CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL NEW DELHI PRINCIPAL BENCH – COURT NO. – IV Customs Appeal No. 51283 of 2023 [Arising out of Order-in-Original No. 11/2022-23/Simmi Jain/Principal Commissioner dated 16.09.2022 passed by the Principal Commissioner of Customs (Air Cargo Complex Import), New Delhi]

M/s. Mishra Dhatu Nigam Limited …Appellant Sector 30A, Plot No. 8 & 13, Phase II, IMT Rohtak, Haryana - 124001 VERSUS Principal Commissioner of Customs, Air Cargo Complex (Import), New Delhi …Respondent New Customs House, Near IGI Airport, New Delhi - 110037 APPEARANCE:

Shri Mayank Srivastava, Advocate and Shri Sudhir V.S. and Shri Asish Chaudhary, Chartered Accountant for the Appellant Shri Rakesh Kumar, Authorized Representative for the Respondent CORAM:

HON’BLE DR. RACHNA GUPTA, MEMBER (JUDICIAL)

HON’BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)

DATE OF HEARING: 23.09.2025 DATE OF DECISION: 16.01.2026 FINAL ORDER NO. 50142/2026 DR. RACHNA GUPTA Present appeal has been filed to assail Order-in-Original No.

11/2022-23 dated 16.09.2022. The facts which culminated into the said order are as follows:

1.1 M/s. Mishra Dhatu Nigam Limited, the appellant herein filed 16 Bills of Entry on three different dates i.e. 12.11.2020, 13.11.2020 and 04.12.2020 for clearance of imported goods declared as "Polyethylene Fiber Product Name HB26 A" by classifying those under CTH 39201099 which covers 'other plates, sheets, film, foil and strip, of plastics, non-cellular and not reinforced, laminated, supported or similarly combined with other materials. The Basic Customs Duty (BCD) was paid at the rate of 10%, Social Welfare Surcharge (SWS) on BCD at the rate of 10% and IGST was paid at the rate of 18%. On perusal of the import invoices issued by the supplier M/s. DSM Protective Materials BV, Netherlands uploaded on e-sanchit in respect of all the said Bills of Entry, it was found that the product name mentioned therein is 'HB26 A' and the commodity code is mentioned as 540730 which covers woven fabrics of synthetic filament yarn. The effective rate of BCD on the goods classifiable under sub-heading 540730 is 20%, SWS on BCD is payable at the rate of 10%. With these observations, the department at the stage of post clearance audit of the Bills of Entry filed by the appellant, alleged that the appellant has short paid the duty on the imported goods while wrongly classifying the imported goods. Accordingly, vide Demand Cum Show Cause Notice No. 66/2021-22 dated 24.08.2021, it was proposed that the imported goods may be classified under CTH 540730 instead of declared CTH 39201099 having the assessable value of Rs.10,42,68,575/-. In view of the mis-declaration the goods were proposed to be confiscated. Differential amount of duty of Rs. 1,14,69,543/- on the goods imported vide all 16 Bills of Entry was proposed to be recovered from the appellant. Penalty is also proposed to be imposed upon the appellant under Section 112 (a) (ii) and Section 117 of the Customs Act, 1962. The said proposal has been confirmed vide the aforementioned impugned order. Being aggrieved, the appellant is before this Tribunal.

2. We have heard Shri Mayank Srivastava, learned Advocate along with Shri Sudhir V.S. and Shri Asish Chaudhary, learned Chartered Accountants for the appellant and Shri Rakesh Kumar, learned Authorized Representative for the department.

3. Learned counsel for the appellant has submitted that the imported product is in the form of sheet which is neither woven nor is a fabric but purely a plastic sheet. Learned counsel has impressed upon the certificate issued by Northern India Textile Research Association certifying that HB-26 is a plastic fabric. The input used to manufacture the product is polyethylene fiber and the imported sheet (HB26A) is the raw material for hard pressed ballistic protective applications and is sold only for downstream industrial processing. Learned counsel has impressed upon that the imported product is neither a fabric nor fiber nor y