Manganese concentrate classification denied exemption where washing and sizing converted imported ore into concentrate under tariff rules.

Imported manganese ore that had undergone washing, removal of waste, crushing and sizing was treated as manganese concentrate under Chapter Note 4 to Chapter 26 of the Central Excise Tariff Act, because conversion of ore into concentrate is deemed manufacture and the tariff scheme distinguishes ore from concentrate where foreign matter is removed for metallurgical use or economical transport. Applying its earlier ruling on similar facts and strict construction of the exemption notification, CESTAT held that the importer could not claim the benefit of Notification No. 04/2006-CE. The denial of exemption was therefore upheld and CVD liability followed.

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Issues: Whether imported manganese ore, after washing, removal of waste and sizing, was to be treated as manganese concentrate and therefore outside the scope of Notification No. 04/2006-CE dated 01.03.2006, so as to attract CVD.

Analysis: The imported goods were not disputed to have undergone processes such as washing, removal of waste, crushing and sizing before shipment. In view of Chapter Note 4 to Chapter 26 of the Central Excise Tariff Act, 1985, the conversion of ores into concentrates is treated as manufacture, and the chapter scheme, read with the HSN explanatory notes, distinguishes ore from concentrate where foreign matter is removed by special treatment for metallurgical use or economical transport. The Tribunal followed its earlier decision on similar facts and held that, once such processes are admitted, the goods are to be regarded as concentrate. The CBEC circular relied upon by the appellant did not assist them in the present factual matrix, and the exemption notification, being in the nature of an exemption, had to be applied strictly. Accordingly, the importer was not entitled to the benefit claimed.

Conclusion: The imported goods were liable to be treated as concentrate and the denial of exemption was upheld.

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