TaxTMI 
TaxTMI 
2025 (12) TMI 1749
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....27. The revenue alleged that the product was rightly classifiable under CTH 3822 0019 and accordingly notice was issued for reclassifying the products and confiscating the goods under Section 111(m) of the Customs Act, 1962. The Commissioner after detailed analysis held that the product was rightly classifiable under CTH 38220019 and confirmed the differential duty of Rs.5,06,61,014, also held that the goods were liable for confiscation and imposed redemption fine of Rs.2,30,00,000 under section 125(1) of the Customs Act, 1962 and imposed penalty equal to the duty amount under Section 114A of the Customs Act, 1962. Aggrieved by this order the appellant is in appeal before us. 3. The learned counsel on behalf of the appellant submitted that the appellant imported blood gas cartridges and classified the same under 90279090 availing the benefit of Notification 25/2005-Customs (Sl.No.32), however, the revenue after two years issued the show-cause notice reclassifying the products under 3822. It is further submitted that since the goods were already assessed issuing the demand notice beyond the normal, without challenging the assessment was not in order. It is also submitted that the....
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....he reliance placed by the counsel on the decision of the Hyderabad Tribunal is not relevant in view of the fact that the classification of the product in question is different from that decided by the Tribunal at Hyderabad relied upon by the appellant. 5. Heard both sides. The period of dispute is from 04.04.2018 to 29.07.2019 and the show cause notice was issued on 01.04.2023, alleging mis-classification of cartridges used in the I-STAT analyser immuno under Chapter Heading 9027 instead of 3822 as claimed by the revenue. The issue before us is whether the cartridges imported by the appellant are classifiable under CTH 3822 0019 or under CTH 9027 8090. 5.1. The appellant has heavily relied on the decision of the Regional Bench Tribunal Hyderabad Final Order No. A/30019/2023 dated 10.03.2023 in the appellant's own case. The Observations of the Tribunal are reproduced below: "The issue involved in this appeal is with regard to the classification of imported goods namely i) I Stat Blood Gas Investigation Cartridges, ii) I Stat Wireless Analysers with printer kit and iii) I Stat Alinity Instruments with accessories.-- whether the said goods are classifiable under Customs....
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.... we hold that instrument - I Stat System along with cartridges, etc are prima facie used for anylysis of various parameters of blood, and is primafacie a blood analyser. Both in case of glucometer or in the case of the present I Stat System with cartridge, blood is drawn and a few drops of blood are put on the cartridges or test strip and thereafter, on being attached to the I Stat System/Analyser, gives the readings. The only difference is that the item under consideration is more sophisticated than the glucose meter. The testing of blood by analyzing and indicating the various parameters is undisputedly an outcome of chemical analysis, etc. In the facts and circumstances, we find that the heading 9027, which covers instruments for chemical analysis is more specific than CTH 9018, which covers instruments used in medical/surgical science, etc. Further, we find that Rule 3 of General Rules of Interpretation provides that a specific description is to be preferred over a general description. We further find that the Court Below have erred in deciding the classification relying on the facts that the goods in question are mostly used on bedside or in an ICU. Accordingly, following the ....
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....ges also get classified under CTH 9027 along with the ISTAT Analyser. 5.3 In the present case before us the dispute is with regard to very same cartridges imported by the same appellant and the claim of the revenue is that the cartridges are to be classified under CTH 3822. We examine this we need to understand the impugned product based on its technical literature placed on record. As per the technical literature placed on record the I STAT analyser is a handheld analyzer that delivers lab-quality diagnostic results in minutes. It is lightweight, portable and easy to use, and it operates with the advanced technology of ISTAT test cartridges. Together, they create the I-STAT System - a point-of-care-testing platform that provides healthcare professionals with diagnostic information as and when needed. The pictures of the same is reproduced below: 5.4. Further the cartridge of I STAT Analyser is a single use product and contains microfabricated thin film electrodes or sensors assembled in each of these cartridges. The cartridge provides chemistries that are important in the diagnosis and treatment of patients with hypertension, dehydration, cardiac distress etc; The Commission....
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....f the test subject may be determined on the basis of the reaction pattern of different HLA test sera. Besides the active ingredients the reagents contain additives for stabilisation and conservation". Thus, the Chapter Heading 3822 includes diagnostic reagents such as pregnancy kits, AIDs diagnosing Kits etc which react based on the chemical reaction and the results are displayed. However, based on the technical literature of the impugned product though the cartridge is to test various parameters based on the blood samples placed on it, the results of it are known only when it is placed on to the I STAT analyser. Therefore, since they do not provide any results based on chemical reactions as happens in the case of pregnancy kits they cannot be held as a diagnostic agent to be classified under CTH3822. The cartridges are nothing but an accessory as is held by the revenue in the earlier proceedings at Hyderabad as it has to necessarily function as part of the I STAT analyser and the Commissioner in the impugned has rightly observed that they both form the I STAT system. It is also to be noted that as per Section Notes 2(b) of Chapter 90 reads as follows: "(b) other parts ....
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....lucose meter can be expected to become more sophisticated and compact without change in its essential function. The essential function of a Glucose meter is to draw the blood as well as test the blood for Glucose level. The product in question is also able to draw the blood as well as test the blood. The testing of blood and then its analysis for indicating blood sugar content as revealed by the Glucometer is undisputedly the outcome of a chemical analysis. That is, the Glucometer is an instrument for chemical analysis. Having noted the essential characteristic of both a Glucose meter system with strips and lancets and the Glucose meter without strips, it would be illogical to say that the Glucose meter with strips will be classifiable under heading 90.18 whereas the Glucose meter without strips will get classified under heading 90.27. Therefore, we reject this argument of the Commissioner. 6. For a deeper examination of the issue, we may refer to the HSN Explanatory Notes and the Customs Tariff Act. The General Rules for the Interpretation of the Customs Tariff Act provide that (Rule 1) for legal purposes classification shall be determined according to the terms of the He....
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....le High court and accordingly hold that the impugned products are rightly classifiable under CTH 9027. 8. With regard to limitation on examining the sample copies of Bills-of -Entry placed on record, we find that the appellant has described the product as accessories of I-stat Blood Gas investigation and classified the same under CTH 9027-9090. The only ground to invoke suppression is that on investigation it was noticed that the commercial invoice received from APOC, US pertaining to I-stat cartridges described the classification under 3822. However, it is also a fact that the revenue had issued show-cause notice dated 05.04.2019 to the appellant at Hyderabad Commissionerate which was adjudicated by the Commissioner vide order dated 04.02.2020 classifying the imported products I-stat analyser and the cartridges under CTH 9018 denying the benefit of Notification No. 24/2005 & Notification No. 25/2005 Customs both dated 01.03.2005, which was appealed against and the products were reclassified under CTH 9027 by the Tribunal Hyderabad vide Final Order No. A/30019/2023 dated 10.03.2023. The Commissioner in the impugned order observes that the cartridges for I-stat analyser described....