Classification of imported goods must adhere to prior adjudications unless conclusively challenged; extended limitations for duty recovery require substantial justification.

COMMON ORDER

Background The petitioner is engaged in the business of manufacturing of processed laminated and tempered glass, inter alia, for automotive purposes. The petitioner also imports glass, including light green tinted float glass, for its business operations, and such imports have been made by the petitioner since 2011. While importing light green tinted float glass, the petitioner classified and cleared the same under Customs Tariff Heading (CTH) 70051010. An audit consultative letter dated 01.05.2022 was issued to the petitioner seeking to classify goods imported under 35 bills of entry detailed in the enclosed worksheet under CTH 70052110 instead of CTH 70051010 and calling for payment of Rs.1,14,03,577/-. Such communication was responded to by the petitioner on 11.05.2022 by asserting that the goods are non-wired and have an absorbent layer of tin on one side, which is fluorescent under UV illumination, and also have a microscopically thin non-reflecting layer of zinc sulphate coating on the surface of the glass. Test reports were annexed in support of the assertions. Consequently, it was stated that the classification in CTH 70051010 was in order. A subsequent detailed letter dated 06.03.2023 was also issued by the petitioner.

2. According to the petitioner, on the erroneous basis that the petitioner had not responded to the audit consultative letter, the first respondent issued a show cause notice dated 07.08.2023, whereby the extended period of limitation was invoked, and the petitioner was called upon to show cause as to why the light green tinted float glass imported under the bills of entry detailed in Annexure-I thereto (the Relevant Goods) should not be classified under CTH 70052110. The amount payable by the petitioner towards short-levy was computed at Rs.11,78,27,642 in this show cause notice. The present writ petitions were filed upon receipt of the aforesaid show cause notice. In W.P.No.28456 of 2023, the petitioner seeks to quash the show cause notice. In W.P.No.28462 of 2023, the petitioner seeks a direction to permit clearance of light green tinted float glass under CTH 70051010 in view of earlier decisions of various authorities of the Customs Department classifying the goods under CTH 70051010. In W.P.No.28465 of 2023, the petitioner seeks a declaration that the classification adopted by the petitioner is correct and proper.

Counsel and their contentions

3. Oral arguments on behalf of the petitioner were advanced by Mr.Vijay Nayaran, learned senior counsel, assisted by Mr.Karthik Sundaram, learned counsel. Oral arguments on behalf of the respondents were advanced by Mr.Rajendran Raghavan, learned senior standing counsel.

4. Learned senior counsel referred to the impugned show cause notice and pointed out that float glass falls within CTH 7005 and that the Relevant Goods fall within the six digit entry 700510 of the CTH set out in paragraph 7 of such show cause notice, which relates to non-wired glass, having an absorbent, reflecting or non-reflecting layer. At the eight digit level, he submitted that it falls within 70051010, which relates to tinted glass having the characteristics described in CTH 700510. Without considering the petitioner's reply to the audit consultative letter, he contended that the first respondent has called upon the petitioner to show cause as to why the Relevant Goods should not be classified under CTH 700521 (at the six digit level), which pertains to float glass coloured throughout the mass (body tinted), opacified, flashed or merely surface ground. He also pointed out that the respondents seek to re-classify the Relevant Goods in CTH 70052110, at the eight digit level, which relates to tinted float glass having the other characteristics specified in 700521. By further referring to paragraph 17 of the show cause notice, learned senior counsel submitted that reference is made therein to a recent test report and the results thereof (Ref. No.GC/TCC/TR- 3448/22-23 dated 11.04.20