TaxTMI 
TaxTMI 
2018 (12) TMI 174
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.... the import documents, the department has observed that the appellant had wrongly availed the benefits of concessional rate of duty under Notification No. 19/1994-Cus in as much as the exemption under subject Notification was specifically for the Coking Coal of Ash Content below 10.29%. Accordingly, the SCN dated 15.05.1998 was issued to the appellant for recovery of differential Customs duty which was adjudicated Vide Order in Original wherein the differential Customs Duty was confirmed. Being aggrieved by the said Order in Original, the appellant filed appeal before Commissioner (Appeals) which came to be rejected, therefore, the present appeal. 2. Shri. P. P. Jadeja, Ld. Consultant appearing on behalf of the appellant submits that the appellant had entered into the agreement dated 27.12.1994 for import of 15.00 MT "Weak Coking Coal" with detailed specification and pre-shipment examination by independent Surveyors SGS with internationally credible and to import carried out pre-shipment inspections/analysis. As per the specification communicated by supplier to the appellant the goods description is Weak Coking Coal of ash Content 10 % maximum. He submits that as per Certificate....
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....e not in accordance with Law and drawn with no regard whatsoever to IS: 436. That IS: 436 would apply but if the methods of testing of any items of the Central Excise Tariff are not mentioned that Indian Standard Institution Method should be apply. That these would apply to Customs Act, as well. He submits that OIO denied exemption on the ground that Chemical Examiner's Test Report shows goods as "Coal having ash content 10.29 %", whereas exemption is available to "Coking Coal having Ash content less than 12 %. The OIA is on the basis that imported coal is not used for manufacture of "Coke" in Materlogical Industry; therefore, it is not coking coal. He submits that expression "Coking Coal" used in exemption Notification No. 19/1994-Cus is a genus and would cover within its ambit different species thereof such as prime/hard coking coal, semi-hard coking coal, medium coking coal, soft coking coal, semi-soft coking coal, weak coking coal etc. He placed reliance on the Ministry of Coal Notification defining Coals other than coking or semi-coking or weakly coking coals as non-coking coals. The coal Directory of India also contains the very same definitions of semi coking and weakly Coki....
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....92 (Tri.Del) • Goyal Traders 2014 ((302) ELT 529 (Guj.) • Raj Petroleum Products Ltd 2013 (292) ELT 125 (Tri.Mum) • Ricoh India Ltd 2009 (247) ELT 433 (Tri.Mum) • Sah Petroleums Ltd 2009 (246) ELT 716 (Tri.Mum) 5. Sh. A. Mishra, Ld. Deputy Commissioner (AR) appearing on behalf of the Revenue reiterates the finding of the impugned order. He further submits that as per the test report No.65-Cus/97 dated 20.06.1997 of CRCL, New Delhi, it is clear that the goods imported is coal and not weak coking coal, therefore, the benefit of exemption was rightly denied to the appellant. 6. We have carefully considered the submissions made by both the sides and perused the records. We find that the whole issue to resolve is whether the goods imported by the appellant is weak coking coal having Ash content below 12% and consequently eligible for exemption notification 19/94-cus dated 01.03.1994, which is reproduced below: Effective rates for certain specified goods falling within Chapter 27 In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied....
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....ts physico-chemical properties are available in the technical literature. However in the chemical analysis result, it does not show that whether it is weak coking coal or otherwise. Therefore, the test report 65-Cus/97 only confirms that the sample is of coal and Ash content is 10.29%. There is no dispute that the weak coking coal is also specie of coal ash content being 10.29% is well within the parameter prescribed in the entry Serial No of the notification i.e. below 12%. It can be seen that as per above report the remark of the chemical examiner regarding not mention of specification of weak coking coal is with reference to technical literature, it is nothing to do with actual analysis of coal conducted by the chemical examiner. Therefore, the report does not confirm that the goods imported by the appellant is not weak coking coal, therefore, only on the basis of the test report it cannot be concluded that the coal imported by the appellant is not weak coking coal. The department has nothing on record except aforesaid report to conclude that the coal imported by the appellant is not weak coking coal. Therefore, as regard the contention of the department that the coal imported b....
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....al and filed a bill of entry on 04.04.97, declaring the Ash Content of the coal less than 12% and under the claim of benefit of concessional rate of duty in terms of Notification No.11/97-Cus. The said notification granted concessional rate of duty, if the Ash Content in the coal is less than 12%. 3. It is seen that at the time of filing of bill of entry, the appellant produced certificate of quality issued by the supplier of the goods at Indonesia and produced by them at the Load Port, certificating the Ash Contents in the coal to be 9.98% (Air Dried) in accordance with ASTM capital method. At the Discharge Port, samples were again drawn for every 2000 Metric tones of the said goods discharged by M/s. SGS India Ltd., who also conducted the tests and vide their test report dated 25.04.97 have certified the Ash Content as 10.20% (Air Dried). 4. The bills of entries so filed by the assessee were assessed provisionally. The Customs House at the Discharge Port drew samples and sent the same to the Customs House Laboratory, Kandla. The test report of the said laboratory showed the Ash Contents as being 14.4%. As the said laboratory suggested that samples be tested by Central Fuel ....
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....method as also on the basis of time gap and as such the said sample results cannot be relied upon. 7. He has further submitted that the two testing reports produced by the appellant conclusively established that the Ash Content in the said goods is below 12%. On the other hand the two reports produced by the Revenue are contrary to each other in as much as in the Customs House Laboratory, Kandla test report the Ash Contents has been shown as 15.9%, whereas the Dhanbad Laboratory has shown the same to be 13.2%. As such the decreased Ash Contents as shown by Central Fuel Research Institute, Dhanbad, as compared to the Ash Contents shown by Kandla Laboratory lead to only one fact that the said two reports are not reliable and should not be made the basis for confirmation of demand against them. He has also relied upon various Tribunal decisions to support his above pleas. 8. Countering the arguments learned SDR, Shri Rajendra Nagar, draws our attention to the impugned orders and submits that the authorities below have correctly relied upon the report of the Chief Chemist of Customs House Laboratory as also the Central Fuel Research Institutes report. The cross examination conduc....
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.... as under: "Report The sample is coal in the form of black coloured coarse powder. Ash.(ADB)15.9% whether it is Low Ash Coking Coal could not be ascertained here. The duplicate sample may be forwarded to Central Fuel Research Institute, Dhanbad". As is clear from above report a suggestion was made to send the sample for further testing to Central Fuel Research Institute. Accordingly, the sample was sent and a report was received from the said institute on 13.7.1998 i.e. almost after 10 months from the report of the chemical examiner. As per the said report moisture on air dried basis was to the extent of 9.5% and Ash on air dried basis was to the tune of 13.2%. It was disclosed in the said report that "sampling not done by CFRI". Further, the said report carried remark to the effect that "the quantity of the sample is not representative as per IS:436 (Part-1/ Sec-I) -1964 (Part-II)-1981." 11. The above two reports are the basis for denial of exemption notification to the appellant. As such the sole question is as to whether the said two test reports can be held to be reliable and more effective than the two certificates of Load Port and M/s. SGS India Lit., which are in....
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....depositions made by the chemical examiner the variation in Ash Contents would depend upon the method used and most importantly the drawing of sample. As we are all aware coal is in the form of huge and small lumps as also in powder form. The drawing of samples of coal is required to be done in accordance with IS:436. There is nothing on record to show that the sample was drawn in accordance with IS:436. On the other hand the test report of CFRI shows that the quantity of the sample was not representative as per IS:436. In such a situation, can it be said that the samples were drawn in accordance with the law and the test was done accordingly. In fact we note that ISI prescribes standards for testing coal for its Ash Contents in IS:1350. Neither the report of the chemical examiner nor CFRI states that the said method of testing as prescribed in IS:1350 was adopted by them. On the other hand we have the Load Port certificate, certificating that samples were analyzed in accordance with ASTM method. Chemical examiner in his cross examination has accepted that ASTM method is one of the recognized methods for testing the samples. The cross examination of the inspector conducted during th....
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....the drawing of the samples in accordance with the ISI and testing of the same in accordance with such standards is not forthcoming from the records. Even the two test reports which got conducted by the Revenue are at variance with each other. The remark of Dhanbad Laboratory showing that the sample was not representative as per ISI standards, further places the said report under doubt. The infirmities in the two said reports do not prompt us to place reliance upon the same and to hold that they reflect the correct Ash Contents. 17. We would also like to discuss here the Tribunals judgment in the case of Commissioner of Customs, Ahmedabad Vs. TATA Chemicals Ltd. reported in 2004 (177) ELT 1038 (Tri. Mumbai), strongly relied upon by the learned DR. We have gone through the entire judgment very carefully. In para 8 of the said judgment, it stands observed by the Tribunal that the respondents (as it was Revenues appeal) failed to produce any other report except the one given by foreign surveyors to disapprove the results communicated by the department. In the present case we find that apart from the Load Port report there is GGS report also in favour of the assessee. Further, in par....
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....Adani Exports Ltd, 2013 (295) ELT 678 (Guj.). In case of JSW Steel Ltd Vs. CC, C.EX. & ST, Goa 2016 (343) ELT 717 (Tri.Bom), the coordinate Bench of Tribunal categorically held that no "end use" conditions are provided in the notification, therefore, the usage cannot be determining factor. In view of these judgments, the finding of the Commissioner (Appeals) regarding "end use" is incorrect and not acceptable. We also gone through the judgment of Hon'ble Supreme Court in the case of Gujarat State Fertilizer Co. (Supra) wherein the Apex Court held that the fertilizer is of genus which may consist of various species of fertilizer namely, chemical fertilizer, soil fertilizer, animal or vegetable fertilizer as seen from description of various type of fertilizer found in chapter 31 of Central Excise Tariff Act, 1985 it was held that interpretation of expression under the Notification has to be given its due effect. Applying the ratio of above judgments in the present case, exemption is provided to weak coking coal which is genus of all coking such as prime/hard coking coal, semi-hard coking coal, medium coking coal, soft coking coal, semi-soft coking coal, weak coking coal etc. therefor....
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....ults. The sample recuivad is in the form of black coloured lungs of irreqular shape and size. it is con Ash content, moisture content and volatilo matter determined on the sam, lo is as under :- Ash Content Moisture Content Volatile Matter 7. 10.29 by ut. 6.30 by ut. = 50.Cy, by ul. No specification for weak coking coal with conpool to its Physico-Chemical proption in available in the technical literatuz. Suated unant tuned to you sly. CHE 81. enter in inlevent; recoins assessment. 21 24 pest sup Your faillifelly 2. BAG AA chior Chat Content Revenu Document 2 2212219 T-961 P. 13 BUT, SUPERINTENDING COMPANY OF INQONUSTA TEAD OFFICE EL CONDO CENTER IL BAYA PASM JAKARTA 1874 COW: 23774JAKARTA 10001 A ESPONDSHIS OF SCICIETE GENERALE CK SURVAILLANCE SA GENEVA CERTIFICATE OF : 'VCOPIHDO' 11X; M54 541, 0 SOFIA MA OFFICINE IN ALL WAM POSTS OF INDONELA (021) 分 No. SAMPLING AND ANALYЯIS 1739628 " DISCRIPTION OF BOOD 15,286.937 MT Of Mark Coking Coal BHIPPER VEGBEL PORT OF LOADING 145 From Bengkulu 1 P.T.Kiliran Pradana....