CESTAT Upholds Duty Demand on Amprolium HCL, Rules it is a Pure Chemical

CESTAT Upholds Duty Demand on Amprolium HCL, Rules it is a Pure Chemical

Introduction

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that Amprolium HCL is a pure chemical classifiable under Chapter 29 of the Customs Tariff and not under animal feed premixes. The Tribunal upheld the duty demand raised by the Department.

Factual Background

The appellant, Vital Therapeutics Pvt. Ltd., imported several consignments of feed additives and chemicals, including Amprolium HCL. The Department alleged misclassification, claiming the product was declared as animal feed premixes to claim exemption from duty, whereas in reality it was a pure chemical falling under Chapter 29 of the Tariff.

Procedural History

The adjudicating authority accepted the Department’s view, confirmed the duty demand on Amprolium HCL, and imposed penalties. The Commissioner (Appeals) upheld this decision. The appellant then approached the CESTAT.

Contentions of the Parties

• Appellant’s Contention: The appellant argued that Amprolium HCL was used in the animal feed industry and should qualify as an animal feed premix, thereby eligible for exemption under the relevant notification. They also contended that it was not marketed as a standalone chemical but as an input for feed formulations.
• Revenue’s Contention: The Revenue maintained that Amprolium HCL was imported in its pure form, not as a mixture or formulation, and hence was appropriately classifiable under Chapter 29. Test results and import documents, they argued, clearly established this fact.

Issues

1. Whether Amprolium HCL is classifiable under Chapter 29 as a pure chemical or under animal feed premixes.

2. Whether the duty demand on Amprolium HCL was sustainable.

Tribunal’s Reasoning

The Bench comprising Ajayan T.V. (Judicial Member) and Vasa Seshagiri Rao (Technical Member) observed that Amprolium HCL was imported in its pure form without any evidence of being part of a premix.

The Tribunal clarified that classification must be determined on the nature of goods at the time of importation, not on their end-use. Since Amprolium HCL was a pure chemical, it could not be classified as an animal feed premix for the purpose of exemption.

Outcome

• The Tribunal upheld the duty demand on Amprolium HCL.
• The appellant, however, received partial relief on other products.

Significance

This ruling underscores the principle that classification depends on the inherent nature of the goods at the time of import, not their eventual use. It also serves as a caution for importers to ensure accurate classification to avoid duty disputes.