TaxTMI 
TaxTMI 
2006 (6) TMI 394
X X X X Extracts X X X X
X X X X Extracts X X X X
....partment's view, the assessment was done on a provisional basis. Duty was paid under protest. The respondents contested the assessment and appealed to the Commissioner (Appeals). After examining the issue thoroughly, the Commissioner (Appeals) held that the imported goods would be classifiable under Chapter 271119.00 and the respondents are entitled for the benefit of Notification No. 82/2004. The respondents' appeal was thus allowed. 3. Revenue is strongly aggrieved over the impugned OIA on the following grounds:- (i) There is a specific heading in respect of each variety of LPG depending upon its constituents. As per BIS Standards, (IS 4576:1999), there are three types of LPG based on the their principal constituent. (a) Commercial butane:- A hydrocarbon product composed predominantly of butanes, butylenes or their mixtures. (b) Commercial butane-propane mixture: A hydrocarbon product composed predominantly of a mixture of butanes and/or butylenes with propane and/or propylene. (c) Commercial propane: A hydrocarbon product composed predominan....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Chapter sub-heading i.e. 27111300 for butane (liquefied petroleum gas) in the Customs Tariff Act, 1975 and therefore, the cargo imported by M/s. Elf Gas India Ltd. is rightly classifiable under Chapter sub-heading 27111300 of Customs Tariff Act 1975 as the butane content is more than 60%. Chapter sub-heading 27111900 with the description 'others' is meant for liquefied petroleum gases which do not fall under Chapter Headings 27111100 to 27111400. The Notification No. 21/2002-Cus dated 1-3-2002, as amended by Notification No. 82/2004-Cus., dated 18-8-2004, specifically covers the "LPG" falling under Chapter sub-heading 27111900 of CTA. Therefore, the LPG falling under Chapter sub-headings 27111100 to 27111400 of CTA are not eligible for concessional rate of duty. Only intermixtures of gases in liquefied form, which has no single major constituent, can be classified under 'others' of Chapter sub-heading 27111900 by application of Interpretative Rules. (v) In view of the above, it appears that the Commissioner (Appeals) erred in deciding that the LPG imported by the importers merits classification under chapter sub-heading 27111900 of the CTA, and the impor....
X X X X Extracts X X X X
X X X X Extracts X X X X
....assified the item under Chapter 27111900 of CTA. (iii) The impugned goods were tested. The test results are as follows :- Bill of Entry No. 209557/2004 dated 12-11-2004. SI. No. Characteristics Result 1. Hydrocarbon Analysis, mole % Methane NIL C2 Hydrocarbons (Ethane) 0.17 C3 Hydrocarbons (Propane) 30.52 iC4 Hydrocarbons (Iso-butane) 16.98 n C4 Hydrocarbons (normal-butane) 52.14 i C5 Hydrocarbons (iso-pentane) 0.19 n C5 Hydrocarbons (normal-pentane) NIL Olefins ND 2. Density (by composition) @ 60°F 0.5566 3. Vapour Pressure at 40°C, KPa, gauge 576 Bill of Entry No. 209636/2004 dated 22-11-2004 SI. No. Characteristics Result 1. Hydrocarbon Analysis, mole % Methane Nil C2 Hydrocarbons (Ethane) Nil C3 Hydrocarbons (Propane) 12.08 i C4 Hydrocarbons (Iso-butane 12.08 n C4 Hydrocarbons (normal-butane) 73.50 i C5 Hydrocarbons (iso-pentane) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....0%, it would be appropriately called as an 'intermixture of butane and propane' falling under 'Others' of CH 2711.19 of the Customs Tariff Act. In the instant case, the test results indicate that the presence of Butane in the mixture is around 70% and the presence of propane is around 25 to 30%. Consequently, the impugned goods are correctly classifiable under CH 2711.19 of the Customs Tariff Act. Hence, the respondents are entitled for the benefit of Notification No. 82/2004-Cus., dated 18-8-2004. (vii) The learned Advocate pointed out that the Department, by changing the classification to 2711 13, seeks to deny the benefit of the Notification. This action of the Department has defeated the intention of the Government in protecting the consumers from the rise in international price. The authorities should interpret the Statutes and Notifications so as to give effect to the object, purpose and intention of the Legislature. The following case-laws were relied on :- (a) Tata Oil Mills Co. Ltd. v. CCE - 1989 (43) E.L.T. 183 (S.C.) (b) Oblum Electrical Industries Pvt. Ltd. v. CC, Bombay - 1997 (94) E.L.T. 449 (S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n for changing the classification? The learned Advocate has brought to our notice that the international price of crude increased enormously during the relevant period, thereby leading to an increase in the price of LPG and other products. In order to check the spurt in prices, the Government reduced the duty on LPG from 10% to 5%. It is well known that LPG is used by millions of consumers in the country. In these circumstances, Notification No. 82/2004-Cus., dated 18-8-2004 was issued. The relevant entry which is of interest to us in this appeal is as follows :- 75D 2711 19 00 Liquefied Petroleum Gases (LPG) 5% Needless to emphasise that the above Notification has been issued under Section 25(1) of the Customs Act by the Government in public interest. A product, which was all along being classified under CSH 2711 19 00, has, all on a sudden, been classified under CSH 2711 13 00 consequent to the issue of the Notification. The respondents had been denied the benefit and compelled to shell out more duty. Thus, Revenue has effectively denied the benefit on the specious ground that the LPG imported by the respondents is not the LPG mentioned in the Notification. The Rev....