TaxTMI 
TaxTMI 
2013 (1) TMI 469
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....CVD). As per the said Sr. No. 4 of the said notification, if the imported goods are ore, then they are eligible for the benefit of "Nil" rate of CVD. The lower authorities felt that in terms of new Chapter Note No. 4 inserted vide Finance Act, 2011 in Chapter 26 of Customs Excise Tariff Act, 1985, the Concentrate obtained from ores is liable for payment of CVD and the benefit of said notification would not be available. Taking such a view, representative samples were collected from each consignment and sent to Central Excise and Customs Laboratory, Vadodara for testing purposes. The Chemical Examiner, Vadodara had given the test result as under : The sample is in the form of Brown Grey Coloured Coarse powder. It is composed of oxides of zirconium and silica along with small amount of oxides of iron. It has the following contents : 1. ZrO2 = 66.1% 2. ZrSiO4 = 98.3% It is Zircon Concentrate. 3. Afterwards, a copy of the test was given to the appellant and it was informed to him that the goods which were imported were Zircon Concentrate and hence attracting the CVD @ 10% and he was directed to pay the CVD as applicable. The appellant disputed the leviabil....
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....ular sand of Zircon Ore. It is his submission that how the CRCL has come to the conclusion that it is a Concentrate, is unknown to them as it is undisputed that the CRCL did not do any analysis or test in the laboratory. It is his submission that the Ministry of Mines and Indian Bureau of Mines having a Modern Mineral Processing Laboratory and Pilot Plant at Nagpur was also contacted by the Revenue authorities for the chemical analysis of Zircon Ore imported by the appellant and others. It is his submission that the said laboratory vide their letter dated 10-1-2012 specifically informed that the sample is naturally occurring Zirconium Ore. He would rely heavily on these and submit that the goods imported by the appellant are Zirconium Ore and are eligible for the benefit of Notification No. 4/2006-C.E. He would also take us through the HSN note and headings and submit that Zircon and Zircon sand are nothing but Ore as it is mentioned in Heading No. 26.15. He would also take us through the C.B.E. & C. Circular No. 556/52/2000-CX., dated 30-10-2000 to submit that how Ore is converted into Concentrate and more specifically Zircon Concentrate is done. It is his submission that the deci....
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....ntrate can come into existence only when the Zircon Ore is further acted upon or processed to yield Zircon Concentrate. It is also his submission that the samples which were sent for analysis were nothing but Zircon Concentrate and hence appellant is not eligible for the benefit of Notification No. 4/2006-C.E. 6. We have considered the submissions made at length by both sides and perused the records. 7. The issue involved in this case is whether the appellant herein who has imported some goods and declared the same as Zircon sand (Zircon Ore) and claimed the benefit of non-payment of CVD by availing the benefit of Notification No. 4/2006-C.E., is correct in doing so. 8. From the perusal of the records, it is undisputed that the goods which were imported by the appellant were sampled by the lower authorities and the said samples were sent to CRCL for analysis. The analysis of the CRCL resulted in a reply which came from CRCL that the appellant's samples were forwarded by CRCL to Indian Rare Earths Ltd. Research Centre, Kollam for analysis. This has come out on record on an RTI application filed by the appellant as regards the analysis of the samples which wer....
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....emsp;We find that the Director of the Revenue Laboratories was in touch with the Indian Rare Earths Ltd., Research Centre, Kollam as regards analysis of the said samples. In response to the correspondence from the Director (Revenue Laboratory) CRCL Delhi, Indian Rare Earths Ltd. Research Centre, Kollam vide their letter No. RC : LAB : SO : 2502 : 240, dated 16-7-2011 has replied as under : Ref : RC : LAB : SO : 2502 : 2240 date : 16-7-2011 To, Dr. T.K. Roy, Director (Revenue Laboratories), Central Board of Excise & Customs, Central Revenue Control Laboratory, Hill Side, Pusa Complex, New Delhi 110 012 Dear Sir, Subject : Analysis of Zircon sample. Ref. : Your Letter No. C No. 33-Cus/C-13/2011-12/30-6-2011, dated 14-7-2011. This has reference to your above letter regarding analysis of 5 Zircon samples. With respect to chemical analysis we conduct the analysis by XRF for the following elements only ZrO2, SiO2, AI2O3, Fe2O3, TiO2. We do not conduct the analysis for U and Th. Mineralogical analysis is conducted to determine impurities present in Zircon (other minerals). Typical ....
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....by the Assistant Commissioner of Customs, ICD, Pimpri and Assistant Commissioner of Customs, Gr. I JNCH, Nhava Sheva. The Ministry of Mines, Indian Bureau of Mines, after analyzing the samples of Zircon sand (Zircon Ore) has informed both the Assistant Commissioners in separate letters as under : Letter dated 16-11-2011 : No. 402(43)/OD/Chem/2011-12/CB Date : 16-11-2011 To Mr. Akhtar Rashid, Asstt. Commissioner of Customs, Gr.I, JNCH (Jawaharlal Nehru Customs House)-Nhava Sheva, Tal. Uran, Dist : Raigad Sub : Results of chemical analysis of Zirconium sand/Zirconium ore of M/s. Tirupati Microtech Pvt. Ltd. Ref : No. S/26-Misc.-475/09-10, dated 16-4-2011; B.E. No. 3215555, dated 15-4-2011 Sir, With reference to the above mentioned letter, please find herewith the results of the chemical analysis of Zirconium sand/Zirconium ore of M/s. TIrupati Microtech Pvt. Ltd., which was sent to this laboratory, as under : SiO2 CaO HiO2 Fe2O3 Al2O3 LOI TiO2 P2O5 S Y2O3 ZrO2 % % % % % % % % % % % 33.25 0.12 1.56 0.51 0.94 0.50 0.83 0.36 0.07 ....
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....are also using and manufacturing Zirconium Concentrate. In our view, if that be so, the Revenue is not able to explain the fact that CRCL laboratory which analyses the samples sent by the Customs department has, in fact, chosen to send the samples to Indian Rare Earths Ltd. Research Centre, Kollam for analysis of said imported goods Zirconium sand. 17. We find that in an identical situation, in the case of Indian Rare Earths Ltd. - 2002 (139) E.L.T. 352 (Tri.-Kolkata), the Tribunal has held as under, which also fortifies our stand. "2. The process carried out by the appellants are that the sand is dredged from the sea beach and the sand slurry is subjected to spiraling and as a result the heavier minerals are separated. By this process about 80% of the lighter sand is eliminated, the remaining 20% are brought to the Mineral Separation Plant by pumping the slurry through pipe. There the individual minerals are separated by processes like drying electro-static separation, magnetic separation and gravity separations. The final recovery of minerals is less than 10% of the sand dredged from the sea of shore. 3. ... 4. During the hearing of the case, it ha....
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....nts. Sand as it occurs on the sea shore cannot be called mineral ores. Such sand is also not bought and sold as mineral ores. The processes carried out by the appellants lead to separation of valuable rare mineral sands from the ordinary sand. The processes are physical and mechanical in nature. No special processes including rosting or chemical treatment is carried out. The processes do not bring about any upgradation or augmentation of purity in the mineral sands separated from ordinary sand. It is also on record that the resultant mineral sands are bought and sold as ores only and not as concentrates of ores. It is clear from note 2 of Chapter 26 of the Central Excise Tariff that only ores which have been submitted to processes, not normal of the metallurgical industries are excluded from ores. Thus, ores which have been subjected to special treatment go out of the scope of ores. No such special treatment is carried out in the present case. 9. ..........Thus, the principle of law is clear that basic operations carried out to produce usable ore would not amount to manufacture of a new product. In the instant case, the appellants are carrying out certain physical and mecha....