2009 (2) TMI 159 - AT - Customs

Import of dredger in CKD condition classification - This report appearing in the order-in-original also listed the parts and accessories under import. The supplier had clarified that the goods involved were a suction type dredger which functioned from a floating structure such as pontoons. M/s. SGS India Limited also certified after inspecting the goods as pump for dredging sand, minerals etc. under water sans a floating structure. M/s. S.G.S. India Limited further clarified in response to queries from the department vide their letter dated 31-12-98 that the goods under import were a complete suction type dredger without pontoons and outlet pipes. Held that - pontoons are not essential for a dredger as per the tariff and that the impugned goods were a dredger in CKD condition without outlet pipes - The absence of certain amount of outlet pipes or pontoons does not affect the claim of the impugned goods to be classified as a dredger under CSH 8905.10

Summary

Issues: Classification of imported goods as a dredger under CSH 8905.10 based on the presence or absence of certain parts like pontoons and outlet pipes. Interpretation of HSN Note under Chapter 89 regarding the classification of separately presented parts and accessories of vessels or floating structures.

Classification of imported goods as a dredger under CSH 8905.10:
The case involved the classification of imported goods claimed to be a dredger under CSH 8905.10. The Assistant Commissioner of Customs initially classified the goods as a dredger under this category, following Rule 2(a) of the Interpretative Rules, as the consignment did not include pontoons and outlet pipes. However, the Commissioner (Appeals) vacated this classification, stating that the goods comprised separately presented parts and accessories of a dredger other than a floating structure. The examination report identified the imported goods as specific components like a hydraulic pump, excavator, and power pack pipes, concluding that the goods were not a complete dredger but parts and accessories. The Commissioner (Appeals) held that the imported goods did not have the essential character of a dredger to be classified as such under Rule 2(a) of the Interpretative Rules.

Interpretation of HSN Note under Chapter 89:
The Tribunal analyzed the HSN Note under Chapter 89, which excludes separately presented parts and accessories of vessels or floating structures from Chapter 89 classification, directing them to be classified elsewhere in the Nomenclature. The Commissioner (Appeals) misinterpreted this note to mean that a dredger imported in dismantled condition cannot be classified as a dredger and that the parts had to be classified outside Chapter 89. However, the Tribunal clarified that the note required parts and accessories of vessels or floating structures to be classified under appropriate tariff entries. Upon reviewing the examination report, certificate from SGS India Limited, and supplier clarification, the Tribunal concluded that the imported goods constituted a complete dredger in completely knocked down (CKD) condition, eligible for classification as a dredger under CSH 8905.10 despite the absence of outlet pipes or pontoons. The Tribunal found the impugned order unsustainable, setting it aside and allowing the appeal filed by the importer.

This detailed analysis of the judgment highlights the issues of classification of imported goods as a dredger under specific categories and the interpretation of relevant HSN notes for proper classification, providing a comprehensive understanding of the Tribunal's decision in this case.