Case Law Details

Case Name : In re SMI-Amtek Cranshaft Pvt. Ltd (CAAR Delhi)
Appeal Number : Advance Ruling No.- CAAR/Delhi/SMI-Amtek /14/2022
Date of Judgement/Order : 21/11/2022
Related Assessment Year :

In re SMI-Amtek Cranshaft Pvt. Ltd (CAAR Delhi)

CAAR note that the applicants intend to import specially designed, cut-to-shape & size goods said to be mould bases. It is also confirmed by the authorized representative that question posed for advance ruling is not pending before the officer of Customs and no dispute has arisen at any Customs Station, so far, in this regard; the applicant has sought ruling as a matter of precaution. I also note that the concerned Commissioner has opined for classification of the goods in question under CTH 84802000 and further stated that the importer has correctly classified the aforesaid item.

I also note that the question in the application for advance ruling relates to classification of goods proposed to be imported. In this regard, it is felt that guidance of the Harmonized Commodity Description and Coding System of the World Customs Organization, to which India is a signatory, would be useful. It is seen that Explanatory Notes of heading 8480 prescribe that Mould Bases are plates placed in the bottom of the moulds. As per submissions of the applicant in the application for advance rulings, goods in question do not appear to be ready-to-use goods, rather these appear to be incomplete, specially designed, cut-to-shape and size parts which are required to be further worked upon to become ready-to-use parts of the moulds. Since the applicant has stated categorically that these are cut-to-shape and size, as such these goods can not be termed as parts of general use. Moreover, Section Note 2 (b) of Section XVI provides inter-alia that other parts, if suitable for use solely or principally with a particular kind of machine are to be classified with the machines of that kind. Accordingly, the goods in question are not mould bases. These goods are parts of moulds which needs to be worked upon to make it suitable for the designated function to be performed. Thus, in light of the Section Note 2 (b) of Section XVI, the goods in question, merit classification under Sub-heading 84807900.

FULL TEXT OF THE ORDER OF CUSTOMS AUTHORITY OF ADVANCE RULING, DELHI

M/s. SM1-Amtek Cranshaft Pvt. Ltd., Industrial Plot NO. 20,Phase-I, Urban Estate, Dharuhera, Distt.-Rewari, Haryana-123106, a company having PAN AANCS4239H (applicant, in short), has filed an application dated 22.08.2022 seeking advance ruling under section 28-H of the Customs Act, 1962 before the Customs Authority for Advance Rulings, New Delhi (CAAR, New Delhi in short). The application was received in the Secretariat of CAAR, New Delhi on 29.08.2022. The application was accordingly registered under serial No. 19/2022-Delhi dated 29.08.2022.

Mould Base merit classification under Sub-heading 84807900

2.1 The applicant in their application has mentioned that they are engaged in manufacturing of crankshaft and they have sought an advance ruling on confirmation of classification of Mould Base of various sizes under Chapter heading 84802000 of the Customs Tariff Act, 1975. It is further stated that they intend to import Mould Base of specialized alloy steel (DK65M) to be utilized for manufacture of crankshaft.

2.2 A certificate from supplier, M/s Sumitomo Corporation has also been submitted wherein, it is stated that they are supplying specially design, cut to shape and size mould base to the applicant who are manufacturer of crankshaft which are used in automotive industries for supply to OEMs like Maruti Suzuki.

2.3 The applicant also states in the application that mould base merits classification under chapter heading 84802000 of the Customs Tariff Act, 1975; mould base also figure at 8480.20 in terms of Harmonized Commodity Description and Coding System and as regards question for advance ruling, it is stated that they request for confirmation of said classification under subheading 84802000 for the mould base to be imported by them.

2.4 The application for advance ruling also mention that the applicant is manufacturing Crankshaft for four-wheeler passenger vehicles by fabrication of steel bar. The applicant has also submitted a write-up of Crankshaft mould base wherein it is stated that the purpose of importing mould base from Japan is that they require distinctive, specialized quality of mould material-DK65M and they shall be importing such mould bases on regular basis since FY 2022; different processes are carried out on the mould bases, imported from Japan, which include face pocket machining on VMC machine for dieclamping (inhouse); mould cavity machining on VMC machine as per model/NC programming+ejector hole marking up to 20mm depth, engraving (inhouse) and assembly of mould base into bolster for fabrication of steel bar.

3. Following the procedure, comments have been sought from the concerned Commissioner of Customs. The concerned Commissioner of Customs, ICD Patparganj & other ICDs, commented inter-alia that it is evident that it is the ‘Mould Base’ for mould and classifiable under CTH 84802000 as per Customs Tariff Act, 1975, hence, the importer has correctly classified the item.

4. In accordance with the procedure prescribed under the Customs Authority for Advance Rulings Regulations, 2021, personal hearing was scheduled on 09.11.2022. Personal hearing in the matter was attended by Shri Sanjay Saran, authorized representative (AR) wherein he reiterated the submissions already made in the application for advance ruling. The Authority then asked the AR as to whether any dispute has arisen with repsect to classification of the product in question, at any Customs Station. The AR replied that no dispute has arisen at any of the Customs Station, so far, in this regard however, as a matter of precaution, the applicant has sought an advance ruling, in the matter.

5.1 Having gone through the application seeking advance ruling, supporting arguments for classification and comments of the concerned Commissioner of Customs, I summarize the issues in the application for advance ruling. I note that the applicants intend to import specially designed, cut-to-shape & size goods said to be mould bases. It is also confirmed by the authorized representative that question posed for advance ruling is not pending before the officer of Customs and no dispute has arisen at any Customs Station, so far, in this regard; the applicant has sought ruling as a matter of precaution. I also note that the concerned Commissioner has opined for classification of the goods in question under CTH 84802000 and further stated that the importer has correctly classified the aforesaid item.

5.2 I also note that the question in the application for advance ruling relates to classification of goods proposed to be imported. In this regard, it is felt that guidance of the Harmonized Commodity Description and Coding System of the World Customs Organization, to which India is a signatory, would be useful. It is seen that Explanatory Notes of heading 8480 prescribe that Mould Bases are plates placed in the bottom of the moulds. As per submissions of the applicant in the application for advance rulings, goods in question do not appear to be ready-to-use goods, rather these appear to be incomplete, specially designed, cut-to-shape and size parts which are required to be further worked upon to become ready-to-use parts of the moulds. Since the applicant has stated categorically that these are cut-to-shape and size, as such these goods can not be termed as parts of general use. Moreover, Section Note 2 (b) of Section XVI provides inter-alia that other parts, if suitable for use solely or principally with a particular kind of machine are to be classified with the machines of that kind. Accordingly, the goods in question are not mould bases. These goods are parts of moulds which needs to be worked upon to make it suitable for the designated function to be performed. Thus, in light of the Section Note 2 (b) of Section XVI, the goods in question, merit classification under Sub-heading 84807900.

6. I rule accordingly.

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