Commissioner of Customs (Port) Vs Aahana Commerce Private Limited (CESTAT Kolkata)
Conclusion: Motor controllers should indeed be classified under CTH 8503 0090 as parts of electric motors instead of under CTH 8708 9900 as AO had failed to provide sufficient evidence to substantiate the claim that the declared import values were inaccurate.
Held: Assessee-company imported Motor Controller and different types of Electric Tricycle Spare Parts. All the bills of entries were filed; AO reassessed the importation by enhancing the CIF value and rejected the declared value of the impugned goods and also changed the classification of the item imported viz. ‘Motor Controller’ from CTH 8503 0090 to CTH 8708 9900. Assessee, to avoid delay and demurrage charges, cleared the goods on payment of the enhanced customs duty, under protest, and requested the lower authority to issue the order(s) of assessment under Section 17(5) of the Customs Act, 1962. Accordingly, AO passed orders under Section 17(5) of the Customs Act, 1962. Being aggrieved from the said assessment done by AO, assessee-company filed appeals before CIT (Appeals). CIT (Appeals), after examining the issue, vide the impugned orders, set aside the orders of assessment; the value declared by assessee was accepted and the goods in question had been classified as ‘Motor Controller’ under CTH 8503 0090. On appeal by Revenue. It was held that motor controllers were primarily used to control motor functions, such as starting, stopping, and regulating speed. Given their integral role in the functioning of electric motors, the tribunal ruled that the controllers were correctly classified under CTH 8503 0090, aligning with the previous decision by the Commissioner (Appeals). Furthermore, the tribunal dismissed the customs department’s arguments, noting that AO had failed to provide sufficient evidence to substantiate the claim that the declared import values were inaccurate. In their decision, the tribunal referenced a previous ruling in the case of the same assessee from August 2024, where the same classification issue was raised. The earlier judgment had concluded that motor controllers should indeed be classified under CTH 8503 0090 as parts of electric motors. In result, following this precedent, CESTAT dismissed the appeal filed by the customs authority and upheld the order of the Commissioner (Appeals).
