BETTS INDIA LTD. Vs. COMMISSIONER OF CUSTOMS, GOA

JUDGEMENT

(1.) This is an appeal filed by the appellants against the decision of the Commissioner of Customs and Central Excise, Goa, dated 20.2.2001, made in Order -in -Original No. 2/2001 -COMMR whereunder he has classified the imported "PLASTIC LAMINATED FILMS" under heading 3920 of the Customs Tariff Act, 1975 and under heading 3920 of the Central Excise Tariff Act, and confirmed the differential duty amounting to Rs.1,86,73,889/ - payable in respect of the above consignment of PLASTIC LAMINATED FILMS imported and cleared from January 1997 to April 200 vide bills of entry shown in the annexure to show cause notice under Section 28(1) of the Customs Act. By the said order he also confirmed the provisional assessment of bill of entry as finally assessed at tariff item 39.20 under Customs Tariff Act. He also imposed a penalty of Rs.1,86,73,889/ - under Section 114A of the Customs Act.

(2.) The appellant before us is now known as Betts India Ltd., Goa, was previously known as Courtalds Packaging (India) Ltd. The appellants, Belts India Ltd., imported 'PLASTIC LAMINATED FILMS" and described the same as "CORE OF ALUMINIUM FOIL COVERED ON BOTH SIDES WITH PLASTIC FILMS" and sought to classify the same under chapter sub -heading 7607.19 of the Customs Tariff Act read with chapter sub -heading 7607.90 of CETA which incidentally relates to aluminium foil. The case of the department is that in plastic laminated films, the aluminium foils is not department is that in plastic laminated films, the aluminium foil is not backed but covered on both sides/embedded between four layers of plastic films (two on either side) and as such the imported films cannot be classified under chapter heading 76.07; further the structure of the imported film is LLDPE 110 m/PE white 45m/Alu. 30m/PE, 30m/LLDPE 60m, as a result the predominant material in plastic laminated film is LLDPE and PE i.e. plastic material; on the basis of the CBEC Circular No. 7/90 -CX3 dated 23.2.1990 as modified by Circular No. 461/27/99 -CX dated 11.6.1999, the plastic laminated films are classifiable under heading 39.20 of the Customs Tariff Act as plastic sheet foils separated by layer of aluminium foil. A show cause notice dated 30.7.1999 in respect of bills of entry dated 12.2.1999, 13.5.1999, 31.5.1999,8.6.1999 and 30.6.1999 was issued demanding differential duty of Rs.9,53,230/ - due to wrong classification by the assessee under chapter 76.07 instead of 39.20 of the Customs Tariff Act. It came to light thereafter that the assessee was purchasing/procuring from India Aluminium Ltd., Kalwa identical PLASTIC LAMINATED FILM indigenously manufactured, wherein the same was classified under chapter 39.20 of the CETA paying appropriate duty. It is therefore claimed by the department that there has been suppression by the assessee in respect of the same material being procured indigenously which has been classified under chapter 39.20 but declared the classification of the imported plastic laminated films in the various bills of entry for clearance under 7607.19 under the Customs Tariff Act read with heading 7607.90 of the CETA. Therefore a show cause notice dated 1.5.2000 was issued invoking extended period of limitation demanding differential duty which is described in the first paragraph of this order.

(3.) The assessee objected to this by filing reply dated 5.6.2000 claiming inter alia that as far as the indigenously manufactured item is item is concerned, the same was procured by them from Indian Aluminium Ltd., and they claimed the classification of the product under heading 39.20 of the CETA, on the instructions of the department. Therefore the assessee importers cannot be held liable for suppression. As far as the bills of entry are concerned the classification has been claimed correctly as the aluminium has been sandwiched between polyethylene to have the barrier properties and prevention of moisture. This is the thrust of the arguments. It is no doubt true in the reply as well as during he course of the hearing before the adjudicating authorities, several case laws were cited and considered by the adjudicating authority and the adjudicating authority came to the conclusion that there has been a suppression and confirmed the duty demanded as well as imposed penalty. Hence the present appeal.