Glenmark Pharmaceuticals Limited Vs Commissioner of Customs (Import) (CESTAT Mumbai)
Conclusion: Crimp pumps imported were classifiable under positive displacement pumps (CTI 8413 5010 / 8413 5090) and not as mounts and heads for toilet sprays under CTI 9616 1020 as claimed by the Customs authorities.
Held: Assessee-company had imported crimp pumps used as components in nasal spray devices designed for medicament delivery. Assessee classified the goods under positive displacement pumps and self-assessed the customs duty accordingly. During the audit, Revenue disputed this classification and argued that the goods should be classified under mounts and heads for scent sprays and similar toilet sprays, attracting a higher duty rate of 20%. Following this, Revenue issued a show cause notice proposing reclassification and demanding differential duty, interest, and penalty. Adjudicating Authority confirmed the reclassification under CTI 9616 1020 through the Order-in-Original dated 30.05.2023. Aggrieved by this decision, assessee approached the CESTAT. Assessee contended that the crimp pumps were specifically designed for medical use in nasal sprays for dispensing medicaments and not for scent or cosmetic sprays. It relied on product literature, Harmonized System of Nomenclature (HSN) explanatory notes, which supported classification under Chapter 84 for such pumps. Revenue argued that the pumps had features similar to spray mechanisms used in toilet sprays and justified classification under CTI 9616 1020. Revenue also relied on the General Rules of Interpretation (GIR) 2(a), arguing that the goods, being unassembled articles, should be classified as if they were the finished product. On appeal. It was held that classification should primarily be determined by the terms of the headings, section notes, and chapter notes as per GIR 1. Tribunal explained that GIR 2(a) could not be invoked when classification was clear under GIR 1. Tribunal further observed that the explanatory notes under HSN confirm that pumps for liquids, including those operated by hand, were covered under Chapter 84. Tribunal ruled that the crimp pumps were correctly classifiable under CTI 8413 5010 / 8413 5090 and set aside the order of the adjudicating authority.
