TaxTMI 
TaxTMI 
2023 (12) TMI 17
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....ntial Customs Duty amounting to Rs.33,46,770/- with applicable interest and penalty of Rs.33,46,770/- on the appellant under Section 114A of the Customs Act, 1962. 2. The brief facts are that an intelligence was received that the appellant was importing "Canned Pineapple Slices" from Philippines & Thailand and claiming exemption from Basic Customs Duty available to imports from ASEAN countries in terms of Customs Notification No. 46/2011-Cus dated 01.06.2011, as amended. However, it was alleged that the said 'Canned Pineapple Slices' are classifiable under Customs Tariff Heading No. 0804 3000 and consequently the benefits of Exemption Notification No. 46/2011- Cus dated 01.06.2011, as amended, are not available. Thereafter, the premises of the appellant was searched on 17.03.2021, in the presence of independent witnesses and Mr. Harith Budhraja, Director of the appellant. The proceedings conducted were recorded in a Panchnama dated 17.03.2021. Sh. Harith Budhraja's statement was recorded on 17.03.2021, wherein he inter-alia stated that they trade and manufacture processed fruits, vegetables and food additives etc. He stated that they had been importing pineapple for over 2 yea....
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.... was made answerable to his senior officer. The learned Counsel further contended that the extended period of limitation had been wrongly invoked since it is settled law that claiming a particular classification under a particular heading does not amount to misdeclaration. He relied on the Hon'ble Supreme Court judgement in Northern Plastic Ltd. v. CCE 1998 (101) E.L.T. 549. 4. The learned Counsel further submitted that it is settled law that extended period and penalty cannot be imposed when the Adjudicating Authority himself held in April, 2019 that the goods were liable to be classified under CTH 20082000, whereas in March, 2021 he held that the same goods were classifiable in CTH 08043000. He also submitted that the Assistant/Deputy Commissioner of Customs, Group 1, ICD Tughlakabad had opined that the goods were liable to be classified under CTH 08119010, but from March 2021, he decided that it should be in CTH 08043000. The learned counsel submitted that this is evident from the following course of events:- i) The appellant filed B/E No 6030589 dated 18.04.2018 for canned pineapple slices having CTH 20082000. ii) However, after filing the B/E, appellant had the view t....
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....ountry of Origin Certificate indicate the CTH 08119010. He further submitted that it is settled law that assessments already made cannot be changed on the basis of change of mind of an authority based on different interpretation, when all the material facts were in the knowledge of the assessing officer/ proper officer. He relied on decision of CESTAT in PSL Limited vs. Commissioner of Customs, [2015 (328) E.L.T. 177] and affirmed by the Hon'ble Supreme Court in Commissioner vs Man Industries India Ltd. [2016 (331) ELT A 90]. He contended that in PSL Limited decision, the Tribunal while considering the above cited judgment of the Hon'ble Supreme Court, had held that a declaration given with respect to classification of goods in the Bills of Entry cannot be considered as wilful mis-declaration/ suppression with intention to evade customs duty, in the absence of any other corroborative evidence. In the present case, there is no corroborative evidence brought on record by the department. Hence, the ratio of the above cited decision would apply squarely in the instant case. The learned Counsel also relied on the Tribunal's decision in Asian Rubber Works vs. Commissioner of Customs,....
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....ssess the duty payable on the goods imported by correctly classifying the same. In the instant case, the appellant had wrongly classified the goods under CTH 0811 by suppressing the fact that the goods were not frozen. This was duly admitted by the Director in his voluntary statement. Consequently, the impugned goods merit reclassification under CTH 08043000. He therefore submitted that the adjudicating authority had correctly confirmed the duty demand against the five Bills of Entry cleared during the period 2020-21, and had imposed penalty equal to the differential customs duty under the Section 114A of the Customs Act, 1962. 8. We have heard the Learned Counsel for the appellant and the Learned Authorised Representative. The issue before us is classification of canned pineapple slices. 9. We will first deal with the merits of the case, before we address other arguments of the learned counsel. Vide the show cause notice dated 15.3.22, the Department has sought to classify the Canned Pineapple Slices under Customs Tariff Heading 08043000, whereas the appellant has classified the same under CTH 08119010. To appreciate the arguments, it would be appropriate to reproduce the contes....
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....when fresh or chilled, are classified in the preceding headings of this Chapter. (As regards the meanings of the expressions " chilled " and frozen see the General Explanatory Note to this Chapter j Fruit and nuts which have been cooked by steaming or boiling in water before freezing remain classified in this heading. Frozen fruit and nuts cooked by other methods before freezing are excluded (Chapter 20). Frozen fruit and nuts to which sugar or other sweetening matter has been added are also covered by this heading, the sugar having the effect of inhibiting oxidation and thus preventing the change of colour which would otherwise occur, generally on thawing out. The products of this heading may also contain added salt." 9.1 As per the explanatory notes, it is noted that for any product to be classified under CTH 0804, they have to be fresh or dried. For fruits to be classified under CTH 0811, the said product has to be "Frozen", as elaborated above. In the instant case, the product being imported by the appellant is not frozen. This is amply clear from the statement of the Director of the appellant, wherein he submitted that the fresh fruits (Pineapple) are received, graded, wa....
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.... is sliced and the slices are filled in cans, sugar is added as a preservative, the cans are sealed under temperature and then put in boiling water for sterilisation. Is the pineapple fruit consumed in the manufacture of pineapple slices? xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx 6. In the present case, there is no essential difference between pineapple fruit and the canned pineapple slices. The dealer and the consumer regard both as pineapple. The only difference is that the sliced pineapple is a presentation of fruit in a more convenient form and by reason of being canned it is capable of storage without spoiling. The additional sweetness in the canned pineapple arises from the sugar added as a preservative. On a total impression, it seems to us, the pineapple slices must be held to possess the same identity as the original pineapple fruit." 9.3 It is important to note that the process of canning the slices as indicated above is the same as explained by the Director of the appellant. We further note that the Supreme Court in its judgment in the case of M/s Thermax Ltd Vs Commissioner of Central Excise, Pune 2022 (382) E.L.T. 442 (S.C.) has highlighted the persuas....
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....different purpose and, therefore, the specific purpose of tariff classification for which the internationally accepted nomenclature in HSN has been adopted, for enacting the Central Excise Tariff Act, 1985, must be preferred, in case of any difference between the meaning of the expression given in the HSN and the meaning of that term given in the Glossary of Terms of the ISI. xx xx xx 18. We are of the view that the Tribunal as well as the High Court fell into the error of overlooking the fact that the structure of the Central Excise Tariff is based on the internationally accepted nomenclature found in the HSN and, therefore, any dispute relating to tariff classification must, as far as possible, be resolved with reference to the nomenclature indicated by the HSN unless there be an express different intention indicated by the Central Excise Tariff Act, 1985 itself. The definition of a term in the ISI Glossary, which has a different purpose, cannot, in case of a conflict, override the clear indication of the meaning of an identical expression in the same context in the HSN. In the HSN, block board is included within the meaning of the expression "similar laminated wood" in the s....
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....y. To facilitate interpretation and classification, each of the 97 Chapters in the HSN contain corresponding Chapter Notes, General Notes, and Explanatory Notes applicable to the Headings and sub16 headings within that Chapter. In addition, there are six General Rules of Interpretation applicable to the Harmonised System as a whole. xx xx xx 12. We would, at this stage, take on record the well-settled principle that words in a taxing statute must be construed in consonance with their commonly accepted meaning in the trade and their popular meaning. When a word is not explicitly defined, or there is ambiguity as to its meaning, it must be interpreted for the purpose of classification in the popular sense, which is the sense attributed to it by those people who are conversant with the subject matter that the statute is dealing with. This principle should commend to the authorities as it is a good fiscal policy not to put people in doubt or quandary about their tax liability. The common parlance test is an extension of the general principle of interpretation of statutes for deciphering the mind of the law-maker. However, the above rule is subject to certain exceptions, for example,....
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....in Certificates issued by the Designated Committee of the Thailand Government have been questioned by the Revenue however there was no follow-up investigations carried out after the import, in order to deny the exemption benefit. Therefore, such unilateral rejection of the exemption benefits is not tenable. We are unable to accept the submission of the learned counsel. As noted supra, we find that the appellant in his statement has accepted that they have wrongly classified their product under CTH 0811 by suppressing the non-frozen character of the impugned goods, in order to avail the benefit of the Notification no 46/2011 - Cus dated 01.06.2011. We note that the Supreme Court in their decision in the case of Naresh J. Sukhawani v. Union of India, 1996 (83) E.L.T. 258 (S.C.) held that the statement made before the customs officials is not a statement recorded under Section 161 of the Cr.P.C. Therefore, such statement is a material piece of evidence collected by customs officers under Section 108 of the Customs Act. The material incriminates the petitioner in the contravention of the provisions of the Customs Act. Such material can certainly be used to connect the petitioner to the....