Iron ore pellets treated as iron ore for cess and countervailing duty purposes, defeating the refund claim.

Iron ore pellets imported into India were treated as iron ore for levy purposes because pelletisation did not create a new commodity and was only a process of making ore marketable for metallurgical use. The cess under the Iron Ore Mines and Manganese Ore Mines Labour Welfare Cess Act, 1976 applies to iron ore produced in mines and is linked to excise duty; therefore, the same incidence extended to like imported goods under Section 3(1) of the Customs Tariff Act, 1975. Exemption notifications referring to iron ore pellets did not change their character. On this basis, the cess and consequential countervailing duty were leviable and the refund claim failed.

---

---

Issues: Whether iron ore pellets imported into India were liable to cess under the Iron Ore Mines and Manganese Ore Mines Labour Welfare Cess Act, 1976 and consequential additional duty under the Customs Tariff Act, 1975, so as to disentitle the importer to refund.

Analysis: The levy under the cess enactment applies to iron ore produced in any mine, and the scheme is tied to excise duty on such ore. Iron ore pellets were treated as falling within Chapter 26 of the Central Excise Tariff Act, 1985, and pelletisation was held not to create a new and different commodity. The process was regarded as one of making ore marketable for metallurgical use, not as one taking the goods outside the description of ore. Since the cess is recovered as excise duty, the same incidence follows for imported like goods under Section 3(1) of the Customs Tariff Act, 1975. The fact that exemption notifications referred specifically to iron ore pellets did not alter their character as iron ore for levy purposes.

Conclusion: The cess was leviable on imported iron ore pellets, the countervailing duty demand was valid, and the claim for refund failed.

---