Page 161 - ELT_3rd_1st May 2020_Vol 372_Part

2020 ] VAS NOORULLAH & CO. v. COMMISSIONER OF CUSTOMS (AIR), CHENNAI 383

2. The facts of the case are that the appellant exported leather vide
Shipping Bill No. 3921088, dated 22-7-2009 describing it as “Sheep Nubuck
(Snuffed) Finished Leather”. The officers of customs doubted the description of
the goods. However, the export was allowed without waiting for the test report
based on an undertaking given by the exporter. Sample of the export consign-
ment was sent by Customs officers to Central Leather Research Institute (CLRI)
for testing who confirmed that the consignment does not conform to the descrip-
tion. Export of leather is restricted unless it conforms to the Public Notice Nos.
92-97, dated 27-5-1992 issued by DGFT. Accordingly, the original authority vide
his order dated 9-9-2009 held that the goods are liable for confiscation under Sec-
tion 113(i) & (ii) of the Customs Act, 1962 and imposed a redemption fine under
Section 125 of Rs. 10,000/- as the goods have already been exported. He further
imposed a penalty of Rs. 5000/- upon the exporter under Section 114(ii) of the
Customs Act, 1962 and demanded export duty applicable to the goods of Rs.
1,56,457/-. He further ordered that the export to repay drawback, if any, availed
with applicable rate of interest to the department. Aggrieved, the appellant ap-
pealed before the first appellate authority. An interim order dated 19-5-2010 was
passed by the first appellate authority observing as follows :
“On a perusal of the case, it is seen that CLRI has certified that the sample
does not conform to the norms and conditions lay down in the said Public
notice. The lower authority has passed the impugned order on the strength
of the said certificate. But on the other hand, the appellants vehemently ar-
gues that the said entry in the PN does not cover goods made from sheep
leather. The appellants sought to retest of the sample. Accordingly, I direct
the lower authority to send the second sample that is available with the de-
partment to CLRI for retest and submit report before this forum. Thereafter,
the issue will be decided on merits. The impugned order is stayed until
then.”
Accordingly, the department has sent the sample for retesting to check if the
goods matched description. The second test report described the goods as fol-
lows :
“3. With reference to the above, we give below our technical opinion on
the leather sample submitted on 27-7-2009 by you and retested the same as
follows.
“The leather sample which was submitted by you through your Letter No :
S.Misc.50/2009-Exp.Exam, dated 27-7-2009 (declared as Sheep Nubuck
(Snuffed) finished leather) was tested as per the public notice that was in
force that time 3-ETC-PN (1992-97), dated 27-5-1992 and the certificate
issued as not a finished leather under the category of sheep nubuck leather
(as per declaration) due the absence of snuffing to produce velvety nap.
Since there was no nubuck leather listed under the sheep skin leathers, the
leather was assessed as (VI)(1)(L) which is the cow nubuck leather. Irre-
spective of the substrate, the snuffing to produce velvety nap is the critical
norm for deciding if a given leather is nubuck leather or not. No if the ex-
porter feels it is not a nubuck leather but a finished leather under some
other category, kindly arrange to declare the finished leather clearly to ena-
ble us to assess the same and give out certificate”.
Thereafter, the appeal of the appellant was taken up by the first appellate author-
ity and rejected. Hence the present appeal.
EXCISE LAW TIMES  1st May 2020  161