In re Mitsubishi Electric India Private Limited (CAAR Delhi)
The Customs Authority for Advance Rulings (CAAR), Delhi considered three applications relating to the import of components of a Driver Monitoring System (DMS) from Japan, namely Cable, Unit Assembly and Controller Assembly. The applicant sought advance rulings on the appropriate tariff classification of each component under the First Schedule to the Customs Tariff Act, 1975, and their eligibility for exemption under Notification No. 69/2011-Customs dated 29.07.2011. The Port Commissionerate concurred with the applicant’s proposed classifications, and the applications were held to be valid under the Customs Act, 1962 and the CAAR Regulations, 2021.
The Authority first examined the nature of the DMS. It observed that the DMS is an in-cabin automotive safety system comprising three principal components: the Unit Assembly, which captures the driver’s visual inputs; the Cable, which connects the Unit Assembly and the Controller Assembly; and the Controller Assembly, which processes the captured data. The processed information is transmitted to the vehicle’s Body Control Module (BCM), which ultimately activates alerts through a buzzer or indicator lamp. None of the three components independently performs a signalling or safety function.
With respect to the Cable, the Authority found that it is a PVC-insulated electric cable fitted with connectors at both ends, designed to transmit data and power between the Unit Assembly and the Controller Assembly. Heading 8544 specifically covers insulated electric conductors fitted with connectors, and CTH 8544 42 20 expressly covers plastic-insulated conductors fitted with connectors for a voltage not exceeding 1,000 volts. Applying Section Note 2(a) of Section XVI, the Authority held that where goods are specifically covered by a tariff heading in Chapter 84 or 85, they must be classified in that heading irrespective of their end use. Since Heading 8544 specifically covers the imported Cable, it remained classifiable under CTH 8544 42 20. As the Cable imported from Japan falls within sub-headings covered by Serial No. 733 of Notification No. 69/2011-Customs, it was also held eligible for the customs duty exemption under that notification.
