The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), upheld the nil rate of basic customs duty (BCD) on right claim of classifying goods into “Bakery Shortening”.
The appellants had imported goods declared as “Bakery Shortening” under Bill-of-Entry No. 882999 dated 28.09.2005 and Bill-of-Entry No. 951898 dated 25.01.2006 classifying the same under Customs Tariff Heading (CTH) 1517 9010. The appellants had claimed nil rate of Basic Customs Duty (BCD) under Customs Notification No. 26/2000 (List 5) and Countervailing Duty (CVD) under Central Excise Notification No. 4/2005 (Sl. No. 2) or Sl. No. 246 of Central Excise Notification No. 6/2002.
The assessable value of the goods was Rs.6,84,970/- and Rs.60,69,278/- in respect of Bill-of-Entry No. 882999 dated 28.09.2005 and Bill-of-Entry No. 951898 dated 25.01.2006 respectively and the imported goods were cleared under ‘nil’ duty.
The Revenue, entertaining a doubt that the benefit of Notification No. 4/2005 (Sl. No. 2) was applicable only for those goods falling under CTH 1516, Demand Notices were issued to the appellants proposing to demand the differential duty under Section 28(1) of the Customs Act, 1962.
The counsel for the appellants submitted that the goods covered under heading 1508 before amendment and the goods covered under heading 1517 post amendment, are one and the same. The claim of the appellants for the benefit, for the import of “Bakery Shortening” which was classifiable under heading 1517 as per the amended tariff, stood covered under relevant Excise Notification under heading 1508 prior to the amendment of the tariff.
A Two-Member Bench of the Tribunal comprising M Ajith Kumar, Technical Member and P Dinesha, Judicial Member observed that “To put it in simple words, when Sl. No. 246 was inserted, the Central Excise Tariff Heading 150890 was based on 6 digit code, but the corresponding Customs Tariff was based on 8 digit code; Chapter 15 of the Central Excise Tariff contained Headings up to 1508 as against the revised Central Excise Tariff with 8 digit code having Headings up to 1522 00 90. Hence, CTH 150890 at Sl. No. 246 of Notification No. 06/2002 is to be considered in the light of the 6 digit code as per the old tariff heading alone.”
“Having regard to the change in the scenario in the light of the amendment and the change from 6 digit level to 8 digit level, we are of the view that the appellants were entitled to ‘nil’ rate of BCD since its claim was correct in classifying “Bakery Shortening” under heading 1517” the Tribunal concluded.
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