TaxTMI 
TaxTMI 
2025 (11) TMI 137
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....e confirmed demand of differential duty of Rs. 2'15'09'182/- with respect to 20 Bills of Entry filed by the appellant during 2018-2019 along with interest and penalties. The details of the three appeals are given below :- I. Appeal No. : C/55311 of 2023 Order-in-Original No. 04/COMMR/VC/Leakless Gasket/ICDPPG/2022-23 dated 28.12.2022 Bills of Entry : 20 Bills of Entry (2018-2019) Amount Involved : Duty - Rs. 2'15'09'182/- Interest - Rs. 39'75'280/- Penalty - Rs. 2'15'09'182/- II. Appeal No. : C/51887 of 2021 Order-in-Original No. DLI/CUSTM/PREV/DM/ADC/309/2020 dated 18.03.2020 Order-in-Appeal No. CC (A) CUS/D-II/Prev./NCH/666-667/ 2021-22 dated 09/08/2021 Bills of Entry : 6375354 dated 07.01.2020 Amount Involved : Duty - Rs. 11'29'899/- (approx.) Penalty - Rs. 11'29'899/- III. Appeal No. : C/51904 of 2021 Order-in-Original No. DLI/CUSTM/PREV/DM/ADC/301/2020 dated 06.03.2020 Order-in-Appeal No. CC (A) CUS/D-II/Prev./NCH/666-667/ 2021-22 dated 09/08/2021 Bills of Entry : 6775152 dated 06.02.2020 Amount Involved : Duty - Rs. 11'30'604/- (Includes voluntarily paid intere....
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....parate show cause notices dated 02.07.2021' 24.11.2021 and 22.12.2021 along with corrigendum dated 24.11.2022 were decided by the Commissioner of Customs (ICD' Patparganj) by order dated 28.12.2022 confirming the demand of Rs. 2'15'09'182/- under section 28 (4) of the Act covering 22 Bills of Entry. She also held the goods worth Rs. 17'33'79'588/- liable to confiscation under section 111 (m)' but did not confiscate them as they were not available. She confirmed the demand of interest under section 28AA on the differential duty and imposed penalty equal to the amount of the differential duty under section 114A of the Act. Submissions on behalf of the appellant :- 8. Learned counsels for the appellant made the following submissions in respect of Customs Appeal No. 55311 of 2023:- (a) The impugned order is improper and illegal as it did not consider the appellant's submissions ; (b) Twaron is the brand name and the product is Para Aramid Pulp which is a raw material specifically engineered to make non-asbestos gasket jointing sheets. In the absence of any statutory definition' the functional character of a product must guide its classification. Since Twaron par....
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.... (a) The impugned order of the Commissioner of Customs (Appeals) is improper and illegal. (b) The appellant imported Twaron Para Aramid Pulp and it cannot be classified as Flock. The Commissioner (Appeals) erred in upholding the order of Additional Commissioner and rejecting the appellant's appeal. The goods cannot be classified under CTI 57601 30 00. The onus of classification lies on the department. Confiscation of the goods and of redemption fine is not voluntarily. Submissions on behalf of the Department:- 9. Learned authorized representative vehemently supported the impugned orders and made the following submissions :- (a) The appellant classified the good under CTI 5601 22 00 (as wadding of man-made fibres) but it deserves to be classified under CTI 5601 30 00 (textile flock and dust and mill neps) based on the fibre length and physical charactertics. The goods were imported by the appellant and as per the test report which the appellant had submitted along with the Bill of Entry' the goods consist of less than 5 mm yellowish cotton fibre. (b) As per HSN explanatory notes to heading' 5601 Textile Flock consists of very high fibres using cot....
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....he appellant in Customs Appeals No. 51887/2021 and 51904/2021. Classification 12. The relevant portion of the Customs Tariff covering the two competing entries is as follows: 5601 WADDING OF TEXTILE MATERIALS AND ARTICLES THEREOF; TEXTILE FIBRES' NOT EXCEEDING 5 MM IN LENGTH (FLOCK)' TEXTILE DUST AND MILL NEP 5601 21 -Wadding of textile materials and articles thereof -- Of cotton : 5601 21 10 --- Absorbent cotton wool 5601 21 90 --- Other 5601 22 00 --- Of man-made fibres 5601 29 00 --- Other 5601 30 00 -- Textile flock and dust and mill neps 13. The relevant portion of the General Explanatory Notes to Import Tariff is as follows: "Where in column (2) of this Schedule' the description of an article or group of articles under a heading is preceded by "-"' the said article or group of articles shall be taken to be a sub-classification of the article or group of articles covered by the said heading. Where' however' the description of an article or group of articles is preceded by "- -"' the said article or group of articles shall be taken to be a sub-classification of the immediately preceding descrip....
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....ading also covers wadding in the piece or cut to length' and articles of wadding other than those covered more specifically by other headings of the Nomenclature (see exclusions below). 56.01 The articles of wadding classified here include: (1) Window' door or similar draught excluders consisting of rolls of wadding spirally covered with yams' but excluding those completely covered with textile' fabric (heading 6307). (2) Articles of wadding used for decoration' other than those having the character of articles of Chapter 95. Among the articles of wadding not classified here are: (a) Wadding or articles of wadding' impregnated or coated with pharmaceutical substances' or put up in forms or packings for retail sale for medical' surgical' dental or veterinary purposes (heading 30.05) (b) Wadding' impregnated' coated or covered with substances or preparations (e.g. perfumes or cosmetics (Chapter-33) soaps or detergents (heading 34.01)' polishes' creams or similar preparations (heading 34.05)' fabric softeners (heading 38.09) where the textile material is present merely as a carrying medium. (c) Cellulose wadding and articl....
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.... and are of short fiber length. They are described as 'Fibrillated fibres for general application in dry friction materials and calendered gaskets' and the intended end uses of the gaskets were described as 'Calendered gaskets are used to seal flange connections in pipelines.' 16. It is undisputed that the appellant used the imported pulp to make gaskets. The imported goods were' as per the description in the literature of the manufacturer' fibrillated fibres intended to manufacture gaskets. They were not described as textile wadding. Wadding' as indicated in the HSN explanatory notes' is a flexible spongy' high-bulk sheet of even thickness. It is said to be largely used for padding such as shoulder pads' interlinings in clothing' for sanitary use' etc. The CTI 5601 22 00 claimed by the appellant is a sub-set of single dash (-) under CTH 5601 which reads as 'Wadding of textile materials and articles thereof'. Nothing in the literature of the product produced by the appellant shows that the imported goods are 'wadding'; it was sold as 'pulp' and the intended use was also not of wadding but of the textile pulp. 17. The CTI 5601 30 00 under which the goods were classified by the....