The Hyderabad bench of the Customs, Excise And Service Tax Appellate Tribunal (CESTAT)In a ruling in favour of Jindal Stainless Ltd held that “Quick Lime” Properly classifiable under Harmonized System (HS) code for quicklime ie, under Customs Tariff Item 25221000.
M/s Jindal Stainless Ltd., against Order-in-Appeal No. VIZ-CUSTM-000-APP-014-19-20 dated 29.06.2019 by which Order-in-Original No. 264/2018 dated 26.12.2018 is upheld. The issue involved in this appeal is whether “Quick Lime” imported by the appellant is to be classified under CTH 25221000 or under CTH 28259090 of the Customs Tariff Act, 1975.
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As per the Memorandum of appeal, Appellant M/s Jindal Stainless Ltd., has purchased “Quick Lime” of foreign origin and imported into India by filing various Bills of Entries (Bes). Appellant have claimed classification of their imported goods, which are “Quick Lime”, under Chapter sub-heading 25221000. Imported “Quick Lime” is having more than 90% (Calcium Oxide) and ranging between 90-92% and being obtained by calcination process of Lime stone. Department contested that the imported “Quick Lime” is classifiable under Chapter sub-heading 28259090 under “Metallic Oxide” and attract applicable rate of duty, which is higher to the rate claimed by the appellant. The appellants were served various show cause notices demanding differential duties to the Customs.
The appellant have submitted that the goods imported by them is “Quick Lime (Burnt Lime)” which is obtained by calcining industrial grade lime. Chapter sub-heading 25221000 specifically covers “Quick Lime” irrespective of the content of Calcium Oxide contained in “Quick Lime” even lime is subjected to the process of calcinations. “Quick Lime (Burnt Lime)” does not merit classification under Chapter sub-heading 28259090 as the product is not purified calcium oxide.
Assistant Commissioner passed the impugned Order and rejected the classification of import “Quick Lime” claimed by the appellant under Chapter 25221000. Being aggrieved by the Order-in-Original dated 26.12.2018, appellant have filed Appeal No. 49/2019-VCH against the Order-in-Original No. 264/2018 dated 26.12.2018 passed by Assistant Commissioner before Commissioner (Appeals), Guntur, Central Tax & Customs, Visakhapatnam.
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Appellant submitted that they are importing “Quick Lime” through different ports classifying the same under CTH 25221000. Under this classification, they were clearing their goods by paying applicable customs duties, as also they paid the differential duty along with interest under protest.
Authorised Representative (AR) appearing for the Revenue reiterated the findings recorded by Commissioner in the impugned order and stated that the appellant have imported “Quick Lime”. The imported “Quick Lime” is used by the appellant for removing impurities from steel as part of manufacturing process in their smelting plant. As the Department had noticed that the imported product was calcined product of the mined limestone and preliminary reading of Note 1 to Chapter 25 showed that the products which have been roasted or calcined, fell out of the purview of classification under Chapter 25, they resorted to reclassification of the goods. Further, the Department claimed that the Hi Cal Quicklime was a manufactured product, obtained by calcinations and did not merit classification under CTH 25221000.
A two-member bench of A.K. Jyotishi, Member (Technical) and Angad Prasad, Member (Judicial) viewed that Heading 25221000 covers within its scope and ambit, mainly of three specific goods such as the following: (i) first one i.e., “quicklime”; (ii) the second one, “slaked lime”, and (iii) third one, “hydraulic lime”. Hence, in simple words, it can be stated that all the goods covered under the above description at (i) to (iii) above would be rightly classifiable under chapter heading 25221000. There is no dispute on the fact that the imported goods in the present case are ‘quicklime’ and thus by applying GIR 1 it would be classifiable under tariff item 25221000.
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The bench found that the careful examination of the tariff entries of chapter heading 2522 & 2825, reveals that it is not the case that the goods covered under CTH 2522 and CTH 2825 represent contending classification for applying GIR 3 as made out by Revenue. This is for the reason that quick lime cannot be referred to as containing wholly or partly of goods of CTH 2522 and CTH 2825. There is clear exclusion of calcium oxide and hydroxide of CTH 2825 from the scope of CTH 2522, and only separate chemical elements or separate chemically defined compounds are covered under the scope of CTH 2825.
The facts reveal that the imported goods are quicklime. There is no case of mixture of different material or substance to merit application of GIR 2 or 3. Thus, the Revenue’s argument for Classification of quick lime under heading 2825 as it occurs last among other classification under heading 2522 is not legally sustainable. There is no case for application of Rule 3 of GIR in this case. In view of the above, we are of the view that the imported goods are appropriately classifiable under CTH 25221000.
The bench conclude that the imported goods “Quick Lime” would be properly classifiable under Customs Tariff Item 25221000 and not as others under the Customs Tariff Act Item 28259090.
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