TaxTMI 
TaxTMI 
2025 (12) TMI 891
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...., 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 accordingly registered under Serial No. 104/2025 dated 20.06.2025. 1.1 The applicant, vide the aforesaid application, has sought ruling on the question of classification of the proposed items of import namely (i) Air Conditioning Unit GF 50 (CTH88073010) (ii) Air Start Unit GS 400 (CTH 88073010). 1.2 The applicant has further stated that the activity of importation of the aforementioned goods is yet to commence by them. Vide the said application the applicant has preferred advance ruling for classification of items i.e air conditioning unit GF 50 and air start unit GS 400 solely used in aircraft's operation on ground under heading 8807. 1.3 The information provided by the applicant as regards the goods in question is as under: 1.3.1 The applicant are engaged in providing ground handling services also known as ground support services to aircraft during their ground operations/requirements of various Indian and foreign airlines at different airports. The applicants services interalia include p....
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....a. Technical Details of Air Start Unit GS type for aviation operation - Wide Body Air Start Unit. b. Down payment receipt dated 28.03.2025 c. Purchase Order PO/DL/2425/000244 dt.05.09.2024. 1.4.4 The applicant's submissions in respect of Item No.1 ACU are as follows :- (a) ACU is used for supply of preconditioned Air to the Aircraft on the ground when aircraft engines are not running. the ACU also meets the requirement of proper ventilation cold or heated air in the aircraft. (b) The ACU also maintains the electronic components of the Aircraft in good condition which would otherwise lead to heavy maintenance and also can lead to discomfort to the people on board. in other words it maintains the safety of the cabin interior. (c) Keeping the Aircraft APU (Auxiliary Power Unit) running for such long hours to maintain the Air conditioning system of the aircraft is not viable and suitable as the long running of the APU can not only be commercially expensive but also create a higher pollution rate disturbing the environment at a higher level in comparison to the use of the ACU run externally would definitely produce less pollution in co....
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....thereby functioning as a pall of the aircraft. (o) In this background. An external unit plays a vital role in maintaining aircraft functionalities while it is on ground while at the same time reducing consumption of ATF and reducing carbon footprint and noise of an aircraft. (p) It consistently works in a Open loop with a constant flow of necessary required temperature controlled air which is not at all similar to any generic air conditioner. 1.5 The applicant's submissions in respect of Item No.2 ASU are as follows :- (a) That the manufacturer M/s GUINAULT France is engaged in manufacturing ground support equipment only for aircraft's various functions on ground when aircraft engine are not running. The details of support provided by ASU to the aircraft on ground when engines are not working are as follows. (b) ASU are an essential ground support equipment specially and very specifically designed to provide the necessary pressurized /compressed air to start the aircraft engines only while they are on ground. (c) The Air starter Unit (ASU) is used in conditions whenever the Aircraft APU (Auxiliary Power Unit) is switched off w....
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....further submitted that on the basis of the facts and details of goods submitted by them it is established that the goods for which advance ruling is being sought are "Parts and Accessories of Aircraft Classifiable under Tariff Item 88073010, being other parts/accessories of aircraft/aero planes classifiable under TI 8802. Note 3 of section 17 of Customs Tariff and TI 8807 are reproduced below for ready reference. "8807: 8807 Parts of goods of heading 8801, 8802 or 8806 8807 10 00 Propellers and rotors and parts thereof 8807 20 00 Under-carriages and parts thereof 8807 30 00 Other parts of aeroplanes, helicopters or unmanned aircraft 8807 30 Other parts of aeroplanes, helicopters or unmanned aircraft : 8807 30 10 Of aeroplanes, helicopters 8807 30 20 Of unmanned aircraft 8807 90 00 Other 1.7 SECTION XVII VEHICLES, AIRCRAFT, VESSELS AND ASSOCIATED TRANSPORT EQUIPMENT Note 3: 3. References in Chapters 86 to 88 to "parts" or "accessories" do not apply to parts or accessories which are not suitable for use solely or principally with the articles of those Chapters. A part or accessory which answe....
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....lassifiable as part of the aircraft under heading 8803. CC Vs MAK CONTROLS & SYSTEMS (P) LTD. 2007 (211) E.L.T. 123 (Tri. - Chennai): Para 1 of the judgement is extracted below for ready reference: "The short question arising for consideration in this appeal of the Revenue is whether the benefit of Notification No. 23/98-Cus. dated 2-6-1998 (SI. No. 223 of the Table annexed thereto) was admissible to the compressor imported by the respondents during the material period. Learned Commissioner of Customs extended the benefit to the party in view of the decision of this Bench in an earlier case of the same party reported as Mak Controls v. Commissioner of Central Excise, Coimbatore - 2001 (138) E.L.T. 1152, (Tri. - Chennai), wherein alternator and other electronic items which were found to be parts of Ground Power Unit which in-turn was found to be part of aircraft were held to be eligible for the benefit of Notification No. 65/93-C.E. which granted exemption to parts of aircraft. The department, in the present appeal, states that the Commissioner's decision is not legal or correct inasmuch as a civil appeal filed by them against the above decision of the Tribunal was admi....
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....ngs of those Chapters is to be classified under that heading which corresponds to the principal use of that part or accessory. It has already been discussed that the Unit can only be termed and considered as a part of aircraft which replaces the on-board APU and is suitable for use solely and principally with aircrafts falling under Chapter 88 and is not hit by the exclusion provision of the notes to Section XVII. In view of my aforesaid discussions, I rule that APU OFF combo unit merits classification under chapter sub-heading 8803 30 00 of the First Schedule to the Customs Tariff Act, 1975. 1.11. In light of above, the applicant has submitted that not only the ground support equipment of aircraft, but also the parts imported for manufacture of ground support equipment (solely used in such ground support equipment) are classifiable as parts of aircraft. Accordingly, requested for for advance ruling for classification of items mentioned i.e Air Start Unit and Air Conditioning Unit solely used in aircraft's operation on ground under heading 8807. 2. Comments of The Port Commissionerate :- 2.1 The comments in respect of this application from the concerned port Commission....
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....or air conditioning offices, hoes, public halls, ships, motor vehicles etc, and also in certain industrial installations requiring special atmospheric conditions. (c) As per the applicant's submissions, Air craft Air Conditioning Unit proposed to be imported by them is used for supply of preconditioned Air to the Aircraft on the ground when aircraft engines are not running. The ACU also meets the requirement of proper ventilation cold or heated air in the aircraft. (d) Also, Rule 3 of General Rules for interpretation of the Harmonized System which interalia states that: When by application of Rule 2 (b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows: (a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one ....
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....M Sharma, A.R., CA Pooja Agarwal, A.R. Sh. Vikas Sharma, A.R, Mr. Sanjay Sawant, A.R attended the same and reiterated the same which were already submitted with the application of the applicant. They further informed that they got the port comments in short notice and require some tie to file rebuttal. Accordingly they sought some time to file the rebuttal against the port comments. 4. Additional Submission: At the time of personal hearing conducted on 01.09.2025, the applicant has submitted some additional submission. The same is reproduced as under: S. N. DETAILS OF GOODS CLASSIFICATION SOUGHT 1. Air start unit GS 400. Other parts of aircraft Heading 88073010. 2 Air conditioning unit GF 50. Other parts of aircraft Heading 88073010. 4.1. AIR START UNIT GS 400 Understanding Air Starter Units (ASUs) Technical Description and Operational Function :- Like any other machine, an aircraft requires power for its operations. The aircraft of commercial airlines operate in the air, as well as on the ground and source their power requirements: a. From aircraft's own engines. b. From Auxiliary Power Unit (APU) of the aircraf....
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....in Chapter 88, several headings are relevant to the ASU classification: ICT Heading 8802: This heading encompasses "Other aircraft (for example, helicopters. aeroplanes); spacecraft (including satellites) and suborbital and spacecraft launch vehicles". This heading represents the "principal product" (aeroplanes/helicopters) to which the Air Starter Unit (ASU) is functionally linked, as its primary purpose is to enable the operation of these aircraft. 4.3.1.3 ICT Heading 8803: Historically, this heading described "Parts of goods of heading 8801 or 8802". It's subheadings included - ⮚ "Propellers and rotors and parts thereof" (880310), ⮚ "Under-carriages and parts thereof" (880320), ⮚ "Other parts of aeroplanes or helicopters" (880330) ⮚ and a residual "other" category (880390). 4.3.1.4 That ICT Heading 8803 was deleted in 2022 and it's scope was largely transferred to Heading 8807 as follows: ⮚ "Parts of goods of heading 88.01, 88.02 or 88.06" (8807). Heading 88.06 was concurrently introduced to specifically cover "Unmanned aircraft" (drones). 4.4 Interpretation of term "Parts" ....
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....rion is applicable." 4.5.2 That as per Rule 3(a) the heading providing that the most specific description shall be preferred. This principle directs classification of goods towards the heading that most accurately captures the product's primary role. An ASU, being specifically designed and dedicated for aircraft engine starting, is appropriately described as a "part of aircraft". The specificity of its function for aircraft outweighs its general mechanical or electrical components. 4.5.3 Rule 3(b) (Essential Character for Composite Goods) also supports classification of ASUs under heading, 88073010, in as much as, it states that for goods consisting of different materials or components, classification is based on material or component that gives the goods their "essential character". For ASUs, while they are composite machines containing - a compressor, engine, and control systems etc; their essential character is derived not from these individual components in isolation, but from their highly specialized and dedicated function of providing the necessary pneumatic power to start aircraft engines. The ASU is not a general- purpose compressor; it is only used for aircraft s....
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....to the function of APU. Therefore, by applying the General Interpretative Rules, particularly Rule 3(a) Rule 3(b) (Essential Character) and Rule 4 (akin goods) as explained above, ASUs should be classified as "parts of goods of heading 8802" under TI 8807 (which covers other parts of aeroplane). (c) That the specialized characteristics of ASUs support for their classification under Chapter 88: i. Specialized Design for Aircraft Pneumatic Systems: ASUs are not generic air compressors. They are meticulously engineered to deliver precise pressure and flow rates (PPM) that are specifically tailored to the pneumatic starting requirements of various aircraft engines. Their design adheres to. stringent aviation industry standards further underscoring their highly specialized nature and dedicated purpose within the aviation ecosystem. This level of specialization is not found in general purpose compressors or other general purpose electrical ignition/starting systems. ii. High-Pressure Air Delivery tailored to Aircraft Engine Requirements: The primary and defining function of an ASU is to provide the "jet start" necessary for aircraft engines. This is a highly sp....
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....arter system, which is a broader and external role than the electrical components covered by 8511. The ASU's operational mechanism relies on compressed air delivery, making it distinct from the electrical ignition components enumerated in HSN 8511. That in the case of Interglobe Aviation Limited vs Principal Commissioner, Customs-New Delhi (Supra). The Hon'ble Tribunal rejected classification of 'aircraft engine stand' under Heading 8716 applicable to trailers & semi trailers etc. and held the same to be classifiable under heading 8609 as 'container specifically designed for carriages' emphasizing that the good's "essential character" was its holding/protective function for engine, not its wheels for movement. The applicant humbly submits that the above judgement directly support applicants view that the ASU's essential character is 'aircraft-starting function', overriding its incidental mobility or the presence of a compressor. The decision in the case of Interglobe (Supra) is highly persuasive for the ASU's classification under Chapter 88. The strength of legal precedent lies not only in identical facts but, more impor....
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....lters are used in order to deliver clean air to the aircraft. The air inlet is located on the opposite side of engine exhaust in order to ensure clean air supply to ACU. It is also located on the upper part of the unit to avoid suction of dirty/ dusty air from the ground. The air filters are mounted on metallic frame for easy cleaning and/or replacement". Please refer pg 26-35 of Application. 4.7.2.3 A perusal of technical description of air conditioning unit show that the manufacturer's are engaged in designing and manufacturing only aircraft ground support equipment, namely APU- OFF solutions including GPU, ASU & AACU, which are substitute to aircraft's inbuilt APU. The ground support equipment provide power solutions to the aircraft for their ground operational requirements. 4.8 Classification of AACU: 4.8.1 Indian Custom Tariff (ICT) Chapter 88: Aircraft, Spacecraft, and Parts Thereof: That Chapter 88 (pages 61-63- of application) of Indian Customs Tariff covers aircraft, spacecraft and its parts thereof. Relevant Tariff Entries are as follows i. Heading 8801, 8802 & 8806 cover non powered aircraft, other aircraft and unmanned aircraft respectively. ....
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....terial period. Learned Commissioner of Customs extended the benefit to the party in view of the decision of this Bench in an earlier case of the same party reported as Mak Controls v. Commissioner of Central Excise, Coimbatore - 2001 (138) E.L.T. 1152, (Tri. - Chennai), wherein alternator and other electronic items which were found to be parts of Ground Power Unit which in-turn was found to be part of aircraft were held to be eligible for the benefit of Notification No. 65/93-C.E. which granted exemption to parts of aircraft. The department, in the present appeal, states that the Commissioner's decision is not legal or correct in as much as a civil appeal filed by them against the above decision of the Tribunal was admitted by the Supreme Court. After hearing both sides and considering their submissions, we find that the above civil appeal has been dismissed vide Commissioner v. Mak Controls-2005 (183) E.L.T. 473 (S.C.) In view of above decision of apex court, the view taken by the appellant that a compressor being part of ground power unit cannot be treated as a part of aeroplane cannot be sustained." b. MAK CONTROLS Vs. COMMISSIONER OF CENTRAL EXCISE, COIMBA....
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....assifiable under sub-heading 8803 of Schedule to Central Excise Tariff Act, 1985 as a `part' of an aircraft and is therefore eligible to the duty exemption contained in Notification No. 65/93-C.E. The impugned order-in-original is set aside and the appeal succeeds accordingly." In above case the GPU providing power to the aircraft when the aircraft is on ground was considered as a "part" of an aircraft and the above view was affirmed by Hon'ble Apex Court vide order reported in Commissioner vs Mak Controls - 2005 (183) E.L.T. A73 (S.C.)]. Thus, the said classification is binding on departmental authorities. c. Advance Ruling No. CAAR/Mum/ARC/01/2022, dated 6-1-2022 in Application No. CAAR/CUS/APPL/72/2021-O/o Commr-CAAR-MUMBAI IN RE: ALVEST MILLENNIUM AVIATION LEASING IFSC PVT. LTD. Reported in 2022 (381) E.L.T.558(A.A.R. - Cus. - Mum.) In this case similar items ACU was classified under chapter 88 Para 13 of the said Advance Ruling is reproduced below: "13. Having taken a view that the Unit would merit classification under Chapter 88, now I turn my attention to the issue of its exact heading and sub-heading. Chapter 88 covers balloons and dirigib....
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....t, 1975 in view of Section XVII Note 3 of Chapter 88 ibid and eligible for benefit of exemption underNotificationNo.298/76-Cus. 5. During the Personal hearing held on 01.09.2025, the applicant reiterated submissions and sought time to file rebuttal, which was subsequently filed as an additional submission vide mail dated 11.09.2025. The same is reproduced as under: 5.1 The personal hearing in the subject matter was held before Hon'ble CAAR on 01.09.2025 at 4:00 PM. During the course of hearing, the Hon'ble CAAR was kind enough to give 7 days' time to the applicant to submit written response to the department's comments dated 26.08.2025, particularly with regard to Aircraft Air-conditioning Unit (AACU), as the department has not disputed the classification of Aircraft Air Start Unit (in para g of the comments) under Heading 88073010, as proposed by the applicant. 5.2 Accordingly, the applicant is making present submissions in respect of Aircraft Air- conditioning Unit (AACU) only. i. That the department's comments regarding classification of AACU under Heading 84.15 are re-produced below: "(a) In this regard, refer to CTH8415 of the Cus....
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....The department has not specified the exact 8-digit classification for AACU, while disputing the classification proposed by the applicant, to enable the applicant to make suitable submissions. The applicant submits that there is no specific entry in CTH 8415 to cover AACU specifically manufactured as "Ground Support Equipment for aircraft's ground operations" b) That department, in their comments, has relied upon Explanatory Notes of CTH 8415; however, a copy of the Explanatory Notes of CTH 8415 has not been provided to the applicant. That the appellant has gone through CTH 8415 of Customs Tariff Act and has not been able to locate any such explanatory notes. In any event, as per Explanatory note extracted in department's comments - heading 8415 covers air conditioners used in office, homes, public halls, ships, motor vehicles, industrial installation etc. However, the same doesn't mention "Aircraft" or air conditioning unit designed and manufactured specifically for aircraft as ground support equipment. Accordingly, the AACU are not classifiable under CTH 8415. c) That department in their comments have not re-butted the submission of the applicant rega....
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....ncipally with the articles of those Chapters. A part or accessory which answers to a description in two or more of the headings of those Chapters is to be classified under that heading which corresponds to the principal use of that part or accessory". This "sole or principal use" helps in determining the customs classification of AACU in as much the same is an essential part of aircraft due to it's sole use in Aircrafts. g) Application of 'General Rules for Interpretation of Customs Tariff', (GRI for short) for AACU's Classification: The applicant humbly submits that the General Interpretative Rules (GRIs) are the mandatory legal framework for Tariff classification. That relevant part of Rule 3 is extracted below for ready reference: Rule 3 "3. When by application of Rule 2 (b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows : (c) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or subst....
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....d during PH on 01.09.2025) h) That the department while accepting the classification of ASU under CTH 88073010 has entered reasoning in para (g) of the comments; the applicant humbly submits that said reasonings are also applicable for AACU as well, as explained below- Department's Comments (Reasons) on Classification of ASU under CTH 88073010 Applicability of same reasons for classification of AACU under CTH 88073010 "As per the application submitted by the applicant, the Air Start Unit (ASU) is used in conditions whenever the Aircraft APU (Auxiliary Power Unit) is switched off while the Aircraft is on ground for long haul hours" Similarly, Aircraft Air Conditioning Unit is also used whenever the Aircraft APU (Auxiliary Power Unit) is switched off while the Aircraft is on ground for long haul hours. The parameters within which the unit operates is not suitable for any kind of other use as its air volume/temperature/pressure can otherwise damage/disturb any general machine or equipment as the material used for aircraft engines is made up of a very special composition of material suitable to withstand the parameters of the ASU output which is only suitabl....
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....iew of the above submissions and the submissions made in the application for Advance Ruling and submissions made during personal hearing on 01.09.2025, the Hon'ble authority may kindly be pleased to rule that Aircraft Air Start Unit and Aircraft Air Conditioning Unit both merit classification under Chapter sub-heading 88073010. 6. Findings, Discussion & Conclusion: 6.1 Having examined the CAAR-1 application, the comments received from the jurisdictional Customs Commissionerate, the record of personal hearing held on 01.09.2025, additional written response of the applicant dated 11.09.2025 and the applicable legal framework, I noticed that while sharing the comments in respect of the application, the port has flagged that the IEC 0508053536 appears "deactivated". In response, the applicant vide mail dated 07.10.2025 has intimated that their IEC is active and they are eligible for ruling. On being satisfied that the applicant's case is not barred by any provision of CAAR Regulations, I find the application to be valid in terms of the Customs Act, 1962 and the CAAR Regulations, 2021. I, therefore, allow the application and proceed to determine the classification of the p....
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....but contests the ACU, contending that it is specifically mentioned under CTH 8415 and rightly classifiable in heading 8415 as an "air-conditioning machine" and it is outside the scope of Chapter 88 merely because it services an aircraft. 6.8 I have examined the submissions from both sides in light of Tariff entry and chapter/section/explanatory notes and application of General Rules of Interpretation (GRI). It is settled principle of law that the classification of any good under Customs Tariff Act, 1975 is governed by the General Rules for the Interpretation of the Import Tariff. Further, Rule 1 of GRI stipulates that "classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes." I have examined the competing headings and the relevant section notes. I have observed that Heading 8807 covers "Parts of goods of heading 8801, 8802 or 8806," with sub-heading 8807.30 for "Other parts of aeroplanes, helicopters or unmanned aircraft." "8807: 8807 Parts of goods of heading 8801, 8802 or 8806 8807 10 00 Propellers and rotors and parts thereof 8807 20 00 Under-carriages and parts thereof 88....