TaxTMI 
TaxTMI 
2026 (4) TMI 538
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....imported goods declared as 'ROTARY GAS METER-FMR G025 (FLOW METER) and classified them under Customs Tariff Item [CTI] 9026 10 10 as flow meters and claimed the benefit of Notification No. 24 of 2005-Cus dated 1.3.2.005 and paid zero Basic Customs Duty. Receiving intelligence that the appellant had mis-declared the meters as flow meters and misclassified them and they were actually 'Gas Meters' falling under CTI 9028 10 00, the Bills of Entry filed by the appellant and other details were examined along with the invoices uploaded on e-Sanchit of the Indian Customs EDI System [ICES]. The matter was investigated further, statements were recorded and finally the SCN was issued the proposals in which were decided in the impugned order. Submissions of the appellant 3. Shri Bipin Garg, learned counsel for the appellant made the following submissions: (i) The appellant has been importing Gas Flow meters since 1988 and has been classifying them under CTI 9026 10 10 claiming the benefit of exemption Notification No. 24/2005-Cus dated 1.3.2005 (S. No. 31). (ii) The customs officers have been clearing the goods after examination. (iii) The statement of Shri Raj....
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....fit of Notification No. 24/2005-Cus dated 1.3.2005 (S. No. 31). (ii) As per the explanatory notes to the Harmonised System of Nomenclature [HSN] for heading 9028, gas meters are designed to measure the volume of fluid passing through a conduit. These notes clarify that household meters, which include those measuring gas consumption fall within this classification. (iii) Conversely, the HSN notes for heading 9026 explain that they are tasked with assessing the flow rate rather than cumulative volume of gas delivered over a period which is the domain of supply meters categorized under heading 9028. (iv) The goods in question, identified as gas meters, are meant to measure the gas volume in cubic meters and are explicitly listed in CTI 9028 20 00 as gas meters. The supplier's website also presents the product as a gas meter and not as a flow meter. The ability to measure flow rate is one of the many technical specifications of the meters. (v) A similar case regarding the classification of the water meters supplied to Delhi Jal Board has been decided by a bench of this Tribunal in Customs Appeals no 50851 of 2021 and 50852 of 2021 M/s. SPLM Infra Lim....
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.... distribution networks. When a consumer consumes gas, IGL, as the supplier, needs to know how much was consumed and accordingly bill him. These are similar to the water meters installed by the municipal corporations or Jal boards or electricity meters installed by the power distribution companies. All these have one primary purpose. To check how much was consumed during a period and bill accordingly. The photographs of the measurements taken on the meters supplied by the appellant were provided to the customs during investigation by the IGL which is pasted in page 14 of the SCN (page 118 of the appeal). A sample of the reading of the seized sample of the meter is pasted at page 15 of the SCN (page 119 of the appeal). Both show the reading as m3or in other words, cubic meters of gas which is the volume of gas which passed through the meter. Of course, in any meter of this type, some other specifications are also required such as at what pressures the meter can operate, etc. but that does not become the function of the meter but it is intended to confirm that it is suitable to operate at the relevant pressures and rates of flow. It is similar to the operating voltage range indicated ....
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....ot meant to check the pressure or rate of flow. IGL will not bill its customers based on the rate of flow but will bill based on how much has flown to and used by the customer during the month or quarter. 13. After examining the records including the brochure submitted by the appellant, we have no manner of doubt that the meters are meant to measure how much total gas has flown and hence has been transferred. Such meters are covered under CTI 9028 10 00 which is the correct classification of the meters in dispute. 14. It is undisputed that if the meters are classified under CTI 9028 10 00 the appellant will not be entitled to the benefit of the exemption notification. The demand of duty, therefore, needs to be confirmed. 15. Next is the question of extended period of limitation. The reasons for invoking extended period of limitation indicated in the SCN are below: "12. Whereas, the importer appear to have contravened the provisions of section 17 (1) of the Customs Act in as much as they did not assess their customs duty liability correctly in respect of the goods imported under the aforesaid Bills of Entry. 13. In view of the aforesaid, it appears that th....