KARACHI: M/s Khurram Gulzar & Co has approached Customs Appellate Tribunal for the second time seeking withdrawal of penalties imposed by Customs Adjudication and requesting classification of Titanium dioxide cotiox KA-100 under HS Code 2823.1100.

The Importers prayed to the Tribunal that in case there was any dispute, the matter may be referred to the classification committee of the Customs House.

According to the details of the case, M/s Khurram Gulzar had imported two consignments of Titanium Dioxide Anatase GA-11 from Taiwan and one consignment of Anatase Cotiox KA-100 from South Korea. Importers have been importing Anatase GA-11 for many years and cleared under as Code 28.23. The consignment of KA-100 was imported for the first time. The importers received a Show-Cause Notice containing the allegation that the Titanium Dioxide Anatase GA-11 and Cotiox KA-100 imported was classifiable under HS Code 32.06 as against 28.23 declared.

The Show-Cause Notice made reference to the Test Report and the Literature, which were never provided to the importers. However, the copy of a test report was provided by the representative of the audit organization on the directive of the learned Additional Collector PaCCS.

A scrutiny of the said test report indicated that it pertained to an import by M/s ICI in the year 1998 in respect of a consignment of Titanium Dioxide imported from Saudi Arabia. The said Test Report has no relevance whatsoever to the consignments which are the subject matter of the impugned Show-Cause Notice.  As such a request for the supply of relevant documents still remains unfulfilled.

M/s Khurram Gulzar submitted reply to the show cause notice that the Titanium Oxide imported by them essentially qualified for classification under heading 28.23 and the Customs had all along been clearing this product (KA-100 and GA 11) under the said PCT heading. Moreover, any departure from the past practice would be unjustified and void. However, Customs Adjudication imposed a penalty.

The importers preferred an appeal against the said Order-in-Original before the Collector of Customs Appeals. It was argued in the appeal that the goods in question were essentially classifiable under PCT heading 2823.0010 as was evident from the Test Reports, past practice of the Customs as well as from the Explanatory Notes that the goods in question would fall under heading 28.23 being not surface treated and its crystal lattice being not doped in the antimony; therefore, the benefit of zero rating of Sales Tax and FED was correctly availed by the importers. Collector Appeals passed an Order-in-Appeal rejected the appeal

Importers approached Appellate Tribunal, which remanded the case to the adjudication officer by directing the department to look into the case afresh after taking into account the submissions made by the appellants on the core issue, and for passing an independent and speaking order.

However, the Customs Adjudication passed the same order again without considering the merits of the case and without providing any basis of the allegations leveled in the show cause notice.