TaxTMI 
TaxTMI 
2024 (1) TMI 405
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.... be classified as beads it has to be pierced. It was argued that while glass beads classifiable under Heading 70181020, the chatons are classifiable under heading 70181090 in the category "others". Learned Counsel argued that Tribunal in the case of Art Beads Pvt Ltd had classified the said goods as beads. He argued that the said order was not changed by revenue and therefore is binding on revenue. He point out that in the said order the Tribunal had preferred to the HSN explanatory notes as well as letter F. No. 390/RTI/14-2011-JC dated 01.02.2011 of CBEC, wherein it was categorically stated that the said order of the Tribunal was accepted. Learned Counsel also relied on the decision of Supreme Court (2015) 321 ELT A202 (SC) in the case of M/s. VMB Impex -2015 (321) ELT 522 (Tri.) was upheld. He pointed out that in the case of VMB Impex (Supra) reliance was placed in the decision of Tribunal in the case of Art Beads Pvt Ltd-2013 (292) ELT 472. In view of above learned Counsel sought relief. 3. Learned AR relied on the impugned order. 4. We have carefully considered the rival submissions. We find that the Heading 7018 of the Custom Tariff reads as follows: 7018 Glass b....
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....efore prima facie it is appears that the HSN explanatory notes clearly limits the definition of Beads only to those items which are pierced. 4.3 On the other hand the learned Counsel has relied on the decision of M/s. VMB Impex which were upheld by Hon'ble Apex Court. It is noticed that the decision in the case of M/s. VMB Impex primarily relies on the decision of Tribunal in the case of M/s. Art Beads Pvt Ltd (Supra) and on the case of Starlite Corporation (supra). In the said decision there is no discussion whatsoever on the HSN notes. It would appear that the HSN note were not brought to the knowledge of the Tribunal and therefore could not come to the attention of Hon'ble Apex Court. The decision in the case of M/s. Starlite corporation (Bom.) reported under 1989 (39) ELT 538 (Bom.) was for a period which was prior to introduction of the new Custom Tariff based on HSN notes. In the said decision reliance was placed on ISI specification to hold that piercing is not a necessary requirement for an items to be a beads. It would therefore appear that the facts in the case of M/s. Starlite were different in so much as it was dealing with the different custom tariff, wherein no defin....
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....em would bring about considerable alignment, between the Customs and Central Excise Tariffs, which in turn, would facilitate charging of additional customs duty on imports, equivalent of excise duty. It was therefore expressly stated in the Statement of Objects and Reasons that the Central Excise Tariff are based on the HSN and the internationally accepted nomenclature was as such taken into account, to reduce tariff classification disputes. Thus, it was suggested that a safe guide for classification is the internationally accepted nomenclature emerging from the HSN and in case of doubt, the HSN should be chosen advisory for ascertaining the true meaning of any expression used in the Tariff Act. In Wood Craft (supra), in the opinion written by Justice J.S. Verma, the following was pertinently opined in this context: "12. ... .. Accordingly, for resolving any dispute relating to tariff classification, a safe guide is the internationally accepted nomenclature emerging from the HSN. This being the expressly acknowledged basis of the structure of Central Excise Tariff in the Act and the tariff classification made therein, in case of any doubt the HSN is a safe guide for ascertaining ....
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....oduct nomenclature harmonises description, classification, and coding of goods. While the primary objective of the HSN is to facilitate and aid trade, the Code is also extensively used by governments, international organisations, and the private sector for other diverse purposes like internal taxes, monitoring import tariffs, quota controls, rules of origin, transport statistics, freight tariffs, compilation of national accounts, and economic research and analysis. In the present times, given the widespread adoption of the Harmonised System by over 200 countries, it would be extremely difficult to deal with an international trade issue involving commodities, without adverting to the Harmonised System. The Code is the bedrock of custom controls and procedures. The HSN consists of over 5000 commodities groups, which are structured into 21 Sections and 97 Chapters, which are further divided into four and six digit sub-headings. Many custom administrations, like India, use an eight or more digit commodity coding system, with the first six digits being the HSN code. 10. Classification under the Harmonised System is done by placing the goods under the most apt and fitting sub-heading. ....