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Dated: 12.02.2025

CESTAT Delhi allows classification of Light Green Float Glass with duty exemption

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, upheld the classification of Light Green Float Glass imported by M/s Asahi India Glass Ltd. under CTI 7005 10 10, making it eligible for duty exemption. The tribunal dismissed the Customs Department’s appeal, ruling that CBIC circulars cannot override settled legal precedents.

Key Highlights of the Proceedings:

1. Case Background:

• The dispute concerned the classification of Light Green Float Glass imported by M/s Asahi India Glass Ltd.
• The Commissioner of Customs (Preventive), Jaipur appealed against the Commissioner (Appeals), Jaipur’s order, which had upheld the classification under CTI 7005 10 10, granting customs duty exemption.
• The Customs Department argued that the goods should be classified under CTI 7005 21 10, making them subject to duty.

2. Main Legal Issue:

• Whether Light Green Float Glass with a tin layer on one side qualifies as non-wired glass with an absorbent layer (CTI 7005 10 10) or as body-tinted glass (CTI 7005 21 10).
• This classification determined eligibility for exemption under Notification No. 46/2011-CUS dated 01.06.2011.

3. Arguments by the Customs Department:

• The tin layer does not constitute an “absorbent layer” under Chapter Note 2(c) of the Customs Tariff Act, 1975.
• The CBIC Circular (14.11.2024) clarified that clear float glass with only a tin layer should be classified under CTI 7005 29 90, not CTI 7005 10 10.
• Earlier imports of similar goods were classified differently, leading to inconsistency.

4. Arguments by Asahi India Glass Ltd.:

• The Commissioner (Appeals) had previously ruled (20.07.2022) in their favor, and that decision was accepted by the department, setting a precedent.
• Test reports from CSIR Kolkata confirmed the presence of an absorbent tin layer, justifying classification under CTI 7005 10 10.
• Supreme Court rulings establish that in case of ambiguity in classification, the interpretation favoring the assessee should be adopted.

5. CESTAT’s Findings:

• The tribunal rejected reliance on the CBIC Circular, ruling that circulars cannot override settled legal positions.
• The presence of an absorbent tin layer met the criteria for CTI 7005 10 10, making the goods eligible for duty exemption.
• The Customs Department had earlier accepted this classification, and it cannot now take a contradictory stance.
• Past legal precedents and test reports supported Asahi India Glass’s classification claim.

6. Final Decision:

• The Customs Department’s appeal was dismissed.
• The tribunal upheld the classification under CTI 7005 10 10, confirming duty exemption for Asahi India Glass Ltd.
• The ruling reinforced that circulars cannot override judicial decisions, and tax classification disputes should favor the assessee in case of ambiguity.

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Source: CESTAT Delhi

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