TaxTMI 
TaxTMI 
2026 (2) TMI 544
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....formed that M/s. Modine Thermal Systems Private Limited (hereinafter referred to as "the Applicant", "the Company", "Modine", "we", "our", or "us"), having their office at K7, SIPCOT Industrial Park, Mambakkam Village, Sunguvarchatiram, Kancheepuram, Tamil Nadu-602106, holding IEC number 0407010254, are engaged in the development, manufacture, marketing and sale of thermal management products, components, and systems for use in various original equipment manufacturer appliances. 2.1 As part of its operations in India, the applicant imports Aluminium Layered Oil Coolers/ Plate type heat exchanger unit (hereinafter referred to as "the product", "the product under consideration", or "the product in question") which is a plate-type heat exchanger designed to cool engine oil by transferring thermal energy to a coolant circulating through parallel chambers. Constructed from lightweight aluminum plates, it provides efficient heat transfer while ensuring a compact design. This device maintains engine oil within optimal temperature ranges to prevent thermal degradation, ensure effective lubrication, and safeguard overall engine performance. 2.2 The Applicant further submitted this app....
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....of Thermal Degradation: Mitigate the risk of oil decomposition and chemical breakdown resulting from prolonged exposure to elevated temperatures. 3.2.4 Enhancement of Engine Efficiency: Support efficient engine performance by maintaining appropriate oil temperatures, thereby reducing mechanical wear and extending the service life of critical engine parts. 3.2.5 Structural Durability: The brazed aluminium construction provides high structural integrity, ensuring reliable operation under elevated thermal and mechanical stresses commonly encountered in engine environments. 3.3 Material Composition: - The Aluminium Layered Oil Coolers are manufactured using high-grade aluminium alloys carefully selected to ensure excellent thermal conductivity, mechanical strength, and corrosion resistance. The construction materials are optimized to provide durability under high temperature and pressure conditions while maintaining lightweight design. The key components of these coolers typically include: * Precision-formed aluminium plates with brazed joints for structural integrity * Corrosion-resistant coatings or surface treatments to enhance longevity * Sealing....
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....ries of the motor vehicles of Headings 87.01 to 87.05." 6. It is pertinent to note that the applicable rates of customs duty for the aforementioned competing tariff entries differ substantially, as detailed in the table below: Tariff entry 8419 50 92 8708 Heading Description Heat Exchange Unit; Plate Type Parts and accessories of the motor vehicles of headings 87.01 to 87.05 BCD 7.5% 15% 7. In light of the above, the Applicant seeks to obtain ruling with regard to the following question of law/facts and accordingly submits this application before the Hon'ble Authority for Advance ruling: "Whether the Aluminium Layered Oil Coolers imported by the Applicant, for use in automotive vehicles for cooling of engine oil, is appropriately classifiable under HS code 8419.50.92 as "Heat Exchange Units - Plate Type?". 8. The Applicant's detailed submissions and prayer in relation to the classification question are set out in the following paragraphs for the Authority's consideration. The Company reserves its right to add/modify/retract submissions as may be needed. 9. Applicant's interpretation of law and facts in respect of the a....
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....involving a change of temperature such as heating, cooking, roasting, distilling, rectifying, sterilizing, pasteurising, steaming, drying, evaporating, vaporising, condensing or cooling, other than machinery or plant of a kind used for domestic purposes; instantaneous or storage water heaters, non-electric. As per the Explanatory Notes to 8419 issued by the World Customs Organization (WCO), this heading covers machinery and plant designed to submit materials (solid, liquid or gaseous) to a heating or cooling process in order to cause a simple change of temperature, or to cause a transformation of the materials resulting principally from the temperature change (eg., heating, cooking, roasting, distilling, rectifying, sterilizing, pasteurising, steaming, drying, evaporating, vaporising, condensing or cooling processes). 10. For ease of reference, the relevant extract of heading 8419 of the Schedule 1 to the Customs Tariff Act, 1975 has been provided below: Tariff code Description of Goods Chapter 84 Nuclear reactors, boilers, machinery and mechanical appliances; parts of it 8419 Machinery, plant or laboratory equipment, whether or not electrically heated (excl....
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....e: Chapter 87 Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof The relevant heading for the subject product would be 8708 which specifically covers Parts and accessories of the motor vehicles of headings 87.01 to 87.05. 14. The Aluminium Layered Oil Cooler is identifiable as being intended for use in motor vehicles powered by internal combustion engines falling under Headings 87.01 to 87.05. 15. However, in accordance with the General Provisions of Section XVII of the Explanatory Notes, the classification of "parts and accessories" is governed by Note 2 and the interpretative guidance provided under Part (III) - Parts and Accessories, which lays down the fundamental principles for determining the classification of such goods. (III) PARTS AND ACCESSORIES- It should be noted that Chapter 89 makes no provision for parts (other than hulls) or accessories of ships, boats or floating structures. Such parts and accessories, even if identifiable as being for ships, etc., are therefore classified in other Chapters in their respective headings. The other Chapters of this Section each provide for the classification of ....
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....iven the nature and intended function of the product under consideration, it squarely falls within the scope of Heading 8419, as it is designed to transfer heat from hot fluid to cold fluid within a system. 19. Furthermore, in accordance with General Rule of Interpretation 3(a) of the Harmonized System, classification should be based on the heading that provides the most specific description which is in this case the subject product's description is more specifically covered under the sub-heading 8419.50.92 which states- "Heat Exchange Units - Plate type". 20. In view of the above, the product does not fulfil two of the three essential conditions provided in Explanatory Notes to Section XVII, for an article to be classified thereunder. Therefore, the product is ousted from the scope of Section XVII and hence, from Heading 8708 by extension. 21. Reliance is placed on U.S. Customs and Border Protection (CBP) Ruling No. HQ 961660, which addressed the classification of an engine oil cooler designed for use in automotive vehicles. The product in question prevented engine oil from overheating by allowing cold water to flow in the opposite direction to the engine oil within t....
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.... the subject-item does not satisfy the third condition specified in Section XVII of the Explanatory Notes in-relation to "Ill-Parts and Accessories". A plain reading of clause (C) thereof, which we have quoted above, excludes "textile carpets" (Chapter57). 26. The main argument of the appellant is that because the car mats are made specifically for cars and are used also in cars, they should be identified as parts and accessories. But if we go by that logic, textile carpets could not have been excluded from Parts and Accessories. We have referred to such exclusion in the preceding paragraph. It has also been urged on behalf of the revenue that these items are not commonly identified as carpets but are different products. The Tribunal on detailed analysis on various entries, Rules and Notes have found they fit the description of goods under Chapter Heading 5703.90.90. We accept this finding of the Tribunal. Once the subject goods are found to come within the ambit of that sub- heading, for the sole reason that they are exclusively made for cars and not for "home use" (in broad terms), those goods cannot be transplanted to the residual entry against the Heading 8708. As we f....
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....s, when assembled as 'gears', are required for 'transmission systems' that, for the purposes of classification, are 'engines' and, by the exclusion in Section XVII of First Schedule to Customs Tariff Act, 1975, is to be discarded from the exclusion in Section XVI of First Schedule to Customs Tariff Act, 1975" 25. In light of the above discussions, the product merits classification under HS code 8419.50.92 as "Heat Exchange Units - Plate type", irrespective of the fact that it is for use with automotive vehicles. A. Conclusion-In conclusion, the Applicant respectfully submitted that the product under consideration- Aluminium Layered Oil Cooler is most appropriately classifiable under CTH 8419.50.92, based on the following grounds: * The Aluminium Layered Oil Cooler is a type of plate type heat exchanger which is specifically covered under the sub-heading 8419.50.92. * In accordance with the General Rules for the Interpretation (GRI) 1 and 3(a), tariff classification must be determined by the terms of the headings, the more specific description provided in the nomenclature, and any relevant Section or Chapter Notes. Heading 8419 of the ....
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....e "Aluminum Liquid Oil Coolers", which are used in the automotive vehicle for cooling the engine oil. That the product is made lightweight aluminium plates, they provide efficient heat transfer while ensuring a compact design which helps as preventing thermal degradation, ensure effective lubrication and safeguard overall engine performance and is heat exchange unit. They submitted that the said goods merit classification under CTH 8419 and duly explained in HSN explanatory notes to the CTH 8419. They relied upon GRI-1 and submitted that the subject goods do not merit classification under CTH 8708. No body attended for PH from the department side. Discussion and Findings 30. I have carefully examined the application for advance ruling filed by the applicant, the detailed written submissions made in support thereof, the technical literature, drawings and photographs placed on record, and the submissions made by the authorised representatives during the personal hearing dated 03.12.2025. I have also considered the relevant provisions of the Customs Tariff Act, 1975, the General Rules for the Interpretation of the Harmonized System (GRI), the applicable Section Notes an....
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....the headings and any relevant Section or Chapter Notes. 34. I find that Sub-heading 8419.50 specifically covers "Heat exchange units", and Sub- heading 8419.50.92 further specifies "Plate type" heat exchange units. I note that the HSN Explanatory Notes to Heading 8419, under the category "Heating or Cooling Plant and Machinery", state as follows: "Heat exchange units in which a hot fluid (hot gas, steam or hot liquid) and a cold fluid are made to traverse parallel paths, usually in opposite directions, separated by thin metal walls, in such a manner that the one fluid is cooled and the other heated." I find that the construction, operating principle and functional characteristics of the Aluminium Layered Oil Cooler correspond exactly with the description contained in the Explanatory Notes. Accordingly, I find that the subject goods are specifically and unambiguously covered under Customs Tariff Sub-heading 8419.50.92. 35. I observe that Heading 8708 is a residual heading applicable to parts and accessories of motor vehicles, subject to the conditions and exclusions contained in Section XVII of the Customs Tariff Act. I note that Note 2(e) to Section XVII expres....