Test reports of samples from specific consignments cannot be retrospectively and mechanically applied to past imports for differential duty demands, and classification disputes involving an honest declaration of fact based on tariff interpretation do not constitute wilful misstatement or suppression to warrant the extended limitation period.

The present appeal has been filed against the Order-in-Original No. KOL/CUS/COMMISSIONER/PORT/GR.1/57/2025 dated 13.11.2025 (as corrected by Corrigendum dated 26.12.2025) passed by the Ld. Principal Commissioner of Customs (Port), Custom House, 15/1, Strand Road, Kolkata – 700 001, West Bengal.

M/s. M. P. Mica Enterprises Pvt Ltd, Jharkhand (hereinafter referred to as the “Appellant”) have imported goods and filed Bills of Entry declaring the goods as “Crude Mica Rifted into Sheets” and claimed classification of the same under the Tariff Item 25251090 during self-assessment. The said goods have been described as “Crude Mica Rifted into Sheets” in all import documents, invoices, packing lists, etc. The description declared in the Bills of Entry exactly matched the overseas supplier’s documents.

Based on intelligence developed by SIIB (Port), that the goods imported by the Appellant were actually 'PROCESSED MICA SHEETS OF REGULAR SHAPES & SIZES AND PLAIN EDGE," which fall under Tariff item 68149090 of the First Schedule to the Customs Tariff Act, 1975 , the officers alleged that the Appellant had mis-classified the goods with a view to pay less Customs Duty. Basic Customs Duty (BCD) is 5% for goods under Tariff Item 25251090 but 10% for CTH 68149090, and Integrated Goods and Services Tax [IGST] is 5% for Tariff Item 25251090 versus 18% for CTH 68149090. Accordingly, samples were drawn from two consignments and sent to CRCL, Kolkata.

The CRCL reports stated that the samples “appear to be processed mica”. Based on the said reports, the Customs proposed reclassification of the goods pertaining to 2 live Bills of Entry and 72 past Bills of Entry (out of which 2 Bills of Entry had been provisionally assessed), by invoking extended period of limitation under Section 28(4).

A Show Cause Notice was issued demanding differential duty. After due process of adjudication, the impugned order has been passed confirming the demand of differential Customs duty of Rs.26,57,292/- for the two live and two provisionally assessed Bills of Entry and differential Customs duty of Rs. 4,89,96,957/- for the 70 past Bill of Entry under Section 28(4) of the Customs Act, 1962, along with confiscation under Section 111(m), redemption fine under Section 125 and penalties under Sections 112 (a), 114A and 114AA of the Customs Act, 1962.

Aggrieved by the confirmation of the demands of Customs duty along with interest, confiscation of the goods and imposition of Redemption fines and imposition of penalty, the Appellant has filed this appeal.

The Ld. Counsel appearing on behalf of the Appellant submits that Customs Tariff Heading 2525 specifically covers “Crude Mica and Mica Rifted into Sheets”. It is submitted that the description used by them in the Bills of Entry corresponds word-for-word with the tariff heading; that HSN Explanatory Notes recognize substantial processing within Heading 2525; the CTH 2525 covers processed Mica also; the heading excludes only products obtained by:

• cutting-out,

• die-stamping,

• agglomeration,

• reconstitution.

It is pointed out by the appellant that the Chapter Heading 6814 applies only where mica is further worked beyond rifting and trimming; the HSN notes to Heading 68.14 state that it covers: “Natural mica, further worked than merely rifted and trimmed (e.g., cut to shape).” Thus, it is their case that the Department had to establish that the goods were:

• die-punched;

• cut to specific shape;

• agglomerated;

• reconstituted; or

• specially worked.

However, the Appellant argues that no such evidence has been brought on record by the Revenue and thus, the goods in question cannot be classified under the CTH 6814.

The Ld. Counsel for the Appellant submits that they use the imported goods as raw material for further punching, die-cutting and fabrication as per customer specifications; therefore, at the time of import the goods were not products “cut to shape” or intended for specific end-use.

It is further submitted by the