By TIOL News Service

MUMBAI, JUNE 07, 2017: THE issue is regarding classification of imported "copper sulphate technical grade".Appellant classified the same under CTH 28332500.

The appraising officer raised a query as to the classification of the said goods on the ground that it required registration from Central Insecticides Board (CIB) as per Insecticides Act.

The Appellant informed that they are not registered with CIB and they are not required to as the said goods were imported in terms of SION for manufacture of zinc concentrate.

The adjudicating authority changed the classification of the goods from 2833 to 3808 on the ground that the said goods find mention in the Schedule to the Insecticides Act and there being a requirement of an import permit to be procured from Central Insecticides Board, in the absence of which, the goods are liable for confiscation.An option was given to redeem the goods on payment of redemption fine and penalty was imposed.

Before the CESTAT, the appellant submitted that the provisions of Section 38(1)(b) of the Insecticides Act, 1968 specifically exempts registration and requirement of licence for importers who are actual users. Moreover, the goods are for manufacture of zinc concentrate and not for preventing, destroying, repelling or mitigating any insects, rodents, fungi, weeds and other form of plant or animal life not useful to human beings. Also, there is no violation of Foreign Trade Policy.

The AR did not have much to add except reiterating the findings of the lower authority.

The CESTAT observed –

+ The mere assertion of the adjudicating authority that the goods are liable for classification under CTH 3808 is of no consequence as no reasoning have been given.

+ It can be seen from Section 38 (of the Insecticides Act, 1968) that exemption is granted from application of Insecticides Act for the sub-clauses mentioned therein. It can be noticed that sub-clause (1)(b) specifically talks about if the substance, even if it is mentioned in the Schedule to the Insecticides Act, is intended for any other purposes other than preventing, destroying, repelling or mitigating any insects, rodents, fungi, weeds and other form of plant or animal life not useful to human beings, the provisions are not attracted.

+ The adjudicating authority has held that copper sulphate technical grade is used by the appellant for manufacturing of zinc concentrate. In our considered view, the exemption under Section 38(1)(b) of the Insecticides Act will directly apply in the case in hand.

Holding that the impugned order is unsustainable, the same was set aside and the appeal was allowed with consequential relief.

(See 2017-TIOL-1901-CESTAT-MUM)