In re Endress+Hauser (India) Pvt. Ltd. (CAAR Mumbai)
Applicant seek classification of Import of Corolis flowmeter with order code Cubemass C100, C300, C500, Corolis flowmeter with order code Dosimass, Corolis flowmeter with order code Promass A100, A200, A300 and A500, Corolis flowmeter with order code Promass E100, E200,E300 and E500, Corolis flowmeter with order code Promass F100, F200 and F500, Corolis flowmeter with order code Promass H100, H300 and H500, Corolis flowmeter with order code Promass I100, I300 and I500, Corolis flowmeter with order code Promass O100, O300 and O500, Corolis flowmeter with order code Promass X300 and X500, Corolis flowmeter with order code Promass P300 and P500, Corolis flowmeter with order code Promass Q300 and Q500 and Corolis flowmeter with order code Promass S100, S300 and S500
The applicant has contended that their flowmeters are only measuring devices. They neither contain a controlling device, nor a starting, stopping or operating device. Therefore, the imported products do not fulfil the criteria set out in the USN Explanatory Notes for classification under Heading 90.32. The principal function of the flowmeters is to measure the process parameter of flow. It is possible the output from these flowmeters may then be used for giving input to an independent process control system or process controller which compares the signal received with desired measurements and sends a control command or signal. The flowmeter may have facilities for providing a digital output to just ensure that the end user can integrate the flowmeter with other controlling apparatus to suit their needs. However, it is necessary to make a distinction between the measuring instrument and the control system, which acts on the measured variable. Automatic regulating or controlling instruments are designed to bring a factor, such as flow to, and maintain it, at a desired value, by constantly or periodically measuring its actual value. The products covered in the present applications are flowmeters only. They are not part of control systems and are distinct from the control systems. They are operable as standalone devices classifiable under heading 90.26 as simple measuring devices. They cannot be treated as parts of control devices and can operate without any control system at the customers’ end. Before coming to this conclusion, I have carefully considered the findings of the ld. Commissioner(Appeals) who dealt with the import of Liquiphant and other measuring instruments. It appears that Id. Commissioner(Appeals) have considered some investigation carried out by the Director General of Audit which came to the conclusion that the final product manufactured by the appellant is not merely measuring instrument and it is in fact a part of automatic regulating or controlling apparatus under heading 90.32 of Central Excise Tariff Act, 1985. The appellate order also considers the catalogue submitted by the appellant of products and came to the conclusion that these devices contain sensors, micro processor, transmitters, amplifiers, relays etc. along with software and that such devices also have inbuilt software known as HART PROFIBUS PA/DP, Foundation Fieldbus and others which makes the resultant product suitable for two way communication and process control. A conclusion has also been drawn that these devices have time saving local operation system without additional software and hardware and also have integrated web server, and therefore, can convert analogue signals into digital or electrical signals which are amplified further to desired strength and then are transmitted to process controller. Therefore, it has been held that the final equipment is suggested to have facility of configuration of parameters to be controlled and the parts and accessories imported by the appellant are to be used for sophisticated functional units which directly participate in process control. On the basis of the above understanding, the Id. Commissioner(Appeals) has upheld classification of Liquiphant and other flowmeters and has also denied the benefit of exemption. However, I am unable to agree with the conclusions of the Id. Commissioner(Appeals) in holding that the imported goods were parts and accessories for manufacture of automated process control systems. As I have already observed earlier in this ruling, classification has to be decided on the basis of the state of goods at the time of import and any subsequent activity shouldn’t influence the classification decision. This also is the view of the Hon’ble Supreme Court in the case of M/s. Sony India, reported at 2008 (231) E.L.T. 385 (S.C.) apart from the ruling in the case of M/s Dunlop India vs U01— 1983 (13) ELT 1566 (SC) cited by the applicant. Therefore, I am unable to agree with the conclusions of the Id. Commissioner(Appeals) and hold that even though it is possible that some of the flowmeters proposed to be imported by the applicant can be used in a system to control and regulate process parameters, these flowmeters, by themselves, are not automatic controlling and regulating apparatuses.
