TaxTMI 
TaxTMI 
2020 (8) TMI 656
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....r Sahib Chemicals Pvt. Ltd., Ghaziabad, U.P and M/s. Worldlink T.C. Bond Store, Gujarat had imported 'Nephtha' from its foreign supplier. 1.2 Vessel loaded the cargo from Iran and reached at Kandla Port on 30.07.2004. The total quantity of the subject goods was 5872.881 Mts. Out of the said total quantity, 3472.881 Mts covered vide BL Nos. 83/01 to 83/20 all dated 25.07.2004 pertained to Appellant - M/s. Neptune Tradelinks Pvt. Ltd. 1650 Mts. Covered vide BL Nos. 83/21 to 83/23 all dated 25.07.2004 pertained to M/s. Hazoor sahib Chemicals Pvt. Ltd and balance 750 Mts covered vide BL Nos. 83/24 to 83/26 all dated 25.07.2004 pertained to M/s Worldlink T.C. Bond Store. The said cargo on discharge was stored in the tank terminals of M/s J.K. Synthetics Ltd. Kandla and M/s Friends Salt Works and allied Industries, Kandla. Appellant had entered into contract dated 8.7.2004 with its foreign supplier for import of the subject goods (page 177-181 vol.2 paper book) 1.3 Bills of Entry for warehousing bearing Nos. 011798, 011799,011800 all dated 30.07.2004 were filed by M/s. Neptune Tradelinks Pvt. Ltd., M/s. Hazoor Sahib Chemicals Pvt. Ltd and to M/s Worldlink T.C. Bond Stor....
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....nge and have flash point above 25C. 3. Chapter Sub Heading 2710 19 90 (other) appears more appropriate for the sample u/r... " 1.7 Further it is the case of revenue that composite sample were also drawn from the above shore tanks on 07.08.2004 and the same were sent for testing to M/s. IOC Limited, Kandla and Refinery Division Jamnagar of M/s. Reliance Industries Limited. In regard to the aforesaid sample, to reports dated 14.08.2004 (pages 121, 122 vol. 2 paper book) were rendered by IOC Limited and a report dated 12.08.2004 (along with covering letter dated 12.08.2004) was rendered by M/s. Reliance Industries Limited (pages 139- 140 vol. 2 paper book). As per revenue these reports were against the detailed submissions in this regard will be made herein after. 1.8 As per revenue in view of above, the imported goods were seized on 17.08.2004. However on request having been made by the Appellant and worldlink T.C. Bondstore, revenue permitted provisional clearance of the goods against bond and bank guarantees. Revenue conducted further investigation, while recording statements various persons. Basic case of revenue is that boiling range/distillation range ....
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....ed 18.02.2008. Vide said order, amongst others it was held that the chemical examiner is required to give only the report on the chemical analysis conducted by him and therefore his opinion dated 7.8.2004 about classification should be ignored. While appreciating the submission of Appellant in regard to reports rendered by Reliance Industries Ltd. and IOC Ltd. it was held that the said reports cannot be the sole basis for coming to conclusion against the importers and that the said reports at best could be considered as supportive evidence. Further it was held that the report of Chemical Examiner did not indicate the method adopted in the analysis. Therefore, it was not clear whether the tests report was conducted as per ASTM D86 method prescribed under Note 4 of Chapter 27 and that the said information could have been elicited during cross examination of the chemical Examiner, under these circumstances cross examination of the chemical Examiner ought to have been allowed by the Ld. Adjudicating authority. Accordingly the impugned order was set aside and the matters were remanded for denovo consideration after permitting cross examination of the 'Chemical Examiner' and in light of ....
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.... Kandla were correct. Consequently it was held that the notices. Importers had failed to extinguish the allegation of mis-declaration leveled against them in the impugned show cause notice. Accordingly the Ld. Respondent confirmed demand of duty, imposed redemption fine and penalties as was done vide initial order in original dated 29.3.2007, as stated above. 2. Ld. Counsel for the appellant argued that the Tribunal orders dated 18.02.2008 remanded the matter back for the de-novo consideration permitting cross examination of the Chemical Examiner. In this circumstances cross examination of Shri. Shri. T.K. Myelvalganan was beyond the scope of remand. It was argued that no Reliance can be placed on the cross examination of Shri. T.K. Myelvalganan. It is argued that the second witness was introduced during the said remand proceedings only to cover up for the lacunas pointed out during cross examination of the Chemical Examiner, Shri. Dilip Mehta. Ld. Counsel further argued that Reliance Industries Limited and IOC Limited are in the nature of business competitors and no reliance on the tests reports made in the labs of the said companies can be taking on record. 3.1 Ld. Counsel ....
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....g. Hence Sh. Dilip Mehta was not even aware of the basic aspect of grouping as per ASTM D86 method. He further argued that his answered to question no. 34, 35, 36 and 51 show that Shri. Dilip Mehta was not even aware that proper measuring device/ thermometer was required to be used in testing, as stated above,. In answer to question no. 45 he stated that the equipment used for testing the sample did not bear the nomenclature of mode of test of ASTM- D86. Further in contradiction to the prescribed temperature below 5/10◦ centigrade, as stated above, in answer to question no. 56 Shri. Dilip Mehta replied that the sample was cooled to 25 degree centigrade before commencing distillation. Further in answer to question no. 13 that whether the method of laboratory test carried out was mentioned in the report or not, Shri. Dilip Mehta replied that it is not mentioned. Q37. In one of the test report(No. 150), you have reported the final boiling point is 223 C and you have also reported that the at the same temperature, the recovery is 69%. Please tell us what happened to balance 31%? A37. Probably, they losses. Q38. Did you record that it w....
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..... IOC Limited are also manufacturing and marketing Naphta, hence and interested party. Hence that said reports do not carry any evidentiary value. iii) Report and Letter of Reliance Industries Limited (Page 139 and 140, vol. 2 paper book) From the perusal of the covering letter it is apparent that only few tests were carried out and that too by the procedure followed for their captive samples. Further it was requested that the test results are confidential and same may kindly be used for internal purpose only. Along with the said covering letter, there is an unsigned test report and from the perusal of said covering letter, there is an unsigned test report and from the perusal of said report, it is apparent that samples were not subjected to 210◦ centigrade to ascertain the percentage by volume (including losses) which got distilled. RIL are also manufacturing and marketing Naphtha, hence an interested party. Hence that said report does not carry any evidentiary value." 5. Learned Counsel pointed out that the impugned order solely relied on the cross examination of Sh. T.K. Myelvalganan and ignores the cross examination of Shri. Dilip Mehta, Chemical Exam....
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....oners to provide Cross Examination of the Chemical Examiner. "6.5 The Chemical Examiner's report is admittedly against the imports. They have not asked for retest of the report. The submission that the Chemical Examiner should not have given the classification is relevant. The Chemical Examiner is required to give only the report on the chemical analysis conducted by him. Therefore, the suggestion about the classification should be ignored and should be considered by the adjudicating authority independently. The report of the Chemical Examiner does not indicate the method adopted by him in the analysis. Therefore, it is not clear whether the test report has been conducted as per ASTM D 86 method prescribed under Note 4 of Chapter 27. This information could been elicited during cross-examination of the chemical Examiner. Under these circumstances, the adjudicating authority ought to have permitted cross-examination of the Chemical Examiner. 7. In the light of the above, we set aside the order of the commissioner and remand the matter for de-novo consideration after permitting cross examination of the Chemical Examiner and in the light of observations made in this o....
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....seen that in response to question 37 of the cross examination the Chemical Examiner was unable to explain the losses indicated in his report. From the above it is apparent that Shri. Dilip Mehta Chemical Examiner could not confirm that the ASTM D 86 method was followed by them for testing of the samples. 12. The adjudicating authority, in these circumstances decided to offer cross examination of Shri. T.K. Myelvalganan Chemical Assistant Grade-I. He was introduced as witness in the remand proceedings by the Commissioner. The appellant has strongly objected to the introduction of fresh evidence in the shape of the cross examination of Shri. T.K. Myelvalganan Chemical Assistant Grade-I. It has been argued that the direction of Tribunal was only to allow cross examination of Chemical Examiner and not of the Chemical Assistant Grade-I. The appellant are argued that the report was signed by Chemical Examiner and not by the Chemical Assistant Grade-I. On the other hand Revenue had argued that the entire procedures and testing was done of Chemical Assistant Grade-I and not by the Chemical Examiner himself and therefore only Chemical Assistant Grade-I could have answered the question re....
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.... out to know the nature of the goods like Naphtha or otherwise, do you agree or not ? A. Yes. I agree with it. Q. Can you tell us what are the parameters in detailed hydrocarbon analysis? A. Detail analysis of carbon chains form C to C. True Boilling point, flash point, Distillation range, Paraffinic, Olefinic, Naphthenic and Aromatic, content analysis by sophisticated instruments. Q. Please tell us what is the significance of flash point for determining the nature of the goods under test? A. flash point is not an important criterion for this sample even though in our Customs tariff, there are two types of classification- one flashing below 25 degree C and another, flashing below 25 degree C. Q. What was the method used by you to determine the flash method? A. Abel Closed cup Method. Q. Which method was adopted for determining the flash point? A. IP 170/95. Q. what was the lowest temperature recorded by you? A. -30 degree C to 70 degree C in practice -5 degree C to 66.5 degree C. Q. As per your answer, if you can determine flash point as -5 degree C, why you are reporting flash point below 25 degree C? A. For classification, Customs tariff req....
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....l do the same job Q. Is it mentioned in any of the provisions of ASTM D 86 method that any particular type of thermometer is required to be used or any calibrated thermometer can be used? A. No. (usual practice). Q. Is it your usual practice to defy the rules and justify on the strength of oral answers? A. Because we follow the standard procedures as per ASTM, IP, BIS, etc. for all samples. Q. Is it that particular group under ASTM D 86 Can Be Determined Only After Determining the Reid Vapour Pressure? A. No. According to the distillation range, we used to decide the group under ASTM D 86. It is also one of the parameter to decide the group? Q. Am I right that such approach is not permissible under ASTM D 86? Yes or No? A. No. It is not correct. Q. Is it that two samples having the density of 0.7249 and that of 0.6783 would have exactly the same aromatic contents to each other? A. In both cases, the aromatic contents can be nearly same but the difference is due to the predominance of lighter hydrocarbons in the second case and moderately higher hydrocarbons in the previous case. Q. What was the method adopted by you for finding the aromatic contents....
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....support board diameter of note. A B B B C Mm 32 38 38 50 50 Temperature at start of test Flask 0-5 13-18 13-18 13-18 13-18 ◦C 32-40 55-65 55-65 55-65 55-65 ◦F Not above Not above Not above Not above Not above Flask support and shield Ambient Ambient Ambient Ambient Ambient Receiving cylinder and 100 mL Charge ◦C 0-5 13-18 13-18 13-18A 13- ambient A ◦F 32-40 55-65 55-65 55-65A 65- ambient A Summary of Test Method 4.1 Based on its composition, vapor pressure, expected PBP or expected EP, or combination thereof, the sample is placed in one of five groups. Apparatus arrangement, condenser temperature, and other operational variables are defined by the group in which the sample falls. TABLE 3 Sampling, Storage, and Sample Conditioning Group U Group 1 Group 2 Group 3 Group 4 Temperature of sample bottle C̊ <5 <10 ̊F <40 <50 &nb....