AI Drafter 
TaxTMI 
TaxTMI 
2024 (4) TMI 81
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....to 'QUICKLIME, SLAKED LIME AND HYDRAULIC LIME, OTHER THAN CALCIUM OXIDE AND HYDROXIDE OF HEADING 2825' corresponding to heading 2522 of First Schedule to Customs Tariff Act, 1975 was brought to bear as being more appropriate to declaration in bills of entry by customs authorities to initiate proceedings against them. 2. Impliedly, 'calcium oxide' and 'calcium hydroxide' are also, one way or the other, variety of 'lime' but from unalloyed comprehension of the more sophisticated description as 'HYDRAZINE AND HYDROXYLAMINE AND THEIR INORGANIC SALTS; OTHER INORGANIC BASES; OTHER METAL OXIDES, HYDROXIDES AND PEROXIDES' in heading 2825 of First Schedule to Customs Tariff Act, 1975, and even if not specifically included therein, customs authorities have taken recourse, and inappropriately, to the headings of the two chapters, to confirm recovery therein under section 28 of Customs Act, 1962. And it is that happenstance 'cross-over', compounded by distinguishment in tax policy, that perpetuates the dispute over Rs. 1,49,50,442/- in order [order-in-original no. 105/2022-23/Commr/NS-I/CAC/JNCH dated 23rd March 2023] of Commissioner of Customs (NS-I), JNCH, Nhava Sh....
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....n of precipitated calcium carbonate' which was essential for change in classification, was derogated as incorrect by Learned Authorized Representative referring to expression 'such as', in the Explanatory Notes not excluding other process to achieve the same end. 5. Learned Counsel relied upon the decision of the Tribunal in Jindal Stainless (Hissar) Ltd v. Commissioner of Customs, New Delhi which, in final order [no. A/50751/2020 dated 25th August 2020], disposing off appeal [customs appeal no. 51224 of 2019] against order [order-in-original no. 20-21/COMMR/SVS/ICD/PPG/2018 dated 31st December 2018] of Commissioner of Customs, ICD, New Delhi, held that '4.3 It is seen that the decision of Tribunal in the case of Bhadradari Minerals Pvt. Ltd. (supra) has been rendered in practically identical circumstances. The said decision relies on the HSN explanatory notes 11 under chapter heading 2825. The said chapter note provides as follows: "5.3 HSN Explanatory Note under Tariff Heading 28.25 also excludes Calcium Oxide which has a purity less than 98% from Chapter 28 in view of the fact that what is covered under 28.25 is Calcium Oxide of purity 98%. The relevant Chap....
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....falling there under. In order to closely examine the scope of contending Chapter, Headings, Sub-headings and Tariff Items thereof for determining correct classification of imported goods, relevant tariff entries in the First Schedule to the Customs Tariff Act are extracted as below: xxxxx 10.1 ........ Further, it can be said that Chapter heading 2522, clearly provides that quicklime, slaked lime and hydraulic lime are classifiable under specific tariff items provided for therein; however, calcium oxide and hydroxide of Chapter heading 2825 are excluded from the scope of coverage under the heading 2522. Similarly, the description of the Chapter heading 2825 provide for coverage of the goods under its scope which are specifically mentioned as Hydrazine and hydroxylamine and their inorganic salts; other inorganic bases; other metal oxides, hydroxides and peroxides. However, if any inorganic basis or metal oxides, hydroxides and peroxides which are not specifically mentioned therein by a specific tariff entry, then they will be classified under "other" category in sub-heading 2825 90. 10.2 ....... Hence, in simple words, it can be stated that all the goods covered....
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....national trade and is duly adopted by all member countries to WCO, and India being a member country, we need to look into these aspects too. It is also important to note that classification of goods for customs purposes as per the Harmonized System of Nomenclature (HSN) is an international obligation for India under an International Convention on the Harmonized Commodity Description and Coding System brought into effect from 01.01.1988 and among the various uses, one of it relevant to this case before us to follow the HSN as a basis for Customs tariffs and as a vital element of core Customs process areas of Customs controls and procedures, including risk assessment, information technology and compliance. Accordingly, the extract of relevant Chapter notes in First Schedule to Customs Tariff Act and the WCO's HSN in respect of heading 2522 and 2825 is discussed in detail along with extracted portion of the same as given below: xxxxxxx 12.2 ........ Further, as the description of sub-heading 2522 itself provide for excluding calcium oxide and hydroxide of Chapter heading 2825 from the scope of its coverage as discussed in detail at paragraphs 10.1 to 10.3 above, there aris....
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....cts non excisable, if, they fall in other Chapters or under other Headings, appropriate action may be considered by the Government. In fact, Tariff sub-heading 2505.60 which mentions quick lime, slaked lime and hydraulic lime refers to such goods other than calcium oxide and hydroxide of Heading No. 28.25 which would point to the latter two products falling under that heading which covers, inter alia, inorganic chemicals, that chapter itself falling in Section VI which covers products of the Chemical or Allied Industries. As against this, Chapter 25 under which, lime falls is in Section V which covers mineral products. Chapter Note 2 under Chapter 25 covers only material falling under 25.01, 25.03 and 25.05 which have been subjected to mechanical or physical processes for eliminating impurities without changing the structure of the product but not products that have been roasted, calcined etc. Obviously the latter type of processes result in a chemical process changing the structure of the product. It is be noted that the Supreme Court did not disturb the findings of the Tribunal while dismissing the department's appeal as the Counsel for the Government could not enlighten the Cour....
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....o not find fitment in heading 2522 of the First Schedule to Customs Tariff Act, 1975 or that the 'integrated tax' rate at serial no. 131 of Schedule I is, by the corresponding description, unquestionably excluded from every tariff item comprising heading 2522 of the First Schedule to Customs Tariff Act, 1975. Nor is it the case of Revenue that the 'quicklime' at serial no. 131 of Schedule I of the 'integrated tax' rate notification do not find placement in chapter 25 of First Schedule to the Customs Tariff Act, 1975. Thus, we find that the impugned order dated 31.10.2019 rejecting the exemption benefit of the above notification, is not legally sustainable. 16. We further find from the standards prescribed by the Bureau of Indian Standards (BIS) in respect of IS:1540 (Part-I):1980 providing the 'specification for Quick lime and Hydrated lime for chemical industries' state in its scope of coverage of the BIS that this standard does not cover lime for the metallurgical industry, besides excluding its scope for other uses such as building, agricultural, glass and ceramic industries. .......... Thus, we find that the IS:1540 is not applicable for the quicklime used in the manuf....