TaxTMI 
TaxTMI 
2023 (8) TMI 1242
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....June 2016, besides imposing fine of Rs. 15,00,00,000 under section 125 of Customs Act, 1962 along with penalty of Rs. 15,00,00,000 under section 114A of Customs Act, 1962 and imposition of personal penalty of Rs. 1,50,00,000 on the individual appellant herein, is the appropriateness of classification against tariff item 2601 11 50 of schedule to Central Excise Tariff Act, 1985 for assessment to 'additional duty of customs' under section 3(1) of Customs Tariff Act, 1975 on the imports. According to Learned Counsel for appellant, the impugned order disposed off two notices issued to the appellant-company herein as well as M/s Amba River Coke Ltd, a sister-concern of the group, and the appeal of the latter, carried to the Tribunal, settled the dispute in favour of the declared classification in Amba River Coke Limited v. Principal Commissioner of Customs (Preventive), Mumbai vide order [final order no. A/85506/2022 in customs appeal no. 85365 of 20117] dated 3rd June 2022 2. The appellant imported the impugned goods, viz., 'iron ore Carajas Sohar (iron ore fines)' valued at Rs. 110,15,74, 367 and an essential raw material in manufacture of 'iron ore pellets' by them, from M/s Vale In....
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....description, source and use of the impugned goods; the issue having been decided in favour of the importer upon challenge of the order, insofar as detrimental to them, from the latter, there would be no reason not to dispose of the dispute of the appellant herein in like manner. That would be in accordance with the principle of judicial consistency and judicial constancy that is the hallmark of judicial discipline. Nonetheless, Revenue is in appeal against the order of the Tribunal supra in re Amba River Coke Ltd and it is the plea of Learned Special Counsel for Revenue that the grounds preferred before the Hon'ble Supreme Court, to the extent of Tribunal having disregarded specific reasoning adopted by the adjudicating authority, should be considered by us. Such an exercise may have legal sanctity only if, and within the circumscribing set out by the Hon'ble Supreme Court in Union of India and anr v. Paras Laminates (P) Ltd [1991 AIR 696], resort is to be had to reference to the Hon'ble President for constitution of Larger Bench. 4. The plea of Learned Special Counsel for Revenue is extraordinary, and most especially, as one of us was a constituent of the bench that rendere....
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....shwar-I [2016-TIOl-744-CESTAT-KOL]. 6. It is common ground that the decision of the Tribunal in re Amba River Coke Ltd has, consequent upon challenge of the very same order impugned in this appeal, reversed the classification of the impugned goods adopted by the adjudicating authority and allowed the benefit of exemption notification. In the context of submissions made before us by Learned Special Counsel we are, therefore, only required to consider if the Tribunal had, in that precedent decision, overlooked any fact or law that would have materially altered the outcome. Failure to appreciate a standpoint, as argued by Learned Special Counsel, does not, of itself, constitute distinguishment that may overcome stare decisis or justify disregard of cited precedent. That remit is now addressed by us. 7. To begin with, note 4 in chapter 26 of schedule to Central Excise Tariff Act, 1985 is specific to levy of duty of central excise and is intended solely upon manufacture, in a broader context, as 'taxable event' under the authority of section 3 of Central Excise Act, 1944 read with section 2(f)(ii) therein. According to Learned Special Counsel, the adjudicating authority had held....
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....special treatment has been undertaken on the 'ore' so as to remove part or whole of the foreign matter, it would not be considered as a 'concentrate'. xxxx 21. The show cause notice, in Paragraph 18, has explained that foreign matter like alumina and silica contained in the ore, being the gangue, is required to be removed from the ore, and this process is called beneficiation. The relevant extract arising from Paragraph 18 of the notice reads as follows : "Beneficiation is a process, which removes the gangue particle, like alumina and silica etc. from the iron ore. Basically it separates Fe2O3 or Fe3O4 from other impurities in the iron ore. In this process, the iron content is improved to the maximum possible extent. The highest can be 70%, i.e. the possible purest form". 22. What needs to be noticed is that the Supreme Court in National Minerals Development Corporation held, after referring to the dictionary/technical material that 'concentrate' consists of enriched ore segregated from waste in a concentration plant. xxxxx 24. It is, thus, evident from the HSN Explanatory Notes as also from the judgment of the Supreme Court and the dictionary meanings relied upon therei....
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....e, it is clarified that the levy of excise duty is attracted only in cases where the product meets the definition of concentrate as per HSN Notes, that is, 'ores which have had part or all of the foreign matter removed by special treatments either because such foreign matter may hamper subsequent metallurgical operations or with a view to economical transport'. 4. The above position may be brought to the notice of Commissioners under your charge so that pending disputes, if any, may be decided accordingly." 26. The aforesaid Circular clarifies that crushing and screening are mere preparatory processes and do not constitute the special treatment contemplated in the Explanatory Notes, by which part or all of the foreign matter is removed. In other words, it has been clarified that ores that have been merely subjected to the processes of crushing and screening, cannot be said to have been concentrated, as the said processes do not result in removal of part or whole of the foreign matter. It has been explained that crushing and screening followed with processes such as milling, hydraulic separation, magnetic separation, floatation and concentrate thickening have to be undertaken ....
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....tter and, therefore, the same cannot be said to be a special treatment resulting in the ore becoming a concentrate. This apart, the blend of iron ore fines (90-95%) with iron ore concentrate (5-10%) would, by applying Note 3(b) to the General Rules of Interpretation to the Import Tariff, be classified as iron ore fines, as the essential character to the mixture is derived from the iron ore fines. The processes to which the imported iron ore fines have been subjected to, such as crushing, screening, and physical blending/mixing, are not processes by which gangue is separated from the mineral ore. It is only when the process of crushing and screening are followed with the process of milling and thereafter hydraulic separation, magnetic separation, floatation and concentrate thickening that the ore can be said to have been concentrated. 30. The impugned order, however, holds that Vale International was using water for removal of impurities. This finding has been arrived at by an incorrect extrapolation of the pictorial representation in the impugned order. It needs to be noted that the show cause notice had not made any reference to the aforesaid pictorial extract from the website.....
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.... to concentrating an ore, as there is no special treatment involved in the same and that it is only through the additional process of milling, hydraulic separation, magnetic separation, floatation and concentrate thickening that a part or whole of the foreign matter is removed, so as to concentrate an ore. Even the process of blending does not result in removal in any of part or whole of the foreign matter, so as to tantamount to concentrating the ore. The report dated 6-5-2016 of Dr. Rathod cannot be relied upon. Iron ore, being a naturally occurring product, the composition thereof as also the composition of the gangue associated with the same varies from mine to mine, location to location, region to region. There can be no basis to impute any certainty that alumina to silica ratio would always be greater than 1 in case of natural ores. The appellant had, in the reply, demonstrated that naturally occurring high grade iron ores, even in India at the Bacheli and Bailadila of NMDC have the alumina to silica ratio less than 1. The impugned order as also the evidence relied in support of the same have not disputed this position. The report of Dr. Rathod could not, therefore, have been....