In re Evans Consoles Corporation (CAAR Delhi)
Product under consideration is described as ‘Evans Consoles’ in the product literature, which is equipped with switches, electric motors and other electronic equipment, meant for performing specialized functions. These Consoles will be designed according the requirements of the customers in India as per the contracts, will be manufactured and assembled prior to shipment, but will be presented in disassembled form for assessment before the Customs. Therefore, I find that the disassembled Consoles, even after factoring in the absence of computer monitor with touch screen capabilities, which will be sourced from domestic suppliers to meet local electrical requirement, would have acquired the essential character of the complete article, viz. electrical console. Accordingly, I follow the settled principle of law and rule 2(a) of the General Rules of Interpretation of the Tariff Schedule to hold that the said disassembled Consoles would merit classification under the same heading as would a complete electrical console. Thereafter, I note that the applicant has submitted that consoles are classifiable under heading 8537 and I find that the description of the goods covered under the said heading in the First Schedule to the Indian Customs Tariff Act, 1975, include inter Min, console, equipped with two or more apparatus of heading 8535 or 8536 for electrical control or distribution of electricity. Further, I rely on Explanatory Notes Heading 8537 of HSN, which has also he relied upon by the concerned Commissioner of customs, NS-V, JNCH to conclude dud the consoles of the kind under discussion merit classification under heading 8537 of the First Schedule to the Indian Customs Tariff Act, 1975.
FULL TEXT OF ORDER OF CUSTOMS AUTHORITY OF ADVANCE RULING, DELHI
M/s Evans Consoles Corporation, 1616-27 Avenue N.E. Calgary, Alberta T2E 8W4, Canada, a company having IEC No. NIL, PAN NIL, (M/s Evans in shod), represented by Mr. S. Muragappan, Advocate. having (ace at No. I, 4th Floor, Cccbros Centre, Old No.45, New No.39, Red Cross Road, Egmore. Chennai — 600 008, has filed an application dated 03.03.2019 seeking advance ruling under section 28-11 of the Customs Act, 1962 before the Authority for Advance Rulings, New Delhi (AAR, in short). The initial application received in the Secretariat of AAR, New Delhi on 11.03.2019 was found to contain certain deficiencies. The O/o AAR vide letter 08.04.2019 requested Mr. S. Murugappan to remove the deficiencies mentioned therein. Thereafter, Mr. Murugappan vide letter dated 17.08.2019 submitted additional documents, etc. to rectify the deficiencies, which was received in the 0/o AAR on 22.03.2019.
2. The said application was being processed in terms of section 284 ibid by the O/o AAR. Thereafter, consequent to the amendments to Chapter V-B of the Customs Act, 1962 and appointment of Customs Authority for Advance Rulings (CAAR, in short) at New Delhi and Mumbai with effect from 04.01.2021, the said application filed by an applicant with address outside the territory of India was transferred to CAAR, New Delhi in terms of section 28-F (3) ibid; and regulation 31 read with regulation 6 (2) of CAAR Regulations, 2021.
3. On perusal thereof, and in view of the time limit of three months for pronouncing its advance rulings from the date of receipt of this application prescribed under section 28-1 (6) ibid, it was held that the aforesaid legacy application received in the o/o AAR, New Delhi on 11.03.2019 had become time barred for this Authority.
4. However, on constructive interpretation of the powers vested with this Authority, vide letter dated 16.07.2021, the applicant and the authorized representative were advised to intimate whether they continued to be interested in obtaining ruling of this Authority, and if so either resubmit their application in the Form CAAR-I appended to CAAR Regulations, 2021, or simply affirm that the declarations made in the earlier application remain valid and unchanged, at the earliest to this Authority. It was also informed that the date of receipt of such resubmitted application or affirmation, as the case may be, shall be taken as the date of receipt of their application under regulation 8(4); and no separate payment of the prescribed fee under regulation 6 (6) of CAAR Regulations, 2021 is required to be made.
5. The authorized representative on behalf of the applicant vide letter dated 21.07.2021 affirmed that the declarations made by them in their earlier application stand valid and unchanged. and informed that they arc interested in obtaining ruling by this Authority.
6. it was noted that the comments of Principal Commissioner of Customs, Nhava Sheva (General) had not been received in response to the request made vide letter dated 26.08.2020. Therefore. this office vide letter dated 09.08.2021 sent a reminder for the same. In this regard, comments from the concerned Commissioner of Customs, Nhava Sheva —V [instead of Principal Commissioner of Customs, Nhavn Shelia (General) ns mentioned in the application) vide letter dated 02/03.12.2021 were received in this office and the same were shared with the applicant.
7. The applicant in his initial application dated 08.03.2019 has submitted the following regarding the product under question:
A. Features & Functionality:
Control room consoles arc consoles incorporating equipment and apparatus for the control and distribution of electricity and for monitoring the affected processes and activities. These are usually produced in Canada. These Consoles are made to order based on the requirements and specifications of the customer. Wiring, power sockets, circuit protection devices, etc. are installed in each console. For shipping purposes, the consoles are in knocked down condition. Final assembly will take place where they are being installed.
Complete consoles require computer monitors with touch screen capabilities. In order to meet local electrical requirements, these are sourced from a supplier near the installation point. In some cases, the customer will instead sources and supply its own computer monitors for installation into the consoles. These are installed in control rooms for various industrial and governmental application. Examples of where the Consoles are used include, inter-alia; Road Traffic Control, Utilities (e.g. electricity and water), Industrial Process Control, Air Traffic Control, Call Centers and Security.
B. Suggested classification of components:
The applicant has mentioned that internal components of the Consoles are classifiable under different sub – headings of heading 85.36 when presented separately:
(i) Auto transfer switch: This is a power distribution unit and auto transfer switch. It is designed to automatically switch to an uninterruptible power supply in the event the main power is insufficient. It keeps the power at a constant level. This is a function of connection and protecting electrical circuits by maintain a constant power output. Suggested classification is sub-heading 8536.50.
(ii) Power sockets and universal Serial Bus (“USII”) sockets. These devices provide a power plug in for video monitors and a means to make data connections and electrical connections.
Suggested classification is sub-heading 8536.69.
(iii) The Console’s work surfaces are made to he mechanically raised and lowered. This allows the operator to sit or stand while operation it.
8. The applicant is of the view that the product can be appropriately be classified under heading 8537 of the First Schedule to the Indian Customs Tariff Act, 1975. The heading reads as follows:
