TaxTMI 
TaxTMI 
TaxTMI 
2024 (3) TMI 1437
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....Applicant has stated as follows in their statement of relevant facts having a bearing on the question(s) raised enclosed with the CAAR-1 application: 2.1 The applicant intends to import the reagent named "QDx InstacheckTM PCT" with reader "QDx InstacheckTM" as a kit i.e., the kit would be imported as one product having both the components i.e., the test cartridge and reader for diagnosis purpose. The kit is a fluorescence immunoassay for quantitative measurement of procalcitonin (PCT) concentration in human whole blood/scrum/plasma for diagnosis of bacterial infection and sepsis. It is for in vitro diagnostic use only. In vitro means elsewhere outside a living organism i.e., this kit is not placed or used inside a human being's body and therefore, these diagnostic reagents are not designed to be administered to the patients. Immunoassays are bioanalytical methods in which the quantitation of the analyte depends on the reaction of an antigen (analyte) and an antibody. One such immunoassay method is used in the product in question for diagnosis. 2.2 The reagent "QDx InstacheckTM PCT" works with the reader "QDx InstacheckTM". The components of QDx InstacheckTM PCT consists of the fo....
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....(other than goods of heading 2937) which are directly involved in the regulation of immunological processes, such as monoclonal antibodies (MAB), antibody fragments, antibody conjugates and antibody fragment conjugates, interleukins, inteferons (IFN) chemokines and certain tumor necrosis factors (TNF), growth factors(GF), hematopoietins and colony stimulating factors (CSF). 3002 Human Blood; Animal Blood Prepared For Therapeutic, Prophylactic Or Diagnostic Uses; Antisera, Other Blood Fractions And Immunological Products, Whether Or Not Modified Or Obtained By Means Of Biotechnological Processes; Vaccines, Toxins, Cultures Of Micro-Organisms (Excluding Yeasts) And Other Similar Products; Cell Cultures, Whether Or Not Modified - Antisera, other blood fractions and immunological products, whether or not modified or obtained by biotechnological processes: 300212 -- Antisera and other blood fractions 30021290 --- Other or 3006 Pharmaceutical Goods Specified in Note 4 To This Chapter Chapter Note 4 : Heading 3006 applies only to the following, which are to be classified in that heading and in no other heading of this Schedule - (d) opacifying prepar....
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....xplanatory Notes Sixth Edition (2017) provides for 'antisera' falling under HSN 3002.12 which reads as under : "Antisera are obtained from the blood of humans or of animals which are immune or have been immunized against diseases or ailments, whether these are caused by pathologic bacteria and viruses, toxins or allergic phenomena, etc. Antisera are used against diphtheria, dysentery, gangrene, meningitis, pneumonia, tetanus, staphylococcal or streptococcal infections, snake bite, vegetable poisoning, allergic diseases, etc. Antisera are also used for diagnostic purposes, including in vitro tests. Specific immunoglobulins are purified preparations of antisera" In a similar case of Span Diagnostics Ltd. v. Commissioner of C. Ex., Surat, 2007 (211) E.L.T. 521 (S.C.) Supreme Court observed in para 36 that Chapter Heading 3002 refers to 'blood fractions'. Merely because the medium used is latex (rubber) or paper, will not bring the items under Chapter Heading 3822. Once an item is a blood fraction it falls under Chapter Heading 3002. The medium is irrelevant. The medium could be paper or rubber. The configuration of the product and the function are important. In the present case, t....
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....noassay diagnostic kit which has essential characteristics of antisera containing monoclonal anti-body used as diagnostic reagent. 4. The Jurisdictional Commissionerate of Customs i.e. Air Cargo Complex, Mumbai responded to the application which is reproduced as under: 4.1 As per submissions made by the Applicant, QDx InstacheckTM PCT reagent is also accompanied with QDx InstacheckTM reader and to be imported as single unit for in-vitro diagnostic use only. Further, as per the catalogue/Literature of "QDx InstacheckTM PCT" - it is consists of a 'Cartridge', an 'ID Chip' and a 'Detection Buffer Tube'. Wherein all the components of reagent are having their individual importance and essential character of the kit is diagnosis and same will be determined by 'Cartridge', 'ID Chip', 'Detection Buffer Tube' and QDx InstacheckTM reader as a whole. The detection buffer pre-dispensed in a tube contains fluorochrome-labeled anti-PCT antibodies, fluorescent-labeled anti chicken IgY, bovine serum albumin (BSA) as a stabilizer and sodium azide in phosphate buffered saline (PBS) as a preservative. Therefore, it appears that goods under consideration are not reagent but accompanied with reade....
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....ORY REAGENTS WHETHER OR NOT ON A BACKING, WHETHER OR NOT PUT UP IN THE FORM OF KITS, OTHER THAN THOSE OF HEADING 3006; CERTIFIED REFERENCE MATERIALS". Also relevant explanatory notes to CTH 3822 are reproduced below : The reagents of this heading should be clearly identifiable as being for use only as diagnostic or Laboratory reagents. This must be clear from their composition, labelling, instructions for in vitro or laboratory use, indication of the specific diagnostic test to be performed or physical form (e.g., presented on a backing or support). Diagnostic kits based on reactions such as agglutination, precipitation, neutralization, binding of complement, haemagalutination, enzyme-linked immunosorbent assay (ELISA), etc. are classified here. Malaria diagnostic kits, for example those based on monoclonal antibodies to pLDH (plasmodium lactate dehydrogenase), are also classified here. The applicant has specifically mentioned in his application that the goods/kit under consideration will be used for diagnosis purpose. Further, applicant has also submitted that the diagnostic kit is based on monoclonal antibodies; thus, kit works on precipitin reaction (i.e. interaction of ....
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....edients in the blood to detect the disease/infection/disorders etc. They further contended that the said goods merit classification under Customs Item-30021290. They also relied upon Customs Notification 50/2017 Sr. No. 166 A List-84 and GST Notification/Central Tax 1/2017 Sr. No. 180 entry No. 84. They also filed additional submissions and referred case law in the matter of Span Diagnostics Limited v. CCE Surat and COEN Bharat Ltd. v. CCE Vadodara in support of their claim. The department in their written submission contended that the subject goods should fall under CTI-38229090. The applicants have put their views against the department contention in their submission dated 20-2-2024 and submitted a copy of product description QDx Instacheck TSH & PCT for clarification. Nobody appeared from department for said Personal hearing cither online or in person. 6. The contents of the additional submissions dated 20-2-2024 submitted by the applicant during the Personal hearing is as under : * The Pack Insert of Diagnostic Kit provides as under : COMPONENTS AND REAGENTS "The detection buffer pre-dispensed in a tube contains fluor....
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....tes and antibody fragment conjugates, interleukins, interferons (IFN), chemokines and certain tumor necrosis factors (TNF), growth factors (GF), hematopoietins and colony stimulating factors (CSF)" The present case is of "antisera, other blood fractions and immunological products, whether or not modified or obtained by means of biotechnological processes" In view of the above, we request you to pass a suitable Advance Ruling that the kit shall be classified under Chapter 3002 and shall be liable to IGST rate of 5% considering it to be fluoro immunoassay diagnostic kit. 7. I have taken into consideration all the materials placed on record in respect of the subject goods including the submissions made by the applicant during the course of personal hearing. I have gone through the response received from the Customs Commissionerate i.e. Air Cargo Complex, Mumbai and the rebuttal to that filed by the applicant. I therefore proceed to decide the present applications regarding classification of "QDx InstachcckTM PCX" with reader "QDx InstacheckTM" as a kit on the basis of the information on record as well as the existing legal framework having bearing on the classification of the produ....
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.... the sample-loaded test cartridge immediately. 8. Read the test result on the display screen of the QDx InstacheckTM Reader. From the above mentioned test procedures it is amply clear that without the use of QDx InstacheckTM Reader diagnosis is not possible. Further, to achieve the purpose i.e. to find out the PCT concentration in specimen/the patients' blood samples QDx InstacheckTM Reader is an indispensable component in the said diagnosis Kit and without QDx InstacheckTM Reader this Kit is not complete or self-contained. 'Select' button on the QDx Instacheck Reader is to be pressed to start the scanning process and furthermore, the test result will be read from the display screen of the QDx InstacheckTM Reader. Therefore, without QDx InstacheckTM Reader scanning of the sample and getting the result for further study is unimaginable and futile. Detection buffer tube, test cartridge and QDx InstacheckTM Reader have to be used collectively to achieve the purpose of diagnosis be it single mode or multi-mode test procedures. Furthermore, the last point of 'Warnings and Precautions' mentioned in the said brochure submitted by the applicant as exhibit reads thus : "QDx Inst....
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....e Headings of the Tariff and may be used as a safe guide for the same. It has been held so by the Supreme Court in the case of Collector of Customs, Bombay v. Business Forms Ltd. Thr. O.L., 2002 (142) E.L.T. 18 (S.C.). The classification of the goods under the Customs Tariff is governed by the principles as enumerated in the General Rules of Interpretation ('GRI') set out in the First Schedule to the Customs Tariff Act, 1975 (Tariff). In view of the Rule 1 & Rule 3(a) of the General Rules of Interpretation to answer the question of classification of the products under consideration asked by the applicant, provisions of the relevant Section or Chapter Notes and Sub-Notes or explanatory notes are to be interpreted considering that the goods in question comprise "Reagent", however, they are put up in the form of Kit which gives essential character to the products. Sections and Chapter Notes have been given statutory backing and have been incorporated at the top of each Section/Chapter. Explanatory notes to Heading 3822 explains that this heading covers diagnostic or laboratory reagents on a backing, prepared diagnostic or laboratory reagents whether or not on a backing, whether or n....
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....gnostic kits, for example those based on monoclonal antibodies to pLDH (plasmodium lactate dehydrogenase), are also classified here". The process applied in this mechanism as can be seen in para 2.3 above, the applicant has contended the test uses a sandwich Immunodetection method which is based on antibody-antigen reaction with fluorescent technology and the detector antibody in buffer binds to PCT in serum sample. Hence, the diagnostic Kit having mechanism of 'binding of complement' are correctly covered under Chapter Heading 3822. I find that there are specific tariff entries for prepared diagnostic reagent whether or not put up in the form of kits meant for certain diseases viz. malaria and zika, blood grouping and pregnancy test. All other prepared diagnostic or laboratory reagent whether or not put up in the form of kits are covered under residuary Tariff Item 3822 9090. 12. I have gone through the Notification No. 1/2017-Integrated tax (Rate), dated 28th June, 2017 and the Circular No. 163/19/2021-GST, dated 6-10-2021 issued by Tax Research Unit regarding clarification of GST rates & classification of goods based on the recommendations of the GST Council wherein it is cl....