TaxTMI 
TaxTMI 
2026 (6) TMI 651
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....t the Orders-in- Original passed by the Joint Commissioner of Customs, SIB (Port), Customs House, Kolkata-700001 and the appellant has also filed an another appeal against Orders-in-Original related to importation of "Mineral Hydrocarbon Oil (Other Than Transformer Oil)" under CTH 27101990 as mentioned below in Table A. Since, issue involved in all the cases are same, hence, all the aforesaid appeals are being taken together for common hearing and orders thereof. The details are as below in Table-A: TABLE-A SI. No e-File No. (CAPPL/xxxx/ 2021 or 2022) Bill of entry no. & date Description of Goods ORDER-IN-ORIGINAL No. & date 1. 2221/2021 9908502 dated 10.12.2020 Mineral Hydrocarbon Oil (Other Than Transformer Oil) under CTH 27101990 KOL/CUS/PORT/JC/SIB/41/2021 DATED 09.07.2021 2. 2304/2021 9103517 dated 08.10.2020 & 9282251 dated 22.10.2020 KOL/CUS/PORT/ JC/SIB/45/2021 DATED 20.07.2021 3. 578/2022 4180571 dated 03.06.2021 & 4665265 dated 13.07.2021 KOL/CUS/ADC/PORT/GR. 1/60/2022 DATED 28.01.2022 ....
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....e and penalty mentioned below in Table-B e-File No. Bill of Entry No. & date OIO No. KOL/CUS/JC/ ... /ADJN(PORT) /2017 & Date Redemption fine in Rs. Penalty in Rs. 2221/2021 9908502 dated 10.12.2020 KOL/CUS/PORT/JC/SIB/41/ 2021 DATED 09.07.2021 7,00,000/- 5,00,000/- 2304/2021 9103517 dated 08.10.2020 KOL/CUS/PORT/ JC/SIB/ 45/2021 DATED 20.07.2021 5,00,000/- 4,00,000/- 9282251 dated 22.10.2020 7.00,000/- 5,00,000/- 578/2022 4180571 dated 03.06.2021 KOL/CUS/ADC/PORT/GR. I/60/2022 DATED 28.01.2022 10,00,000/- 5,00,000/- 4665265 dated 13.07.2021 3.3 The order was challenged by the appellants before the ld. Commissioner (Appeals), who confirmed the order of the adjudicating authority. 3.4 Aggrieved from the said order, the appellant is before us. 4. The Id. Counsel for the appellant submits that in the appellants' own case, the issue came up before this Tribunal and this Tribunal vide its Final Order Nos.76749-76750/2024 dated 29.08.2024, held that no redemption fine and penalty are imposable on the appellant. In view of this, the impugned orders are to be set aside....
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....ed order, the Appellant- importer has filed this appeal against the imposition of penalty. The Revenue is in appeal against the setting aside of the order of the ld. adjudicating authority for re-export and allowing the goods to be cleared for home consumption. 7. Thus, we observe that the issues to be decided in both the appeals together are: (1) Whether the goods imported are appropriately classifiable under Chapter Heading 2710 1990, as 'Other' as declared by the importer or under Chapter Heading 2710 1290 as "Light oils and preparations", as claimed by the Revenue; (2) Whether the impugned order is correct in setting aside the order of re-export and in allowing the goods to be cleared for home consumption. (3) Whether the Appellant-importer is liable for imposition of penalty for violation of the provisions of the Petroleum Act, 2002. 7.1. Issue No. (1) Whether the goods imported are appropriately classifiable under Chapter Heading 2710 1990 as "Other", as declared by the importer or under Chapter Heading 2710 1290 as "Light oils and preparations", as claimed by the Revenue: With regard to classification of the impor....
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....th July, 2017, for re-testing the samples. For the sake of ready reference the contents of the said circular is extracted below: Circular: 30/2017-Cus, dated 18-Jul-2017 Samples 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, i....
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....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. 4. Hindi version of the circular will follow. 7.1.2. From the guidelines issued for re-testing of samples, we obser....
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....sake of ready reference the said Note 4 is reproduced below: "Note 4. For the purposes of sub-heading 2710 12, light oils and preparations" are those of which 90% or more by volume (including losses) distil at 210 C according to the ISO 3405 method (equivalent to the ASTM D 86 method)" 7.1.5. From the plain reading of the above definition, it is apparent that the petroleum products which get distilled by 90% or more by volume at 210℃ are 'light oils and preparations' for the purpose of Chapter 27 sub-heading 2710 12. The tests are to be conducted as per the Methods prescribed in the Note 4. We observe that none of the reports have specified exactly what percentage of the goods are distilled at 210 degrees, for meeting the requirements as specified under Chapter Note 4 of Chapter 27. The IOCL report specifies 90% distillation at 204 degree and the CRCL, New Delhi report says that more than 90% distilled at 210 degree. However, the method of testing was not declared in CRCL New Delhi report. We observe that the goods being volatile in nature, the quality of the samples deteriorate over a period of time. The test report received from the sample drawn im....
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....oods be sent to IOCL/HPCL/BPCL/IIP for identifying the specific name of the goods. The excerpts of the CRCL, Kolkata letter dated 19.02.2021 are as under :- " .... The description of the goods as "Mineral Hydrocarbon Oil was already ascertained, if required, the samples may be sent to JOCL/HPCL/BPCL/IIP Dehradun for specific name as desired and further stated that executive decision may be taken at your end." I also find that reports of CRCL (Kolkata) & IOCL (Haldia), and CRCL (Delhi) suffer from inherent contradictions, as CRCL (Kolkata) Test Reports dated 20/25/26/27.11.2020 reported that the samples (goods) do not meet the criteria of 'Light Oil and its Preparation' and IOCL has also never suggested the said goods to be falling under the same. But CRCL, Delhi categorized it to be falling under Light Oil and its Preparation. In a wider spectrum, I observe that the Test reports of CRCL, Kolkata & IOCL are probably comprise of the tests of more pure sample, thus tends to be more accurate since the Test report of CRCL, Kolkata was generated in November, 2020 and IOCL in March, 2021 but the report of CRCL, Delhi was generated in November, 2021, whic....
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....65 deg * C (iii) "petroleum Class C ^ prime prime means petroleum having a flash-point of 65 deg * C and above but below 93 deg * C On the basis of analytical observations, it is observed that the CRCL, Kolkata and IOCL report are conclusive to determine the impugned goods to be falling under "petroleum Class A ^ prime prime but report of CRCL, Delhi is inconclusive in this regard. Further, as per Chapter Note of Chapter 27 of the Customs Tariff, for the purposes of sub-heading 2710 12, "light oils and preparations" are those of which 90% or more by volume (including losses) distil at 210 deg * C according to the ISO 3405 method (equivalent to the ASTM D 86 method). In this regard, IOCL report determines that 90% distillation happens at 204 deg * C but CRCL, Delhi did not determine the temperature at which the 90% distillation takes place but report that the more than 90% recovery happens at 210 deg * C which seems to nothing but an attempt to affirm the case against the importer in the instant the case, which perceives to be a prejudiced action hampering the interest of natural justice. 7.4 As such, under the above given circumstances, I find th....
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....e impugned order is correct in setting aside the order of re-export and in allowing the goods to be cleared for home consumption or not. and (3) Whether the Appellant-importer is liable for imposition of penalty for violation of the provisions of the Petroleum Act, 2002 or not. 8.1. We observe that the Appellant-importer imported the goods in used and reusable drums having capacity of 215-225 litres. As per Rule 2(1)(xix), petroleum in bulk means petroleum contained in a tank irrespective of the quantity of petroleum contained therein. The goods imported by the Appellant-importer in drums do not fall under the ambit of 'bulk' and the same are classified as 'Other than bulk' The Appellant-importer was having a PESO license valid up to 31.12.2025 for import of 1200.KL petroleum Class A - 1050 KL in bulk, Class B - 100 KL in bulk and Class C - 50 KL in bulk and Nil for petroleum 'Other than bulk'. Thus, the department opined that the PESO license in their possession does not adequately cover the import made under the bill of entry referred above, which renders the goods liable for confiscation. For confiscation of the goods, the findings given....
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....bmits that they were not aware that they cannot import materials in drums and if they import the same in drums of capacity less than 1000 litres, then the same cannot be considered as 'bulk'. We observe that the Appellant-importer was having PESO license to import Petroleum A, B & C in bulk. In the instant case, the goods were imported in drums having capacity of 220 Litres. We observe that the Appellant-importer were having license to import and store the goods in their own name. Further, we observe that the Appellant-importer has applied for amendment in PESO license and the concerned authority vide letter dated 14.06.2022 has granted license to import the goods other than bulk in class A Petroleum. We also observe that the goods are still lying seized and after 14.06.2022 the Appellant-importer is allowed to import in non-bulk quantity also. Accordingly, we hold that there is no violation of the provisions of the Petroleum Act, 2002 and hence the confiscation and penalty imposed on the Appellant-importer does not survive. Even otherwise, confiscation under 111(d) could be made only for prohibited goods. Under Rule 3 of Petroleum Rule 2002, there were conditions for impor....