By TIOL News Service

AHMEDABAD, JUNE 23, 2014 : THIS is a Revenue appeal.

The respondent filed a bill of entry seeking classification of the imported Palm Kernal Acid Oil under CTH 38231900.

Samples were drawn and sent to Chemical Examinerand based on the reports received a SCN was issued for classifying the imported goods under CTH 15132910 and this was upheld by the Assistant Commissioner.

The lower appellate authority decided the classification of the imported goods under CTH 38231900 and allowed the appeal of the respondent.

As this order was not honoured, the respondent approached the Gujarat High Court and the High Court disposed of the petition by ordering the release of the goods subject to certain conditions but without expressing any opinion on the merits of the classification and suggested to the Department to request the Tribunal to give an early hearing in the matter of the appeal filed by them.

Theapplication seeking early hearing of the appeal filed by the Revenue was allowed by the Tribunal.

The respondent submitted that there is no argument advocated by the Revenue that imported goods need classification under CTH 1515 and Commissioner (Appeals) had only the option of deciding the classification of imported goods either under CTH 1513 or CTH 38231900, as per the show cause notice issued. Further, Revenue has not taken any ground in the appeal as to why classification decided by Commissioner (Appeals) under CTH 38231900 is not correct.

Inasmuch as it is the submission of the respondent that at this stage Revenue cannot go beyond the scope of SCN and contend that CTH 1515 is the correct classification of the imported goods.

The Bench observed –

“6. Heard both sides and perused the case records. The issue involved in the present appeal filed by the Revenue is whether classification of the imported goods Palm Kernal Acid Oil can now be made under CTH 1515 when the original contest was for classification of the imported goods under either CTH 38231900 or CTH 15132910 before the Adjudicating authority and the first appellate authority. The dispute taken before the first appellate authority by the importer (present respondent) was decided under CTH 38231900 after getting further testing of the sample of imported goods. Even after receipt of the subsequent test report, as per the directions of first appellate authority it was not agitated by the Revenue that classification of the imported goods could be other than CTH 38231900 or CTH 15132910. When an issue is not the subject matter of the show cause notice first issued and was not agitated before the lower authorities, it has to be held that Revenue has no justification in agitating an issue before this Bench which was not agitated before the lower authorities. Accordingly, the lower authorities cannot be directed to go beyond the scope of the show cause notice.”

Holding that there is no merit in the appeal filed by the Revenue, the same was rejected.

(See 2014-TIOL-1093-CESTAT-AHM)