2025 (1) TMI 1683 - AT - Customs

Wireless microphone systems held classifiable under Tariff Item 85255050, eligible for Basic Customs Duty exemption under Notification 25/2005

CESTAT Kolkata allowed the appeal, holding that the imported 'Wireless Microphone System/Set' is correctly classifiable under Tariff Item 85255050 as a ... Rejection of requests of the appellants for re-assessment Bill of Entry - misclassification of imported Wireless Microphone 100 sets - to be classified under Tariff Item 85255050 or 85299000? - eligibility for exemption from payment of BCD Vide Sl.No.16 of N/N. 25/2005-Cus dated 01.03.2005 - HELD THAT:- The said issue has been examined by the ADG (Adjudication), DRI vide Order-in-Original No.07/NKU(10-12)/ADG(Adj.)/DRI/N.Delhi/2016-17 dated 30.03.2017, wherein it has been observed that the impugned goods i.e. “Wireless Microphone System/Set” imported by the appellant, are classifiable under Tariff Item 85255050 and is entitled the benefit of Notification No.25/2005-Cus dated 01.03.2005 as amended. The impugned goods imported by the appellant falls under the CTH 85255050 and is entitled for exemption from payment of BCD in terms of N/N. 25/2005-Cus dated 01.03.2005. There are no merit in the impugned order and the same are set aside - Appeal allowed. 1. ISSUES PRESENTED AND CONSIDERED 1.1 Whether 'Wireless Microphone System/Set' imported by the appellant is classifiable under Tariff Item 85255050 rather than 85272900/85299000. 1.2 Whether, upon such classification, the imported goods are entitled to exemption from Basic Customs Duty under Notification No. 25/2005-Cus dated 01.03.2005. 1.3 Whether the prior Order-in-Original of the Additional Director General, DRI (Adjudication), accepting classification under Tariff Item 85255050 and granting exemption, having attained finality, is binding and determinative for the present appeals. 2. ISSUE-WISE DETAILED ANALYSIS Issue 1 & 2: Classification of 'Wireless Microphone System/Set' and eligibility for exemption under Notification No. 25/2005-Cus Legal framework (as discussed) 2.1 The Court noted the competing tariff entries: 85255050 (claimed by the appellant, as accepted in earlier adjudication) and 85272900/85299000 (as alleged during DRI investigation and adopted in the self-assessed Bills of Entry). The exemption from Basic Customs Duty was claimed under Notification No. 25/2005-Cus dated 01.03.2005, specifically at Sl. No. 16, applicable to goods classifiable under Tariff Item 85255050. 2.2 The Court relied on Order-in-Original No. 07/NKU(10-12)/ADG(Adj.)/DRI/N.Delhi/2016-17 dated 30.03.2017, wherein the Additional Director General, DRI (Adjudication) had examined the identical goods and notifications, and held that 'Wireless Microphone System/Set' are classifiable under Tariff Item 85255050 and entitled to the benefit of exemption of Basic Customs Duty under Notification No. 21/2002-Cus, Notification No. 25/2005-Cus and Notification No. 12/2012-Cus. Interpretation and reasoning 2.3 The Court identified the 'short issue' as whether the imported 'Wireless Microphone System/Set' is classifiable under Tariff Item 85255050 or 85299000 and whether it is eligible for exemption of Basic Customs Duty under Notification No. 25/2005-Cus. 2.4 The Court observed that the very same issue of classification of 'Wireless Microphone System/Set' had already been examined and decided by the ADG (Adjudication), DRI in the above Order-in-Original, wherein it was categorically held that the impugned goods are classifiable under Tariff Item 85255050 and entitled to exemption from Basic Customs Duty under the cited notifications. 2.5 The Court noted that, in that adjudication, proceedings against the importer (including the present appellant) were dropped and that order had attained finality, as the Department had not challenged it in appeal. 2.6 In view of this prior adjudication, the Court implicitly rejected the rationale of the Commissioner (Appeals) that the self-assessment of the Bills of Entry under Tariff Item 85272900 and payment of duty under protest, without amendment under Section 149, barred relief. The Court treated the classification issue as already settled in favour of the appellant. Conclusions 2.7 The Court held that the impugned goods imported by the appellant, namely 'Wireless Microphone System/Set', fall under Tariff Item 85255050. 2.8 The Court further held that the said goods are entitled to exemption from payment of Basic Customs Duty in terms of Notification No. 25/2005-Cus dated 01.03.2005. 2.9 Consequently, the Court found no merit in the impugned order of the Commissioner (Appeals), set it aside, and allowed the appeals with consequential relief, if any. Issue 3: Effect of prior ADG, DRI adjudication attaining finality Interpretation and reasoning 3.1 The Court relied decisively on the earlier Order-in-Original of the ADG (Adjudication), DRI, which had dropped the show cause notice, held the goods classifiable under Tariff Item 85255050, and granted exemption under Notification No. 25/2005-Cus, and which had not been appealed by the Department. 3.2 The Court treated that adjudication as having settled the classification and exemption issues for the same goods and same importer, and as having attained finality, thereby binding the Department in the present matter. Conclusions 3.3 The Court concluded that, since the prior adjudication by the ADG, DRI had attained finality, the Department could not contend otherwise in relation to the same goods, and the appellant's claim for classification and exemption stood established on that basis.