Department Barred from Reopening Settled Classification: CESTAT Upholds Claim for Exemption of Duty on Light Green Float Glass [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Principal Bench at New Delhi, dismissed the Revenue’s appeal and upheld the classification of Light Green Float Glass imported by Asahi India Glass Ltd. under CTI 7005 10 10, entitling it to exemption of duty.

M/s Asahi India Glass Ltd. imported Light Green Float Glass from Indonesia, Japan, and Thailand through 220 Bills of Entry filed between 8 January 2021 and 24 February 2023. The goods were provisionally assessed under Section 18 of the Customs Act, 1962, pending resolution of a classification dispute.

The company declared the goods under CTI 7005 10 10 of the Customs Tariff, non-wired glass having an absorbent, reflecting, or non-reflecting layer, and claimed exemption from basic customs duty under Notification No. 46/2011-Cus. The Department, however, contended that the goods were body-tinted and thus classifiable under CTI 7005 21 10 as glass coloured throughout the mass.

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After examining test reports and prior appellate orders, the Assistant Commissioner finalised the assessments under CTI 7005 10 10, cancelled the provisional bonds and bank guarantees, and extended exemption benefits. The Commissioner (Appeals), Jaipur, upheld this decision, citing consistency with an earlier order dated 20.07.2022 in Asahi’s own case, where identical goods were held classifiable under CTI 7005 10 10.

The Department then filed an appeal before the Tribunal.

The Department contended that similar imports by Asahi India and other importers were consistently classified under CTI 7005 21 10, representing body-tinted glass. It argued that the tin layer detected in the test report was inherent to all float glass due to the manufacturing process and did not constitute an absorbent layer as per Note 2(c) to Chapter 70.

Reliance was placed on CBIC Circular No. 23/2024-Customs dated, which clarified that the presence of a tin layer formed naturally during manufacture did not satisfy the definition of an absorbent layer, thus requiring classification under CTI 7005 29 90 or 7005 21 10.

The respondent argued that the classification issue had been conclusively settled by the Commissioner (Appeals)’s order dated 20.07.2022, which was accepted by the Committee of Commissioners and implemented across ports. The test reports from CSIR-CGCRI, Kolkata confirmed the presence of an absorbent layer (tin) on one side of the glass, satisfying the requirements under Note 2(c).

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It was submitted that the Department could not reopen a settled issue merely because of a subsequent circular, and in any event, the circular could not override judicial precedent. Citing the principle of consistency and settled law, the respondent urged dismissal of the appeal.

The Tribunal noted that the classification dispute had already been examined and decided in Asahi’s favour by the Commissioner (Appeals) in 2022, and that the Department had formally accepted that decision. Hence, the same issue could not be re-agitated.

Relying on the Supreme Court’s ruling in Jayaswals Neco Ltd. v. CCE, Nagpur (2006), the Bench observed that once the Department has accepted an order on identical facts, it is estopped from taking a contrary stand in subsequent proceedings.

The Tribunal further held that the CBIC Circular No. 23/2024 could not override judicial decisions or unsettle a settled position of law. Citing CCE v. Ratan Melting & Wire Industries (2008), Minwool Rock Fibres Ltd. (2012), and Kores (India) Ltd. (1997), it reaffirmed that circulars are not binding on appellate or quasi-judicial authorities when contrary to statutory provisions or precedent.

The Tribunal also observed that the test reports confirmed the presence of a fluorescent tin layer on one side, qualifying as an absorbent layer under Chapter Note 2(c). Therefore, the product fulfilled the criteria for classification under CTI 7005 10 10.

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