TaxTMI 
TaxTMI 
TaxTMI 
2025 (12) TMI 1743
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....mpex and Shipping Services) is a proprietorship Firm holding a valid import-export code number 0311044841 issued by the Office of the Director General of Foreign Trade in terms of the provision of Section 7 of the Foreign Trade Development & Regulation Act, 1992. The applicant seeking an Advance Ruling under Section 28H of the Customs Act, 1962 is covered by the definition of 'applicant' as per Section 28E (c) of Customs Act, 1962. 2.2 The applicant submitted that the composition of the goods i.e. Timber Steel in terms of weight consists of i. Galvanized Steel - 75-80% ii. Laminated Veneered Lumbar - 20-25% iii. Plastic Cover - 2-3% 2.3 The applicant further submitted that Timber Steel is used exclusively for shuttering of concrete construction work also known as formwork. The Applicant submitted that Timber Steel is used exclusively for formwork and submitted a leaflet of domestic manufacturer All Marc Industries to substantiate their point. They further submitted that the formwork has been defined as "Total system of support of freshly placed concrete, including the mold or sheathing that contacts the concrete and all supporting members, h....
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....ngs 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 of them gives a more complete or precise description of the goods. (b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3 (a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable." 3.2 The applicant submitted that the essential character is determined by the nature of the material, its bulk, weight or value or by the role of a constituent material in relation to the use of the goods. They further submitted that the main ingredients in the composite goods are steel and timber. Traditionally only timber and later plywood or only steel was used for formwork. However, due to the absorption of moisture 100% timber would disfigure, warp or bend in 40-50 repeat uses, hence it was replaced by plywood....
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....400707 on 09.01.2025 as indicated by the applicant at Sr. No. 13 of their CAAR-1 Forms calling upon them to furnish the relevant records with comments, if any, in respect of the said application. Further reminders were also issued on 07.02.2025, 21.03.2025 and 09.04.2025, however, no reply was received from the concerned Commissionerate. 5. Records of Personal Hearing 5.1 A personal hearing was held on 09.01.2025 at 3:00 PM in the office of the CAAR, Mumbai. Shri Rajesh Gosalia - Proprietor and Shri Jignesh Chowatia - representative appeared for the hearing on behalf of the applicant and reiterated the contention of the applicant filed with the application. They further stated that the subject goods are Timber -- Steel made of galvanized steel - 75-80%. Laminated Veneered Lumber - 20-25% and Plastic Cover 2-3%. The subject goods 'are used as "Construction Formwork" exclusively for shuttering of concrete. They submitted that there may be some competent heading viz. 73084000, 84806000 and 73269090 but the said goods merit classification under CTI 84806000 as mould for mineral material and relied upon GRI 3(c) of Rules of Interpretation. It was specifically asked to provide ....
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....mwork). Relevant paras of the same are reproduced as under: Clause 4- Requirement of Falsework, Para 4.2 "Rigidity and Deflection" "Falsework shall be rigid enough so that the deflection under the dead load and live loads and forces caused by ramming and vibration of concrete and other incidental loads imposed on it during and after casting of concrete are will within permissible limits. The rigidity can be achieved by suitable number of ties and braces. Screw jacks or hardboard wedges, where required shall be provided to control the falsework settlement. Para 4.3- Strength and Stability The falsework shall be of adequate strength and so detailed as to withstand all anticipated loads including lateral loads, vibrations and small accidental loads. Clause 5 "Falsework may be fabricated at site, or partially or wholly prefabricated" The applicant submitted that their falsework gets assembled at site and is not prefabricated. The applicant further submitted that all of the above, show the importance of the Stimber-the exterior parts, in taking the loads while plywood- the inner part of the mould gives it the marble finish require....
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....and 2-3% Plastic Cover by weight which would be used exclusively for Shuttering of Concrete Construction work also known as Formwork. 7.5 Before deciding on the issue, let me deliberate on the legal framework prescribed in Customs Tariff Act, 1975, Chapter/Section notes along with HSN explanatory notes. Classification of goods in the Harmonized System of Nomenclature (HSN) is governed by the General Rules for the interpretations. Rule 1 of the General Rules for the Interpretation of the Import Tariff to the Customs Tariff Act, 1975 stipulate that for legal purposes, the classification of the import item shall be determined according to the terms of the headings and any relative Section or Chapter Notes. 7.6 In this case, there are 5 competing headings as put forward by the applicant itself i.e. 4418, 7308, 7326, 8480 and 8487 where this composite product i.e. Timber Steel can be classified. Before going into the nitty-gritty of the matter, let's have a look at the Heading Text of the above mentioned Six Headings. Sr. No. Tariff Heading Heading Text Relevant Sub-Heading Relevant Sub-Heading Text 1. 4418 Builders' joinery and carpentry of wood, i....
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.... that it is more sustainable compared to substitutes; have higher repetitions which results in lower cost per usage; is made of galvanized steel making it corrosion resistant and have greater strength; is designed for higher safety on work sites; is lightweight and easy to install by nailing to panels. 7.8.2 The brochure further mentions that J70 StiMBER is an accessory that creates a synergy between steel and timber to make a mould forcasting a wall, column and slab formwork. It is a galvanised steel tube with punched holes and timber inserted inside. This accessory acts as an asset to construction companies due to its high repetitions and ease of usage. The image of the product given in brochure is as under: 7.8.3 Further, I find that there are other manufacturers as well who are also manufacturing similar composite products for use in construction formwork. One such manufacturer is AllMare Industries which manufactures similar Composite product i.e. Steel Timber. AllMarc Industries on its website for Steel Timber Composite product (Formwork Beams | Building Formwork | Allmarc) mentions that the product is essentially a Steel Timber battens with a full-length steel cover, e....
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....roduct is primarily used in Temporary Formwork / Shuttering for concrete construction and is specifically designed for repeated use as a formwork system in construction projects. 7.9 Now, to find an answer whether the product under consideration merits classification as a mould or part of mould; or as a shuttering equipment; or as other article of steels, I find it essential to examine the terminology used in the application while describing the product such as Formwork, Falsework etc. and also terminologies such as Shuttering, Mould etc. used in the probable tariff heading listed above. 7.9.1 Shuttering * It is a part of formwork, or you may call it as derivative of formwork. Shuttering is a vertical temporary arrangement which is arranged to bring concrete in a desired shape. (Difference between Scaffolding. Formwork. Shuttering, Centering, Staging) * Shuttering is a temporary structure or moid used to hold freshly poured concrete in place while it cures. Think of it as the "container" that helps shape concrete until it solidifies. (What Is The Difference Between Shuttering And Formwork?) * Shuttering, also known as formwork, is a process of provi....
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....idges, and elevated roadways. (Falsework - Wikipedia) 7.9.4 Mould (Mold): * a hollow container with a particular shape into which soft or liquid substances are poured. so that when the substance becomes hard it takes the shape of the container (MQULD | English meaning - Cambridge Dictionary) * a container that you pour a liquid or soft substance into, which then becomes solid in the same shape as the container, for example when it is cooled or cooked (mould noun - Definition. pictures. pronunciation and usage_notes Oxford Advanced Learner's Dictionary at OxfordLearnersDictionaries.com) 7.9.5 Further, I find that the Bureau of Indian Standards have published a "Glossary of Terms relating to Cement Concrète" under Indian Standards IS : 6461 (Part V) 'Formwork for Concrete'. This standard i.c. IS : 6461 (Part V) covers definitions of terms relating to form work for concrete. This standard defines Shuttering, Formwork, Falsework and Mould as under: * Formwork (Shuttering) : Complete system of temporary structure built to contain fresh concrete so as to form it to the required shape and dimensions and to support it until it hardens suf....
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....sified by reference to 3 (a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable. (c) When goods cannot be classified by reference to 3 (a) or 3 (b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration. 7.11 I find that the goods under consideration are composite goods which have both Wood (Timber) and Steel and are used in creation of Formworks in Construction activities. I further find that the subject goods can not be classified in terms of Rule 3(a) as each heading only answers to only a part of the substance contained in these composite goods as these are made from both Wood and Steel. Therefore, I proceed to classify them according to Rule 3(b). of the General Rules for Interpretation. I find that in the goods under consideration i.e. Steel Timber, although the timber portion occupies more volume, the steel portion is heavier and provides the structural and load- bearing characteristics. Thereby, it can be said that the essential character to this composite. product is imparted by Steel, wh....
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....not merit classification under Heading 8480. 7.15 Further, as I have already discussed above, Mould is defined as a form for casting precast units whereas Formwork (shuttering) is used at the construction site itself. Since the subject goods would be used in Formwork (Shuttering) and not in mould, therefore, these goods can not be classified in the residuary heading 8487 "Machinery parts, not containing electrical connectors, insulators, coils, contacts or other electrical features, not specified or included elsewhere in this Chapter." : 7.16 Since the subject goods can not be classified under Heading 8480 and Heading 8487, now, I am left with remaining 2 competing headings i.e. 7308 and 7326. Let me discuss both of these competing heading: Relevant excerpts of Heading 7308 are as under: Tariff Item Description of Goods 7308 STRUCTURES (EXCLUDING PREFABRICATED BUILDINGS OF HEADING 9406) AND PARTS OF STRUCTURES (FOR EXAMPLE, BRIDGES AND BRIDGE-SECTIONS, LOCK GATES, TOWERS, LATTICE MASTS, ROOFS, ROOFING FRAME-WORKS, DOORS AND WINDOWS AND THEIR FRAMES AND THRESHOLDS FOR DOORS, SHUTTERS, BALUSTRADES, PILLARS AND COLUMNS), OF IRON OR STEEL; PLATES, RODS, ANGLES, SHAPES....
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....ork. The heading does not cover : (a) Assembled sheet piling (heading 73.01). (b) Coffering panels intended for pouring concrete, having the character of moulds (heading 84.80) (c) Constructions clearly identifiable as machinery parts (Section XVI). (d) Constructions of Section XVII such as railway and tramway track fixtures and fittings, and mechanical signalling equipment, of heading 86.08; chassis frames for railway rolling-stock. etc., or motor vehicles (Chapter 86 or 87), and the floating structures of Chapter 89. (e) Movable shelved furniture (heading 94.03). 7.18 Further, I find that the applicant themselves has stated that the product is primarily used in Formworks for Construction Activities. Further, as discussed above, Formworks and Shuttering are most often used interchangeably to denote the same set of activity in construction, the only difference being, Shuttering is Vertical Formwork. Further, Indian Standards IS.6461 (Part V) defines both the terms to be same as well. I further find that HSN Explanatory Notes clearly includes scaffolding and similar equipment which are temporary in nature. just like the Formwo....