TaxTMI 
TaxTMI 
1999 (9) TMI 283
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....t of duty; that in subsequent adjudication proceedings the Commissioner has demanded differential duty holding that they had imported complete CTVs in unassembled condition in violation of EXIM policy for the period after 25-3-1996; that exemption under Notification Nos. 91/89-Cus., 36/96-Cus. and 79/95-Cus. was not available to the goods imported by them and that extended period of limitation is invokable as they have suppressed the fact of import of CTVs in unassembled condition from the Department. He further submitted that it was alleged in the show cause notice that the applicants have imported CKD kits of CTVs and not components of CTVs and applying Rule 2(a) of the Interpretative Rules, the goods imported have to be assessed as CTVs under sub-heading 8528.12 of the Customs Tariff; that the Commissioner has categorically held in the impugned order that the items imported were not SKD or CKD kits of CTVs; that once the Commissioner held so, the show cause notice issued to the applicants has to be dropped as he cannot uphold the notice on an entirely different ground not raised in the notice. The learned Counsel emphasised that the Commissioner has clearly held that there was n....
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....the European Court in the case of Develop Dr. Eisblin GmbH & Co. and Haupt-30 llamt Stuttgart - West wherein it was held that complexity of process required for assembly of an article does not affect the application of Rule 2(a); that this judgment was delivered in the light of antidumping duty and the European Court was not considering the HSN Explanatory Notes regarding simple technic. The learned Advocate also pointed out that the European Court in its judgment has mentioned that the component parts, that is the parts which may be identified as components intended to make up the finished product, are all presented for customs clearance at the same time whereas the Commissioner in his impugned order omits the words 'at the same time'. He further submitted that HSN Explanatory Note to Interpretative Rule 2(a) were amended and word 'simple' was deleted from the explanatory note of this Rule in March, 1997. By this amendment a new para was also added which provides that "No account is to be taken in that regard of the complexity of the assembly method. However, the components shall not be subjected to any further working operation for completion into the finished state"; that this a....
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....clared the items imported and sought for classification under a particular heading; that at the time of assessment of first Bill of Entry, query was made and replied by them; that as this is a case based on the change on the basis of assessment, suppression of facts cannot be alleged against them that they have the bona fide belief that the duty is payable as components as they had clearly mentioned in their application to the Government that 100% components would be imported in the first year and localization of components would commence from second year; that further an amendment made in HSN Explanatory Notes cannot be made the basis for holding suppression of facts by the appellants; that they were not deemed to have known the European Court's judgment as contended by the Commissioner and that claiming of an exemption in the Bill of Entry cannot amount to suppression of facts. The learned Counsel also mentioned that component parts are imported from various vendors approved by M/s. Sony Ltd. and these vendors insist on sale of certain prescribed minimum quantity of the components; that irrespective of their actual requirements of components, the purchase order is to be placed fo....
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....at the issue involved is not whether any complexity is involved in assembly of the components; that Commissioner had given clear cut findings that he does not accept the plea that what M/s. Sony India have imported are the components in unfinished form; that only one component i.e. Populated Circuit Board (PCB) has been subjected to processing which is nothing but soldering operation; that all parts are in fully finished stage; that processes mentioned in para 2 of Board's circular dated 30-9-1997 are nothing but assembly process. The ld. Sr. Counsel also relied upon the Board's Circular No. 366/82/97-CX, dated 18-12-1997 in which attention of the field formation was drawn to the fact that a large number of manufacturers have resorted to importing the components through different parts or at different times through the same ports and assemble the same in their factories. He also pointed out that circulars of such nature are not circulars issued under Section 151A of the Customs Act. He further submitted that an application made by the applicants to the Government for investment cannot decide the classification of the goods for the purpose of Customs Tariff. Referring to Import Lice....