By TIOL News Service

MUMBAI, APR 22, 2015: WHILE allowing the appeal filed against the order dated 01/04/2008 of Commissioner of Customs (Import), Nhava Sheva, the CESTAT had vide its order dated 21.01.2011 held thus -

Customs - Anti Dumping Duty - Steel Wheels falling under CTH No.87087000 of the Customs Tariff Act, 1975 when imported into India from China attracts Anti Dumping Duty - The Appellant imported Steel Wheels of size 7.5 x 20" by classifying it under CTH No. 87169010 by declaring the description of goods as "Trailor Parts - Steel Wheels Size 7.5 x 20" - Though the Adjudicating Authority observed that the imported goods are principally used as the wheels for buses and trucks and the same can also be used as wheel for Trailers, no evidence is available either in the show cause notice or in the Order-In-Original to that effect - No change in description of imported goods prior to or after imposition of anti dumping duty - The Steel Wheels and parts of Trailers clearly falls under CTH No.87.08 in terms of the HSN Explanatory Notes - There is no evidence on record for classifying the imported goods under CTH No.87.08 - Since anti-dumping duty is a levy, it is the responsibility of the Revenue to substantiate that the goods under importation attracts the levy - Appeal allowed: CESTAT (Para 6).

We reported this order as - 2011-TIOL-1737-CESTAT-MUM.

Thankfully, pursuant to the order of the Tribunal, the JNCH Customs released the Bank Guarantee executed by the appellant for imports made during the period September 2008 to October 2011. The appellants were allowed to clear the goods under sub-heading 8716.90 without payment of anti-dumping duty. Even Calcutta port allowed clearance of the same goods without levy of Anti-dumping duty. In fact, the aforesaid order of CESTAT was accepted by the department.

But things changed when Notification 124/2007-Cus as amended by notification 16/2012-Cus-(ADD) dated 20.03.2012 lost its steam and another notification No.3/2013-Cus (ADD) dt. 26.03.2013 came on to the scene for imposition of anti-dumping duty on Flat Base Steel Wheels falling under Heading 87.08.

The Customs authorities again raised the same dispute and directed the importer to execute a Bank Guarantee to the extent of 20% of anti-dumping duty on the goods imported. The appellant represented through letters dt. 9.5.2013, 15.5.2013, 31.8.2013, 25.9.2013, 3.10.2013, 8.10.2013 to Customs at JNCH that anti-dumping duty is not payable in view of CESTAT Order dt. 20.10.2011, but to no avail.

Therefore, the appellant has filed a Miscellaneous application before the CESTAT praying that the Customs at Nhava Sheva be directed to implement the order and also be directed to allow clearance of the consignments without insisting on execution of Bank guarantee and bond.

When the case came up for hearing, the appellant pleaded that as the goods imported now are identical to the goods covered by CESTAT Order dt. 20.10.2011, and which order has been accepted by the department, there is no ground for taking Bank Guarantee.

The AR for the Revenue was asked by the Bench to seek a report from Commissioner of Customs, JNCH as to why the CESTAT order is not being implemented. On the next date of hearing, the AR submitted a letter from the office of Commissioner of Customs admitting that the CESTAT Order dt. 20.10.2011 was accepted by the Department.

It also stated -

"However in 2013, on re-examination of the issue, it was noted that the Hon'ble CESTAT while allowing the aforesaid appeal had noted that - ‘Both in the show-cause notice as also in the order-in-original, the adjudicating authority has observed that the goods under importation was principally used as the wheels for buses and trucks and it could also be used as wheel for trailers. However, the basis for such observations nor any evidence relating thereto have been adduced either in the notice or in the order. In other words, it is only a mere observation without any supporting evidence.' However, during the enquiries with a leading manufacturer of buses and trucks, it has been ascertained that steel wheel of rim size 7.5 X20" are ‘interchangeable between trucks and trailers'. It has also been confirmed that they import such steel wheel rims from China on payment of ADD.

In view of the above and since there was a chance of misuse of Hon'ble CESTAT order by other importers of Steel Wheel of rim size 7.5 X 20" by declaring them as parts of trailers, it was decided to assess such consignments provisionally till a clarification is received from CBEC."

The Bench after considering the submissions observed -

++ CESTAT Order dt. 20.10.2011 has been accepted by the Customs department. Raising factual issues now belatedly after more than two years only reflects the confusion prevailing in the department.

++ There is no dispute that the goods being imported now are identical to the goods covered by the CESTAT Order.

++ The action of Customs to seek Bank Guarantee for clearances now when the matter was settled in 2011 is unwarranted and amounts to harassment. The action is also contrary to the policy and spirit of the National Litigation Policy which aims at reducing litigation.

++ The letter of Commissioner states that the matter has been referred to the CBEC. This is not an acceptable reason for not implementing the order of the CESTAT.

The CESTAT, therefore, directed the Commissioner of Customs, JNCH to immediately implement the CESTAT Order, allow clearance of the consignments without insisting on a Bank Guarantee and report compliance within two weeks.

(See 2015-TIOL-721-CESTAT-MUM)