AI TextQuick Glance (AI)Headnote
Issues: (i) Tariff classification of the Motherboard, Chassis and Power Supply Unit proposed for assembly of the Industrial Computing Platform. (ii) Applicability of BIS certification requirements to the Power Supply Unit. (iii) Eligibility of the Power Supply Unit for basic-customs-duty exemption under Serial No. 4 of Notification No. 25/2005-Cus. dated 01.03.2005.
Issue (i): Tariff classification of the Motherboard, Chassis and Power Supply Unit proposed for assembly of the Industrial Computing Platform.
Analysis: Under Rule 1 of the General Rules for the Interpretation of the Import Tariff, classification follows the terms of the headings and the relevant Section and Chapter Notes. The complete Industrial Computing Platform satisfies Note 6(A) to Chapter 84 and is an automatic data processing machine under Heading 8471; however, the separately imported components do not constitute a complete automatic data processing machine. The Motherboard is expressly described under Tariff Item 8473 30 20. The model-specific Chassis, having no independent tariff description and being suitable solely or principally for the Industrial Computing Platform, is classifiable as an other part of a machine of Heading 8471 under Note 2(b) to Section XVI. The Power Supply Unit converts AC power into regulated DC power and has the essential characteristics of a static converter or rectifier. Since it is independently specified under Heading 8504, Note 2(a) to Section XVI requires classification in that heading rather than as a part under Heading 8473.
Conclusion: The Motherboard is classifiable under Tariff Item 8473 30 20, the Chassis under Tariff Item 8473 30 99, and the Power Supply Unit under Tariff Item 8504 40 29 of the First Schedule to the Customs Tariff Act, 1975.
Issue (ii): Applicability of BIS certification requirements to the Power Supply Unit.
Analysis: A Power Supply Unit classified under Tariff Item 8504 40 29 falls within CTH 8504.40. Serial No. 18 of the First Schedule to the Machinery and Electrical Equipment Safety (Omnibus Technical Regulation) Order, 2024 covers power semiconductor converters and their assemblies, sub-assemblies and components under that tariff heading.
Conclusion: The Power Supply Unit is subject to the applicable BIS certification requirements at the time of importation.
Issue (iii): Eligibility of the Power Supply Unit for basic-customs-duty exemption under Serial No. 4 of Notification No. 25/2005-Cus. dated 01.03.2005.
Analysis: Serial No. 4 exempts static converters for automatic data processing machines and their units, excluding static converters for cellular mobile phones. The Power Supply Unit is a static converter intended to provide regulated DC power to the Industrial Computing Platform, which is an automatic data processing machine, and the material does not indicate its use for cellular mobile phones.
Conclusion: The Power Supply Unit is eligible for exemption from basic customs duty under Serial No. 4 of Notification No. 25/2005-Cus. dated 01.03.2005, subject to fulfilment of the prescribed conditions and import-time verification.
Final Conclusion: The ruling determines the tariff treatment, regulatory compliance requirement and duty-exemption eligibility of the proposed imported components according to their respective functions and specific tariff descriptions.
Ratio Decidendi: Under Note 2 to Section XVI, a component independently covered by a specific Chapter 84 or 85 heading is classifiable in that heading, while a component suitable solely or principally for an automatic data processing machine and lacking separate tariff coverage is classifiable as a part of that machine.
Tariff classification of industrial computing components places the power supply unit with static converters, triggering BIS compliance and duty relief.
Tariff classification requires separately imported components to be assessed under their specific headings and the Section XVI notes. The Motherboard falls under Tariff Item 8473 30 20, while the model-specific Chassis, being solely or principally suitable for an automatic data processing machine and lacking independent coverage, falls under Tariff Item 8473 30 99. The Power Supply Unit, as a static converter independently described under Heading 8504, falls under Tariff Item 8504 40 29 rather than as a machine part. Its classification brings it within applicable BIS certification requirements at import. It may also qualify for basic customs duty exemption as a static converter for an automatic data processing machine, subject to prescribed conditions and import-time verification.
Classification of motherboards as parts of automatic data processing machines - Classification of model-specific Industrial PC chassis as parts of automatic data processing machines - Classification of AC-to-DC power supply units as static converters - Customs exemption for static converters for automatic data processing machines Classification of Motherboard as a part of an automatic data processing machine - Classification of the imported Motherboard, without the processor and RAM, intended for assembly of an Industrial Computing Platform - HELD THAT: - The complete Industrial Computing Platform fulfilled the requirements of an automatic data processing machine under Chapter 84. The imported Motherboard, however, did not itself constitute a complete automatic data processing machine, since essential components were to be added subsequently. As the tariff specifically describes motherboards and the article was designed for incorporation in the Industrial Computing Platform, it was classifiable as a part of a machine of Heading 8471. [Paras 10] The Motherboard was held classifiable under Tariff Item 8473 30 20. Classification of model-specific Industrial PC chassis as a part of an automatic data processing machine - Classification of the model-specific Chassis designed to house and support the components of the Industrial Computing Platform - HELD THAT: - The Chassis was neither a generic enclosure nor an article separately specified under Chapters 84 or 85. Its model-specific design, dimensions and configuration established that it was suitable solely or principally for the Industrial Computing Platform, an automatic data processing machine of Heading 8471. It was consequently classifiable under Heading 8473 as a part of that machine, and under the residual entry for other such parts. [Paras 10] The Chassis was held classifiable under Tariff Item 8473 30 99. Classification of AC-to-DC power supply unit as a static converter - Classification of the AC-to-DC Power Supply Unit intended for installation in the Industrial Computing Platform - HELD THAT: - The Power Supply Unit converted incoming AC power into regulated DC power for the electronic components of the Industrial Computing Platform and therefore possessed the essential characteristics of a static converter, namely a rectifier. Since it was independently covered by a specific heading in Chapter 85, Note 2(a) to Section XVI required classification in its own heading rather than as a part of an automatic data processing machine. [Paras 10] The Power Supply Unit was held classifiable under Tariff Item 8504 40 29 and subject to applicable BIS certification requirements at importation. Exemption for static converter used with an automatic data processing machine - Eligibility of the Power Supply Unit for customs-duty exemption as a static converter intended for an automatic data processing machine - HELD THAT: - The exemption depended not merely upon classification under Sub-Heading 8504 40 but also upon the nature and intended use of the static converter. The Power Supply Unit was specifically designed to provide regulated power to the Industrial Computing Platform, which was an automatic data processing machine, and there was no material showing that it was intended for cellular mobile phones. [Paras 10] The Power Supply Unit was held eligible for exemption under Serial No. 4 of Notification No. 25/2005-Cus., subject to fulfilment of its prescribed conditions and verification at importation. Final Conclusion: The Motherboard, Chassis and Power Supply Unit were classified under their respective tariff items based on their individual nature and function in the imported condition. The Power Supply Unit was also held eligible for the claimed customs-duty exemption, subject to the notification conditions, BIS certification requirements and verification at importation.