Actual use controls tariff classification where a compressor spare used in fertiliser processing was excluded from refrigeration equipment.

Tariff classification depended on the actual functional use of the imported cylinder and the nature of the plant in which the compressor operated. Because the compressor was used in a fertiliser process and gas fractionation plant, and was not connected with refrigeration or air-conditioning machinery, it could not be treated as a gas compressor for refrigerating equipment under Heading 84.11(3). The residuary entry in Heading 84.11(1) applied to goods not elsewhere specified, so the spare cylinder was classifiable under that general heading and not the refrigeration heading.

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Issues: Whether a cylinder imported as a spare for an ammonia compressor used in a fertiliser plant was classifiable under Heading 84.11(1) of the Customs Tariff Act, 1975 or under Heading 84.11(3) as gas compressors imported for use in refrigerating equipment.

Analysis: The classification turned on the actual use of the imported item and the nature of the plant in which the compressor operated. The record showed that the compressor was employed in the fertiliser process and in the gas fractionation plant, and was not connected with refrigeration or air-conditioning machinery. On those facts, the import was not a gas compressor for refrigerating equipment. The residuary entry in sub-heading (1) applied to goods not elsewhere specified, and the lower authorities had treated a fertiliser-plant spare as if it were refrigeration equipment.

Conclusion: The imported cylinder for the compressor was classifiable under Heading 84.11(1) and not under Heading 84.11(3); the appeal was allowed in favour of the assessee.

Final Conclusion: The classification adopted by the Revenue was set aside and the assessee was held entitled to assessment under the general entry applicable to compressors not specifically covered by the refrigeration heading.

Ratio Decidendi: For tariff classification, the actual functional use of the imported item governs, and a spare used in a fertiliser process cannot be classified as a refrigeration compressor merely because it is part of a compressor system.

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