‘Cold Heading Quality Steel Wire’ Is Finished Wire, Not Rod: CESTAT Quashes ₹115 Crore Customs Duty Demand [Read Order]

In a recent ruling, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, has set aside a ₹115.38 crore customs duty demand against Taeyang Metals India Pvt. Ltd., holding that its imported Cold Heading Quality Alloy Steel Wire in Coils (SCM435 grade) was correctly classified as “wire” and not “wire rods.”

The dispute arose after the Principal Commissioner of Customs (Preventive), Chennai, reclassified the imports under Tariff Heading  wire rods instead of wire, denied the 5 % concessional duty under Notification , and imposedpenalties under Sections 112(a) and 114AA of the Customs Act, 1962.

Appearing for the appellant, Advocate E. Ramesh argued that the product had already undergone cold‑drawing and spheroidized annealing, making it a finished wire suitable for fastener manufacturing. He pointed to BIS certification and supplier catalogues from Hyundai Special Steel confirming the goods as “Cold Heading Quality Wire.”

On the other hand he department, represented by Anoop Singh, contended that the material was merely hot‑rolled wire rods, relying on JIS G4053 specifications and an IIT Madras opinion describing only minimal diameter reduction.

After examining the rival submissions, the bench comprising   P. Dinesha (Judicial Member) and Vasa Seshagiri Rao  (Technical Member) held that the decisive factor was the manufacturing process, not the extent of diameter change. The tribunal noted that the goods had undergone pickling, coating, annealing, and cold drawing, aligning with the definition of “wire” under Chapter 72 of the Customs Tariff.

The bench further clarified that the mention of SCM435 in the mill certificate merely indicated the steel grade, not the product form, and that SAIP (Spheroidized Annealing in Process) was a post‑drawing heat treatment, not evidence of unfinished wire rods.

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