In re Apple India Private Limited (CAAR Mumbai)
Customs Authority for Advance Rulings (CAAR), Mumbai, addressed Apple India Private Limited’s application for renewing an earlier advance ruling on the classification of Apple Watch and its bands under the Customs Tariff Act, 1975. The applicant sought to classify the Apple Watch under Heading 8517 62 90, attracting a Basic Customs Duty (BCD) of 20%, and the watch bands under Heading 8517 79 90 for non-leather bands and Heading 4205 00 90 for leather bands, attracting BCD rates of 15% and 10%, respectively. The ruling reaffirmed the classification of the Apple Watch under Heading 8517 62 90 due to its primary function as a communication device, aligning with global classifications under the Harmonized System of Nomenclature (HSN). However, the classification of watch bands remained contentious due to an ongoing dispute raised by the customs authorities.
The authority emphasized that the validity of advance rulings is governed by Section 28J of the Customs Act, which limits rulings to three years or until changes in law or facts. Since a Show Cause Notice (SCN) challenging the classification of bands was issued before the current application, the authority ruled the application inadmissible for the disputed matter under Section 28H(2). This decision highlights the interplay between advance rulings, ongoing disputes, and legislative amendments in determining tariff classifications. The ruling provides clarity on the classification of the Apple Watch but underscores the need for further deliberations on the classification of its accessories.
