Scrap classification of imported steel items led to setting aside confiscation, redemption fine and penalty.

Imported steel articles were treated as scrap where the record did not prove they were usable as such and customs had themselves valued them on a scrap basis. The Tribunal accepted that dormant scrap may include obsolete, worn-out, broken or otherwise discarded metal items from consuming industries. As the segregated items formed only a small part of the consignment and the scrap claim was not displaced by the evidence, confiscation, redemption fine and penalty were set aside.

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Issues: Whether the imported steel items were scrap and therefore not liable to confiscation, redemption fine or penalty.

Analysis: The imported consignment contained a small segregated quantity of steel articles such as hooks, nuts, rivets, strips, circles and sheets. The material on record showed that these items were not proved to be usable as such, while the customs authorities themselves had valued them on a scrap basis. The Tribunal also accepted that dormant scrap may include obsolete, worn out or broken products from consuming industries and other discarded metal items. In the overall circumstances, the rejected items formed only a small part of the total consignment and the claim that they were scrap could not be denied.

Conclusion: The items were held to be scrap, the confiscation and consequential redemption fine and penalty were set aside, and the appeal was allowed.

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