The Ahmedabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Alloy Steel Forging Rings which require a further operation to be ready to use are classifiable as ‘Other Articles of Iron or Steel’ under the Customs Tariff Act,1975.
Shri Paresh Dave & Shri Paresh Sheth, Advocates appeared for the Appellant and Shri Vinod Lukose, Superintendent appeared for the Respondent.
M/s. Ravi Techno forge Pvt. Ltd. and Shri A Philip Mathew, the appellants challenged the Order-in-Appeal dated 28.03.2018 and 13.05.2021 under which the Commissioner (Appeals) has upheld the Order-In-Original dated 23.11.2016 and 24.03.2020 and the Appeals were rejected.
The appellant had exported Alloy Steel Forging Rings which were classified under CTH 84829900 and claimed the DEPBbefore October 2011. From October 2011 the Appellant started classifying the goods under CTH 73261990 and claimed the drawback which was not accepted by the department.
Goods exported by the Appellant were proposed to be confiscated as per Section 113(ii) of the Customs Act, 1962 and to impose a penalty on the Appellant under Section 114(iii)/114AA of the Customs Act, 1962.
The Adjudicating authority vide OIO dated 23.11.2016 decided the case and re-classified the goods under the proposed classification and held the goods liable for confiscation and imposed redemption fine; ordered recovery of excess drawback. On appeal, the Commissioner (Appeals) who vide impugned order rejected the Appeals of the Appellant and upheld the OIO dated 23.11.2016.
It was evident that goods which are only forged or stamped but not further worked will qualify under Tariff item 7326 and any process carried out beyond the forging would automatically go out CTH 7326.
The appellant contended that as the process carried out by them was annealing, machining and turning processes after the forging of their products and the goods of the appellant would not fall under the broad heading CTH 7326. He further held that on verification of the HSN and its explanatory notes for chapter 8482, it is found that the chapter heading covers all ball, roller or needle roller bearing which consists of Rings, cages, fixing sleeve etc and claimed to be appropriately classifiable under 84829900.
A Coram ofRamesh Nair, member (judicial) and Raju, member (technical)observed that from the Chartered Engineer‟s Certificate dated 18.07.2017 it was certified that the Appellant uses Round Bars/Rods of Alloys Steels as their raw material, and such round bars/ rods are heated at an appropriate temperature in induction bar heater and cut according to the required size. The cut pieces are then subjected to the forging process using a power press machine with 3 different strokes for upsetting, punching and piercing which is known as a rough forged ring.
The Tribunal held that the goods require further operation and such goods when not fit for being ready to use, would appropriately be classifiable under Tariff item 7326 and set aside the impugned order while allowing the appeal.
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