1999 (6) TMI 206 - AT - Customs

Imported goods reclassified as waste, leading to reversal of confiscation and penalties under Customs Act.

Classification of imported goods was the central issue in this case. The Tribunal determined that the goods, initially described as used pipes but ... Import - Demurrage charges Issues Involved:1. Classification of imported goods.2. Confiscation and penalty under Sections 111(d) and 111(m) of the Customs Act, 1962.3. Entitlement to a detention certificate for waiving demurrage charges.Summary:1. Classification of Imported Goods:The primary issue was whether the imported goods, described as MS scrap in the invoice and Bill of Lading, should be classified as waste and scrap under Heading 7204.29 or as used pipes under Heading 7304.90. The Commissioner of Central Excise (Appeals) held that the goods were used pipes and not waste and scrap as per Note 6 of Section XV of the Customs Tariff Act. The appellants contended that the goods were unusable as pipes due to rust and breakage and should be classified as scrap. The Tribunal noted that the Revenue had not provided evidence to classify the goods as fresh pipes and accepted the appellants' claim that the goods were intended for melting in an induction furnace. The Tribunal concluded that the goods met the definition of waste and scrap under Note 6 of Chapter XV and should be classified accordingly.2. Confiscation and Penalty:The Commissioner (Appeals) had ordered the confiscation of the goods under Sections 111(d) and 111(m) of the Customs Act, 1962, due to the discrepancy between the description in the Bill of Entry and the actual goods found. The Tribunal found that the Revenue had accepted the goods as old and used pipes and had not disputed their value as scrap. The Tribunal held that the goods were not fresh and new, and the appellants' declaration should have been accepted. Consequently, the goods were not liable for confiscation, and the penalty imposed was unjustified.3. Detention Certificate for Waiving Demurrage Charges:The appellants sought a direction for the Customs authorities to issue a detention certificate to waive demurrage charges. The Tribunal agreed with the appellants, citing judgments that supported the issuance of such certificates when goods were detained without proper evidence. The Tribunal directed the Customs authorities to issue the certificate, as the detention was due to non-application of mind by the authorities.Conclusion:The appeal was allowed with consequential relief, including the reclassification of the goods as waste and scrap, setting aside the confiscation and penalty, and directing the issuance of a detention certificate to waive demurrage charges.