TaxTMI 
TaxTMI 
2024 (9) TMI 944
X X X X Extracts X X X X
X X X X Extracts X X X X
.... be under CTH 84159000. The lower authority after following the due process and a detail analysis of the imported goods classified them under CTH 84159000 as parts of air-conditioning machines and confirmed the demand of differential duties amounting to Rs.2,07,850/-. Aggrieved by the said order, the appellant preferred an appeal before Commissioner (Appeals). The lower appellate authority rejected the appeal filed by the appellant. Hence the present appeal. 3. Shri Rohan Muralidharan, learned Advocate appeared for the appellant and Shri M. Selvakumar, learned Authorized Representative (AR) appeared for the respondent. 3.1 The Ld. Advocate for the appellant submitted that the issue in the present case pertains to classification of 'COMPR & CL ASY A/C (Motor vehicle components)' which are compressors imported by the appellant for use in air conditioners fitted in 'B299 New Fiesta Model Car'. He stated that they are not disputing the fact that the subject goods are used in air-conditioners of passenger cars. The primary purpose of the unit is to draw the low-pressure and low-temperature vapor from the evaporator and compress this vapor into high-temperature, high pressure vapor....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd the compressor should be put to use in Industrial applications. On the contrary, under heading CTH 8415 9000 there is a specific entry i.e., parts of air-conditioning machines for use in the motor vehicles. In as much as the impugned parts are admittedly used in car air-conditioners whose main function is to control temperature/changing temperature and humidity, the most appropriate classification of the impugned goods. would be under CTH 8415 9000. Moreover, as per the explanatory note to sub-heading 841590 of HSN, "the components of air-conditioning machines, if presented as separate elements are classified in accordance with the provisions of Note (2)(a) to Section XVI whether or not they are designed for building into a self-contained unit". Therefore, the imported items being car air conditioning compressor, they are rightly classifiable under CTH 8415 9000. He further placed reliance on the ratio of the judgment of the Hon'ble Supreme Court in Westinghouse Saxby Farmer (Supra) and averred that the 'predominant use' or 'sole/ principal' use test would have to be given importance going by which the compressors which are parts used in automobile air conditioning m....
X X X X Extracts X X X X
X X X X Extracts X X X X
....; ventilating or recycling hoods incorporating a fan, whether or not fitted with filters; gas-tight biological safety cabinets, whether or not fitted with filters 841480-Other : --- Gas compressors: " 10% 84148011 ----Of a kind used in air-conditioning equipment u 7.5% 84148019 ---- Other u 7.5% 84148020 --- Free-piston generators for gas turbine u 7.5% 84148030 --- Turbo charger u 7.5% 84148090 --- Other u 7.5% 841490 - Parts : --- Of air or vacuum pumps and compressors: 84149011----Of gas compressors of a kind used in refrigerating and air conditioning appliances and machinery kg. 7.5% 84149012 ---- Of bicycle pumps kg. 10% 84149019 ---- Other kg. 7.5% 84149020 --- Of free piston generators kg. 7.5% 84149030 --- Of electric fans kg. 10% 84149040 --- Of Industrial fans, blowers kg. 7.5% 84149090 --- Other kg. 7.5% 5.2 It is seen that Heading 8415 covers Air-conditioning machines, comprising a motor-driven fan and elements for changing the temperature and humidity, including those machines in which the humidity cannot be separately regul....
X X X X Extracts X X X X
X X X X Extracts X X X X
....their respective headings i.e. CTH 8415 9000 as "parts" of air-conditioning machines of a kind used for persons in motor vehicles. 5.5 The appellant is also of the opinion that only those parts which are not classifiable under Section Note 2(a) will be classified in terms of Note 2(b) and Note 2(c). They however aver that the impugned air compressors are also a kind of a gas compressor. Heading 8414 itself reads as "Air Compressors and other Gas Compressors" which clearly indicates that an air compressor is also a kind of gas compressor. The appellant draws attention to HSN Explanatory Notes to Section XVI which reads as follows: "(II) PARTS (Section Note 2) In general, parts which are suitable for use solely or principally with particular machines or apparatus (including those of heading 84.79 or heading 85.43), or with a group of machines or apparatus falling in the same heading, are classified in the same heading as those machines subject, of course to the exclusions mentioned in Part (I) above. Separate headings are, however, provided for: ..... The above rules do not apply to parts which in themselves constitute an article covere....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ression; alternatively, it can be said that where a statute contains both a general provision as well as a specific provision, the latter must prevail. 5.9 Further the Customs Tariff is based on Harmonized System of Nomenclature ("HSN") and the explanatory notes thereto. Therefore, HSN along with the explanatory notes provide a safe guide for interpretation of an Entry. The Hon'ble Supreme Court in its judgment in Commissioner of Customs and Central Excise, Amritsar (Punjab) Vs. D.L. Steels etc. [2022 SCC Online SC 863] stated as under; "9. The Harmonised System of Nomenclature, developed by the World Customs Organisation, has been adopted in India by way of the Customs Tariff Act, 1975, though there are certain entries in the Schedules to this Act which have not been assigned HSN codes. The Harmonised System is governed by the International Convention on Harmonised Commodity Description and Coding System, which was adopted in 1983, and enforced in January, 1988. This multipurpose international product nomenclature harmonises description, classification, and coding of goods. While the primary objective of the HSN is to facilitate and aid trade, the Code is also extensiv....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d V.P. Latex. This, according to Mr. Sanghi, clearly shows how the appellants themselves have understood the matter. There is, however, no estoppel in law against a party in a taxation matter. In order to clear the goods for the Customs, the appellant Agents may have given the classification in accordance with the wishes of the authorities or they may even be under some misapprehension. But when law allows them the right to ask for refund on a proper appraisement and which they actually applied for, we do not attach any significance to this aspect of the matter pointed out by counsel. The question is of general importance and must be decided on its merits." (emphasis added) 7. Whether the 'predominant use' or 'sole or principal' use test stated in Westinghouse Saxby Farmers (supra) will be applicable to the present case. 7.1 Revenue states that in Westinghouse Saxby Farmers (supra), the Hon'ble Supreme Court has applied the "sole or principal use" test as the exclusive test to determine whether an article should be classified as a "part of accessory" under Section XVII. Applying the same ratio to the facts of this case the impugned goods, which are undisputedly parts....