TaxTMI 
TaxTMI 
2009 (6) TMI 513
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....Somu & Co., Bangalore 9. C/63/2006 -do- Murugarajendra Oil Industry Pvt. Ltd., Chitradurga 10. C/64/2006 -do- Siddaganga Oil Extractions Ltd., Tumkur 11. C/65/2006 -do- Prakruthi Solvex Pvt. Ltd. Tumkur 12. C/66/2006 -do- Unimers India Ltd., Navi Mumbai 13. C/67/2006 -do- Sami Labs Ltd., Bangalore 14. C/68/2006 -do- Synthite Industrial Chemicals Ltd., Cochin 15. C/69/2006 -do- Anantha Refinery Pvt. Ltd., Challakere, Karnataka 16. C/70/2009 -do- Sarda Vegetable Oils Ltd., Bellary 17. C/71/2006 -do- Parimala Agro Foods & Feeds Pvt. Ltd., Tumkur It can be seen from the above chart, the assessee as well as the Revenue are in appeal against the said OIO. Since all these appeals are arising against the very same OIO, they are being disposed of by a common order. 2. The relevant facts that arise for consideration are: The Officers of Directorate of Revenue Intelligence received intelligence to the effect that M/s. Pure Chemicals Co., Mangalore (hereinafter referred to also as PC) have evaded Customs duty by mis-declaring and wrongly classifying six consignments of imported ....
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....tity of 2739.451 MT of Exxsol Hexane RD imported, M/s. Pure Chemicals Co., Mangalore have- sold 1358.235 MT to several High Sea buyers under various High Sea Sales Agreements. In certain cases, after bonding the cargo under Section 59 of the Customs Act, 1962, bond-to-bond transfers totaling 212.00 MT have been effected to various buyers. They cleared the remaining quantity of 1169.216 MT on payment of duty, classifying them under different headings of the Customs Tariff. The Bills of Entry filed in respect of four consignments imported under IGMs No. 1273/09-05-2003, 0777/23-05-2002, 1355/07-07-2003 and 1574/18-12-2003 have been assessed to duty provisionally and the four Provisional Duty Bonds executed in this regard are pending finalisation. 6. Based on the Sales Specification of the product 'Exxsol Hexane RD' obtained from M/s. Pure Chemicals Co., Mangalore, DRI made a reference vide letter No. DRI/MRU/PC/52/2003/905, dated 31-12-2003 to the Indian Institute of Petroleum, Dehra Dun. The Institute furnished the reply vide letter dated 2-1-04 and it reads as follows: DR S.N. SHARMA Head Research Planning & Monitoring 2nd January, 2004 Dear Shri Bhat This has ....
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....nue Intelligence Regional Unit, Pulmar House Bejai Church Road, Bejai MANGALORE-575 004 Phone: 091-135-2660124 GARM: PETRINIST EPABX: 0135-2660113-116 Fax: 091-135-2660202, 203 E-mail: [email protected] (Ext. 243) (a) The product 'Exxsol Hexane RD' can be considered as a 'Special Boiling Point Spirit'. (b) According to the attached specifications of 'Exxsol Hexane RD', it comes under the category 'Special Boiling Point Spirit' with nominal boiling point range of 63-70°C. (c) 'Hexane fraction' is manufactured by fractional distillation of naphtha fraction, which in turn is obtained by fractional distillation of crude oil, but the straight run fractions as such do not meet revised BIS specifications (IS:3470). For meeting these specifications subsequent treatment like solvent extraction or hydrogenation is required (d) 'Hexane fraction' can also be manufactured from Natural Gas condensate. However, this will also need the processing steps as mentioned above. (e) 'Hexane fraction' (63-70°C) is not pure Hexane. However, this cut typically contains n-Hexane, about 50-55%. The rest of the components are isomers of Hexane, small quantitie....
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....ntion to the products mentioned in such items in para 3 of the Exim policy as it stood on 31-3-95. It is also his submission that the items mentioned therein are mentioned by name, which would include "aviation turbine fuel, crude oil motor spirit, bitumen furnace oil, high speed diesels and the channeling agency indicated therein is IOCL. It is his submission that the product which was imported by them was not to be used as any of the items as indicated in the said Part 3 but was being used by the pharmaceutical companies and vegetable extraction units as a solvent. He would submit that the intention of the Government was always to cannalise only motor spirits used as fuel and not an industrial raw material like 'Exxsol Hexane RD' though the said product may have special boiling point as specified under Chapter 27. It is also his submission that the imported item is admittedly used by the various industries like pharmaceutical industries solvent extraction unit as a solvent and not as an aviation fuel or motor spirit. (2) It is his submission that the industry took up the matter with the DGFT. DGFT vide their Policy Circular dated 14-7-04 clarified that the product 'exxsol hexa....
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....ammable liquid derived from distillation of petroleum, used as a solvent. It is his submission that the imported product contains different isomers as Hexane, would be 89% a per the suppliers report and 88% as per the test Report of CPCL. It was submitted that presence of other contents, the percentage of which does not exceed 12% has to be treated as impurities. He would also submit that CBEC Circular dated 22-2-01 classified mixture of hydro carbons under Chapter 29 and hence the product imported by them is squarely covered under Chapter 29 as the said product is a mixture of separately chemically defined compounds. It is his submission that Hexane imported is not a motor spirit. 4. Learned SDR on the other hand would submit that the composition of the product as indicated in the above paragraph will clearly indicate that Sl. No. 5 to 9 in the composition are not isomers. It is her submission that Chapter note 1(a) and 1(b) and Chapter 29 are very relevant for the product to classify under Chapter 29. It was submitted that by application of Chapter note 1(a) 1(b), the product would get out of Chapter 29 and will automatically fall under Chapter 27. It is her submission that th....
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.... and in polymers and plastic industries. Mere perusal of the assessee's list would indicate that either they are traders or manufacturers of bulk drugs and pharmaceuticals or vegetable extraction units. The said fact is not disputed by the revenue in the Order-in-Original before us. We find that after the said investigation started and various show cause notices issued, the Chemical Industries Apex body of the manufacturers of chemicals sent a representation to the DGFT New Delhi on 17th April, 2004. We may reproduce the said representation: 17th April 2004 To The Director General of Foreign Trade Udyog Bhavan Moulana Azad Road, New Delhi - 110011 Sub: Hexane Dear Sir, We would like to bring to your notice certain difficulties faced by our members in different industries like Pharmaceutical & Bulk drugs, Oil seed Extraction Polymers & Plastics etc. Hexane which is generally available as mixture of Isomers of Hexane or Commercial Hexane in commercial quantities is a chemical product which is one of the raw materials used by our members in the above mentioned industries. It is used as a solvent in manufacturing processes. Hexane available locally is n....
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....fuel and the principle behind canalizing import of fuels. Hence we kindly request you to give a clarification to the effect that Hexane Irrespective of the classification is covered under OGL. Also we would be grateful if a further clarification is given that the public sector Oil companies have been made the canalising agency only for fuels and not for any chemicals. A specific clarification may be given for Chapter 27.10 as fuels and canalisation of fuels are covered only under this chapter and there is also possibility that chemicals which does not meet the specification of fuel may also fall under the heading 27.10. Hence it is necessary to remove any ambiguity in policy which would affect the Trade and commerce. We would be only happy to provide with any further information which would help to speedup the clarification as our member organizations are continuing to face hardships in different ports. We look forward to your immediate attention and clarification which would help our members to meet their export commitments in time. Thanking you., Your faithfully, For Chemicals Industries Association Sd/- P.K.N. Panieckr President cc - 1 Mr. M. Raf....
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....is Policy or any other law for the time being in force. The itemwise export and import policy shall be, as specified in ITC(HS) published and notified by Director General of Foreign Trade, as amended from time to time. 2.2 Compliance with Laws: Every exporter or importer shall comply with the provisions of the Foreign Trade (Development and Regulation) Act, 1992, the Rules and Orders made thereunder, the provisions of this Policy and the terms and conditions of any licence/certificate/permission granted to him, as well as provisions of any other law for the time being in force. All imported goods shall also be subject to domestic Laws, Rules, Orders, Regulations, technical specifications, environmental and safety norms as applicable to domestically -produced goods. No import or export of rough diamonds shall be permitted unless the shipment parcel is accompanied by Kimberley Process (KP) Certificate required under the procedure specified by the Gem & Jewellery Export Promotion Council (GJEPC). 2.3 Interpretation of Policy If any question or doubt arises in respect of the interpretation of any provision contained in this Policy, or regarding the classification of any ite....