause 4 of the Interpretative Rules. Regarding the benefit of the Notification, since it was not claimed at the time of import and the conditions therein were not satisfied the question of extending the benefit does not arise. The packing list placed clearly shows the items were imported in pairs and it is also a fact that a pair of bra cups are used for one brassier. The invoice also shows that the unit price shown is per pair and accordingly the total value is calculated. Therefore, the unit price for the pair should be taken as per unit price (set of 2 pieces) rather than artificially splitting the price for per piece. Section 19 of the Customs Act takes cognisance of articles imported in sets and therefore the said goods which are in pairs should be considered as a unit and the rate of duty to be calculated accordingly. The classification of the imported goods under CTH 6212 upheld - the impugned order is upheld as far as classification is concerned and appeal is remanded to the adjudicating authority to recalculate the duty taking into consideration the unit price for pairs as a single unit price. The appeal is disposed of by way of remand. Issues Involved:1. Reopening of classification and demand for differential duty.2. Correct classification of imported goods under CTH 3926 or 6212.3. Eligibility for benefit under Notification No. 26/2000 Cus. dated 1.3.2000.Summary:1. Reopening of Classification and Demand for Differential Duty:The Tribunal addressed whether the Revenue could issue a notice to the appellant for reclassifying goods and demanding differential duty after the goods had been cleared. Citing the Supreme Court's ruling in Union of India vs. Jain Shudh Vanaspati Ltd., it was established that a show-cause notice under Section 28 of the Customs Act can be issued subsequent to the clearance of goods under Section 47. The Tribunal emphasized that the Revenue could reopen their assessments within the prescribed time limits, provided the aggrieved parties are notified and given a reasonable opportunity to be heard.2. Correct Classification of Imported Goods:The primary dispute was whether the imported 'Bra Cups' should be classified under CTH 3926 or CTH 6212. The appellant argued for classification under CTH 3926, citing various test reports that described the composition of the goods. However, the Tribunal examined the relevant entries and HSN notes for both chapters. It concluded that the goods are more appropriately classified under CTH 6212, which covers 'Brassieres, girdles, corsets, braces, suspenders, garters and similar articles and parts thereof.' The Tribunal noted that the essential character of the bra cups aligns with the description under CTH 6212, as they are parts of brassieres.3. Eligibility for Benefit under Notification No. 26/2000 Cus. dated 1.3.2000:The appellant claimed a 'nil' rate of duty under the said notification. However, the Tribunal found that since the benefit was not claimed at the time of import and the conditions of the notification were not satisfied, the benefit could not be extended.Additional Considerations:The Tribunal also addressed the issue of duty calculation, stating that the duty should be charged on the value of the pair of bra cups rather than on a single piece. The packing list and invoice indicated that the items were imported in pairs and used as such. Therefore, the unit price for the pair should be considered as the single unit price.Conclusion:The Tribunal upheld the classification of the imported goods under CTH 6212 and remanded the case to the adjudicating authority to recalculate the duty based on the unit price for pairs. The appeal was disposed of by way of remand.