2025 (12) TMI 522 - AT - Customs

Quicklime imports held classifiable as PCC Lime under Customs Tariff 2522 1000, not 2825 9090, appeals allowed

CESTAT Kolkata held that imported 'PCC Lime 0/20MM (Quicklime)' is correctly classifiable under Customs Tariff Item 2522 1000 and not under 2825 9090 as ... Classification of imported PCC Lime 0/20MM (Quicklime) - to be classified under Chapter Sub-Heading 2522 1000 or under Chapter Sub-Heading 2825 9090? - HELD THAT:- An identical issue has already been examined by this Tribunal in the appellant’s own case M/S ITC LTD. VERSUS PRINCIPAL COMMISSIONER OF CUSTOMS (PORT), KOLKATA [2025 (7) TMI 648 - CESTAT KOLKATA], wherein by relying on the decision of the Tribunal at Bangalore in the case of M/S. JSW STEEL LIMITED VERSUS COMMISSIONER OF CUSTOMS, COCHIN [2025 (5) TMI 455 - CESTAT BANGALORE], this Tribunal has rejected the Revenue’s classification of the goods in question i.e., ‘Quicklime’, under Customs Tariff Item No. 2825 9090 and held the same to be rightly classifiable under Customs Tariff Item No. 2522 1000, as adopted by the assessee. From the decision cited, it is found that the Bench has observed that HSN Explanatory Note under Tariff Heading 28.25 excludes Calcium Oxide which has a purity less than 98% from Chapter 28, in view of the fact that what is covered under 28.25 is Calcium Oxide of purity 98% and thus, Calcium Oxide having purity of 98% or more would alone get covered under the scope of sub-heading 28.25. As seen from the test reports, the content of Calcium Oxide or lime in respect of the impugned goods is less than the requisite 98%. Therefore, classification of the impugned goods by the Revenue under the Chapter Sub-Heading 2825 9090 is not sustainable, as the purity is less than 98% in all these cases. The Revenue having failed to bring any evidence to the contrary on record, there are no reason to deviate from the above view already expressed by the Tribunal. Accordingly, by following the ratio of the aforesaid decision, the goods in question are rightly classifiable under Customs Tariff Item No. 2522 1000, as claimed by the appellant-assessee and the reclassification of the impugned goods under the Chapter Sub-Heading 2825 9090, by the Revenue rejected. There are no merit in the impugned orders and consequently, the same are set aside - appeal allowed. 1. ISSUES PRESENTED AND CONSIDERED 1.1 Whether imported goods described as 'PCC Lime 0/20MM (Quicklime)' are classifiable under Customs Tariff Item 2522 10 00 (Quicklime) or under Customs Tariff Item 2825 90 90 (other, under heading 2825). 1.2 Whether, in determining the correct classification, Quicklime containing Calcium Oxide (CaO) of less than 98% purity can fall within heading 2825 in view of the HSN Explanatory Notes. 1.3 Whether prior decisions of the Tribunal on identical facts, including in the appellant's own case, are applicable so as to govern the present classification dispute. 2. ISSUE-WISE DETAILED ANALYSIS Issue 1 & 2: Proper tariff classification of imported Quicklime; relevance of CaO purity and HSN Explanatory Notes under headings 2522 and 2825 Legal framework (as discussed) 2.1 The Tribunal examined the competing tariff headings as interpreted in earlier decisions, referring to: - Heading 2522: 'Quicklime, slaked lime and hydraulic lime, other than calcium oxide and hydroxide of heading 2825', specifically sub-heading 2522 10 00 - Quicklime. - Heading 2825: Inorganic chemicals; covers 'separate chemically defined compounds', including Calcium Oxide of high purity; residuary sub-heading 2825 90 90 - Other. 2.2 The Tribunal relied on HSN Explanatory Notes (as reproduced and applied in prior CESTAT decisions), which state that: - Quicklime (an impure calcium oxide) is classifiable under heading 2522 and that purified calcium oxide and calcium hydroxide are excluded to heading 2825. - Heading 2825 covers Calcium Oxide and Calcium Hydroxide only 'in the pure state' and that fused lime of a high degree of purity (approximately 98% CaO) falls under heading 2825, while 'Quicklime (calcium oxide) and slaked lime (calcium hydroxide) are excluded (heading 25.22)'. 2.3 The Tribunal noted the specific rule emerging from these Notes, as articulated in earlier decisions: Calcium Oxide of purity 98% or more alone falls under heading 2825; Quicklime with CaO content below 98% remains under heading 2522. Interpretation and reasoning 2.4 The Tribunal found as a matter of fact, on the basis of the test reports produced, that the CaO content of the imported consignments ranged between 87.20% and 90.50%, and in every case was less than 98%. 2.5 The Tribunal recorded that the appellant imports Quicklime in lump form (described as 'PCC lime - lime for processing into PCC') which is then processed in its PCC plant to obtain PCC in slurry form for use in paper manufacture. The goods in dispute are thus Quicklime, not a separate chemically defined, highly purified compound. 2.6 The Tribunal applied the ratio of the earlier CESTAT decisions (JSW Steel Ltd., Viraj Profiles Ltd., Jindal Stainless (Hisar) Ltd. and Bhadradri Minerals Pvt. Ltd.), which had authoritatively construed headings 2522 and 2825 along with the HSN Explanatory Notes, to hold that: - Quicklime is specifically covered under heading 2522 10 00. - Heading 2825 covers Calcium Oxide only when it is 'pure' or of a high degree of purity, approximately 98% CaO, as per the HSN Notes. - Where the CaO content is less than 98%, the product cannot be treated as purified Calcium Oxide under heading 2825; instead, it remains Quicklime classifiable under heading 2522. 2.7 The Tribunal also noted that the classification favoured by Revenue (2825 90 90) is a residuary entry, whereas Quicklime is expressly provided as a specific entry under 2522 10 00. Applying the principle that a specific entry prevails over a residuary entry, the product must be classified under 2522 10 00, absent proof that it satisfies the strict purity requirement for heading 2825. 2.8 The Tribunal further observed that HSN Explanatory Notes under heading 28.25 expressly exclude Calcium Oxide having purity less than 98% from Chapter 28; therefore, goods with CaO content below 98% cannot legally be placed under heading 2825. Conclusions on Issues 1 & 2 2.9 Since the CaO content of the imported Quicklime is admittedly less than 98% in all consignments, the goods do not meet the standard of 'high degree of purity' required for classification under heading 2825, and are excluded from that heading by the HSN Explanatory Notes. 2.10 Given that 'Quicklime' is specifically provided for under Customs Tariff Item 2522 10 00, and that heading 2825 90 90 is merely a residuary entry, the goods are rightly classifiable under Customs Tariff Item 2522 10 00. 2.11 The Revenue's reclassification of the goods under Chapter Sub-Heading 2825 90 90 is unsustainable in law and on facts and is therefore rejected. Issue 3: Applicability and binding effect of prior Tribunal decisions on identical classification dispute Interpretation and reasoning 2.12 The Tribunal noted that an identical issue concerning classification of Quicklime imported by the same appellant had already been decided by the Tribunal in a prior Final Order, wherein it was held, following JSW Steel Ltd. and other decisions, that Quicklime with CaO content below 98% is classifiable under 2522 10 00 and not under 2825 90 90. 2.13 The Tribunal observed that the factual matrix in the present appeals is identical to that in the earlier decided matter: the nature of the product (Quicklime), the use, and the range of CaO content are the same, and the Revenue had not produced any contrary evidence or distinguishing features. 2.14 In these circumstances, the Tribunal found no justification or reason to deviate from the view already expressed and consistently followed in the prior decisions, especially in the appellant's own case. Conclusions on Issue 3 2.15 The Tribunal followed its earlier decisions, including in the appellant's own case, and applied the same ratio to the present appeals, thereby holding that the goods in question are classifiable under Customs Tariff Item 2522 10 00. 2.16 The impugned orders of the lower authority, affirming classification under 2825 90 90, were set aside and the appeals were allowed, with entitlement to consequential relief as per law.