TaxTMI 
TaxTMI 
2024 (8) TMI 911
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....RI, Pune had intercepted the said imported consignments in four containers by putting these goods on hold on the reasonable belief that the said goods were mis-declared for 'Diesel oil', which is restricted for import. Accordingly, representative samples were drawn from the said goods under panchanama proceedings dated 19-4-2022 and were sent for chemical testing to Central Excise and Customs Laboratory, Vododara, to ascertain whether the said goods were 'fuel oil' as declared by the appellants or 'diesel oil'. Upon testing the goods, it was found that the imported goods are not diesel, and accordingly DRI had withdrawn the embargo on the said goods and allowed the same for further clearance by the jurisdictional customs authorities. However, JNCH customs authorities had raised an objection regarding the goods treating the same as hazardous substance and thereby treating the said imports as being prohibited under the provisions of Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008. 2.2 The appellants by their letter dated 11-7-2022 had requested to release of goods covered under B/Es No. 8110603, dated 1-4-2022 and No. 8169028, dated 6-4-2022, as the ....
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.... reported. The very fact that imported goods conform to the IS standards would rule out the possibility that these being a hazardous waste. Thus they claimed that the imported goods fulfilled the conditions of IS standards, and these are not prohibited for import. Further they also emphasized that in none of the test reports, the imported goods have been mentioned as a 'hazardous waste'. Learned Advocate also submitted that the density limits specified in Appendix-I to the C.B.I. & C. Circular dated 4-6-2001, is not a condition for determining the classification of a hazardous waste, but is only a criterion for determining whether the fuel oil can be re-refined or not. The contention that fuel oil is to be considered as hazardous waste merely because the density exceeds 0.95% is factually erroneous, as commercially available fuel oil supplied by leading suppliers such as Indian Oil Corporation Ltd., Reliance Industries Ltd., Mangalore refinery all have density above 0.95%. On the basis of above facts, Learned Advocate submitted that confiscation of the imported goods and imposition of penalty on the appellants is clearly unsustainable in law. Hence he prayed for setting aside the i....
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....of such goods as determined in accordance with the provisions of this Act and the Customs Tariff Act; (c) exemption or concession of duty, tax, cess or any other sum, consequent upon any notification issued therefor under this Act or under the Customs Tariff Act or under any other law for the time being in force; (d) the quantity, weight, volume, measurement or other specifics where such duty, tax, cess or any other sum is leviable on the basis of the quantity, weight, volume, measurement or other specifics of such goods; (e) the origin of such goods determined in accordance with the provisions of the Customs Tariff Act or the rules made thereunder, if the amount of duty, tax, cess or any other sum is affected by the origin of such goods; (f) any other specific factor which affects the duty, tax, cess or any other sum payable on such goods, and includes provisional assessment, self-assessment, re-assessment and any assessment in which the duty assessed is nil; Section 17. Assessment of duty. - (1) An importer entering any import....
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....I MZU Letter F. No. DRI/MZU/PURU/GLKS/169/2022, dated 17-6-2022. These details have been clearly recorded in the order of the original authority at paragraph No. 3.5. From the perusal of the above details, it transpires that the imported goods were allowed for clearance by DRI, after being clarified that the same are not 'diesel' whose imports are prohibited. Thus the jurisdictional customs authorities were required to follow the extant legal provisions for clearance of imported goods. We are not examining about the aspect of whether the proper officer had at the time of assessment of the imported goods required the testing of the imported goods for the purpose of assessment and whether the proper officer had drawn the samples of imported goods, inasmuch as neither the appellants nor the Revenue had raised this issue as dispute and both of them have accepted the testing of representative samples of imported goods, which were initially drawn by DRI, Pune and later the same test results were used by the assessing officers and original as well as appellate authorities in deciding the issues in dispute. 6.4 In this regard we also find that the Central Board of Indirect Taxes and Cus....
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....o certain minimum screening tests for acidity, ash contents, sediment and water to consider whether any imported product is a regular grade furnace oil or fuel oil and these should be classified as off-specification furnace oil or waste oil. The prescribed limits being as follows :- S. No. Test Prescribed Limit (Max.) 1. Acidity (inorganic) Nil 2. Ash Content 0.1% 3. Sediment 0.25% 4. Water 1% 2. Products/furnace oil which fail the screening test should be classified as off specification furnace oil/waste oil. 3. Products/furnace oil which pass the above screening test should be subject to further testing for the remaining BIS specifications. The products should be first tested for viscosity. Products/furnace oil which has a viscosity greater than 370 centistokes at 50 degree centigrade should be classified as off specification furnace oil/waste oil. 4. Products/furnace oil of viscosity below 370 centistokes should be categorized into the following four grades of fuel oils : (1) Viscosity upto 80 centistokes (Grade IV), (2) Viscosity 80 to 125 centistokes (Grade MV 1), (3) Viscosity 125 to 180 centistokes (Grad....
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....furnace oil indicating presence of organic halide should be tested for PCBs. (iii) Samples testing negative for PCBs but showing presence of organic halides should be tested for heavy metals. Samples confirming to heavy metal concentration listed in Appendix I could be re-refined. Those not meeting the specifications laid down for heavy metals should be classified as hazardous waste. 10. Samples testing positive for organic halides and PCBs should be classified as hazardous waste. The above procedure may be brought to the notice of all concerned for compliance. Board's Circular No. 106, dated 22-12-2000 stands modified to the above extent. Difficulties, if any, in following above procedure may be brought to the notice of the Board. Please acknowledge receipt. APPENDIX-1 Used Oil Specification for Re-refining Constituents/Property Acceptable Limits (Max.) Colour 8 Water 15% Density 0.85 to 0.95% Flash point COC Min. 94 Degree Centigrade Kinematic Viscosity c St at 100 degree centigrades grades 1.0 to 32 Dilutents 15% Vol. Neutralization No. 3.5 mg KOH/g Saponification value 18....
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....below for ease of reference : Guidelines for re-testing of samples : "Circular No. 30/2017-Cus., dated 18-7-2017 F. No. 450/15/2017-Cus. IV Government of India Ministry of Finance (Department of Revenue) Central Board of Excise & Customs, New Delhi Subject : Detailed guidelines for re-testing of samples - Regarding. World Trade Organization (WTO) negotiated Trade Facilitation Agreement (TFA), which aims at simplifying the trade processes and bringing down barriers to trade has come into force w.e.f. 22nd February, 2017. India is a signatory to this agreement. 2. India has placed a number of trade related measures negotiated under the TFA in Category A. Article 5.3.1 envisages granting an opportunity for a second test in case the first test result of a sample taken upon arrival of goods declared for importation shows an adverse finding. Further Article 5.3.3 makes it obligatory to consider the result of the second test, if any, for the release and clearance of goods, and, if appropriate, may accept the results of such test. The aforementioned Articles have been placed in category A. In order to....
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....he re-test, the competent authority shall take the decision relying upon either of the tests specifying the grounds in writing for the decision so taken. In case the competent authority is unable to decide whether to rely upon the first or the re-test results, then it may order a second re-test provided the consignment is still within the customs control. However, this option should not be resorted to in every case of variation between the first test and re-test results. (g) The facility of re-testing, is a trade facilitation measure, which should generally not be denied in the ordinary course. However, there might arise circumstances where the customs officer is constrained to deny the re-testing facility. Board expects that such denial would be occasional and on reasonable grounds to be recorded in writing. (h) Where the re-testing procedure is done at the instance of the department instead of the importer, the above procedure shall be followed mutatis mutandis. 3. Difficulties, if any, in implementation of this circular, should be brought to the notice of the Board." 6.6 We also find that the Hazardous....
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.... 2. Lead 100 ppm 3. Arsenic 5 ppm 4. Cadmium+Chromium+Nickel 500 ppm 5. Polyaromatic hydrocarbons(PAH) 6% 6. Total halogents 4000 ppm 7. Polychlorinated biphenyls (PCBs) <2 ppm * 8. Sulphur 4.5% 9. Water Content 1% * The detection limit is 2 ppm by gas Liquid Chromatography (GLC) using Electron Capture detector (ECD)" 6.7 The representative samples drawn under panchanama proceedings dated 19-4-2022 by DRI, Pune Regional Unit and sent to Central Excise & Customs Laboratory (CRCL), Vadodara was tested by them and the results were sent back duly addressed to the person who submitted the samples viz., Office of the Deputy Commissioner, DRI, Pune Regional Unit, Pune. In its initial Test Report for all 28 samples, which inter alia include the 12 disputed cases, CRCL had sent their individual Test Result reports vide RCL 253 to 256, 260, all dated 20-5-2022; RCL 257 to 259, 261 to 264, all dated 23-5-2022 to DRI, Pune. The individual parameters as per the requirements for Fuel Oil in terms of BIS standards IS 1593:2018 were given individually for each of these samples. These reports also provided with an indicat....
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....Calorific Value Gross, kcal/kg Density at 15ºC g/cm^3 PAH % mg/kg PCB mg/kg Lead (Pb) mg/kg Chromium Cadmium Nickel mg/kg Arsenic (As) mg/kg (9) (10) (11) (12) (13) (14) (15) (16) (17) 4.5 66 To be reported To be reported - - - - - 0.0024 96.5 8818 1.0844 0.68 ND ND ND ND 0.0016 101.5 8800 1.0848 0.35 ND ND ND ND 0.0023 102.5 8789 1.0854 0.74 ND ND ND ND 0.0014 103.5 8792 1.0854 0.06 ND ND ND ND 0.0079 98.0 8788 1.0839 0.019 ND ND ND ND 0.0203 98.0 8812 1.0841 0.28 ND ND ND ND 0.0088 98.0 8797 1.0838 0.19 ND ND ND ND 0.0033 106.5 8784 1.0861 23.45 ND ND ND ND 0.0004 99.0 8790 1.0838 1.05 ND ND ND ND 0.0080 99.0 8789 1.0838 0.68 ND ND ND ND 0.0156 98.0 8758 1.0840 0.39 ND ND ND ND 0.0212 99.0 8759 1.0838 0.72 ND ND ND ND From a quick look at the test results in....
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....long with copy of Maharashtra Pollution Control Board (MCB) registration Certificate. In view of the same I find that the goods covered under Bills of Entry Nos. 8110603, dated 1-4-2022 and 8169028, dated 6-4-2022 may be released. 7. I find that as per final test report dated 6-6-2022 goods covered under BE Nos. 8066788, dated 30-3-2022 and 8066761, dated 30-3-2022 are not found fit for re-refining. Therefore, I find that the goods under BE Nos. 8066788, dated 30-3-2022 and 8066761, dated 30-3-2022 falls under the category of hazardous waste as per Board Circular 33/2001-Cus., dated 4-6-2001. Accordingly, they cannot be released for home consumption. 8. I find that the importer has requested for re-testing of goods covered under BE Nos. 8066788, dated 30-3-2022 and 8066761, dated 30-3-2022, I find that as per Board Circular No. 30/2017-Cus., dated 18-7-2017 request for a re-test is to be made within a period of ten days from the receipt of the communication of the test results of the first test. However, the importer has not made request for re-test as per time limit of Board Circular. Further, they have not given any reasons for delay. Accordingly, I reject their....
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....fit for re-refining. Thus, it obviously falls under the category of hazardous waste and cannot be allowed for home consumption. xx xx xx 6.6 The appellant has contended that in the final test report it is not concluded that samples having Lab Sr. No. 252 to 264 are hazardous waste, but still the OA has concluded without any basis that the goods are hazardous waste. The issue has been discussed in earlier para and hence, needs no further deliberation. 6.7 The appellant has also contended that their request for re-testing of the impugned goods was rejected by the OA on the ground that request for re-test was not made in time as per the time limit in Board Circular, but, there is no mention of any time limit for request for re-test in the Board Circular No. 33/2001-Cus., dated 4-6-2001 and the OA has not mentioned the number of the Board Circular being referred if it is other than the Board Circular No. 33/2001-Cus., dated 4-6-2001. I find that this issue has been squarely dealt with in Para 8 of the impugned order with mention of the specific Circular number on the issue of detailed gui....
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....-Cus (F. No. 405/09/2000-Cus. III), which means that the concerned goods are not fit for re-refining. Officials of Central Excise & Customs Laboratory, Vadodara are experts in their field and after testing the samples they have given their expert opinion and I do not find any reason to disagree with the findings of the said report. 7. In view of the above discussions and findings, I am of the considered view that there is no infirmity in the impugned Order-in-Original No. 406/2022-23/JC/Gr.I&1A/NC-I/CAC/JNCH, dated 29-7-2022 passed by the OA and hence I uphold the same and reject the appeal filed by the appellant M/s. G.L. Khanna & Sons as I find it devoid of any merit." We find that the authorities below did not examine the various parameters for determination of the issue of classifying the imported goods as off-specification furnace oil/waste oil or hazardous waste in a systematic and detailed manner. Rather they simply went by the wordings mentioned in the test reports, without referring to the specific factors. The test report of CRCL dated 6-6-2022 for these 12 samples state as below : "RCL/AZU/DRI/253 to 264 do not meet the requirement in respect of the ....
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....s of the said Article and CBI&C instructions in Circular No. 30/2017-Customs, dated 18-7-2017, an opportunity for a second test in case the first test result of a sample taken upon arrival of goods declared for importation shows an adverse finding, should be given by the Customs authorities. CBI&C had also provided that in such cases, the importer or his agent who intends to request the Additional/Joint Commissioner for a re-test, then he shall submit a request for re-testing in writing to the said officer within a period of ten days from the receipt of the communication of the test results of the first test. Further, such CBI&C circular also provide that the Customs officers may take a reasoned view in case the importer or his authorised agent/representative Customs Broker is unable to do so for reasons beyond his control. 8.3 It is on record that the test results have been sent by CRCL vide its letter dated 6-6-2022 addressed to SIO, DRI, Pune Regional Unit, Pune who received it later and after finding that the imported goods are not diesel oil, had informed the jurisdictional Customs authorities for taking further action as per law for clearance of the imported goods. Such co....