Ortho Clinical Diagnostics India Pvt Ltd Vs Commissioner of Customs (Import) (CESTAT Mumbai)
Summary: CESTAT Mumbai considered an appeal by M/s Ortho Clinical Diagnostics India Pvt Ltd against Order-in-Original No. CC-VA/12/2020-2021 ADJ (I) ACC dated 2 July 2020 passed by the Commissioner of Customs-III (Import), ACC, Mumbai. The dispute concerned the rate of integrated tax applicable to imported diagnostic kits, diagnostic reagents, controls, calibrators and other consumable reagents.
The differential duty of ₹4,47,00,863 arose from denial of the appellant’s claimed IGST rates of 5% and 12%. The consequential proceedings also involved confiscation under Section 111 of the Customs Act, 1962 and penalty under Section 112. The goods included ELISA diagnostic kits, CLIA diagnostic kits, diagnostic reagents on backing, controls and calibrators and other consumable reagents. Their classification under tariff item 3822 0019 of the First Schedule to the Customs Tariff Act, 1975 for assessment of basic customs duty had not been controverted in the show cause notice. Nevertheless, the adjudicating authority held that the goods should appropriately have been classified under tariff item 3822 0090 and consequently applied the residuary entry carrying an 18% IGST rate.
The appellant contended that Notification No. 01/2017-Integrated Tax (Rate) dated 28 June 2017 prescribed IGST rates by reference to tariff items, sub-headings, headings or chapters of the Customs Tariff Act, 1975 and that the relevant interpretative rules and notes were applicable. The appellant submitted that ELISA and CLIA diagnostic kits were specifically covered by the relevant List 1 entry corresponding to Serial No. 180 of Schedule I and attracted 5% IGST. For the other goods, reliance was placed upon the description of “all diagnostic kits and reagents” under Serial No. 80 of Schedule II, attracting 12% IGST. The appellant also relied upon the Harmonised System of Nomenclature Explanatory Notes and other authorities.
