2005 (8) TMI 139 - AAR - Customs

Classification of the goods - Electrical static converters - Held that - Heading 8504 deals with electrical transformers, static converters (for example, rectifiers) and inductors. Sub-heading 8504 40 is in regard to static converters. The tariff item in question is a residuary entry. The goods mentioned above do not fit in any of the tariff items under sub-heading 8504 40. The items in question are essentially power converter as can be inferred from the technical write up submitted by the applicant. As per the Heading 85.04 of the HSN Explanatory Note it has been clarified that the electrical static converters are used to convert electrical energy in order to adapt it for further use. They incorporate converting elements of different types. They may also incorporate various auxiliary devices e.g. transformers, inductor coils, resistors, command regulators, etc. Their operation is based on the principle that the converting elements act alternately as inductors and non-inductors. Having regard to the technical details furnished by the applicant and the various sub-headings of the Heading 8504 of the Tariff Act, the most appropriate classification of the goods in question would be under the sub-heading 8504 40 and in particular, under the Tariff Item 8504 40 90.

Summary

Issues: Classification of goods under Customs Act, 1962

In the case before the Authority for Advance Rulings, the issue at hand pertains to the classification of goods under the Customs Act, 1962. The applicant sought an advance ruling regarding the classification of Alcatel Power Supply Unit, Alcatel Power Feeding Equipment, and Alcatel Power Converter Assembly under Tariff Heading No. 8504 40 90 of the First Schedule to the Customs Tariff Act, 1975. The Commissioner agreed with the applicant's classification, leading to a joint submission for the Authority's consideration.

Analysis:

The Authority for Advance Rulings examined the tariff heading 8504, which deals with electrical transformers, static converters, and inductors. Sub-heading 8504 40 specifically pertains to static converters. However, the goods in question, namely the Alcatel Power Supply Unit, Alcatel Power Feeding Equipment, and Alcatel Power Converter Assembly, did not align with any specific tariff item under sub-heading 8504 40. Based on the technical information provided by the applicant, it was determined that the items were essentially power converters, as indicated in the technical write-up.

Referring to the HSN Explanatory Note under Heading 85.04, it was clarified that electrical static converters are utilized to convert electrical energy for further use, incorporating various converting elements and auxiliary devices. Considering the technical details presented and the sub-headings under Heading 8504 of the Tariff Act, the Authority concluded that the most appropriate classification for the goods in question would be under sub-heading 8504 40, specifically under Tariff Item 8504 40 90.

Consequently, the Authority ruled that the Alcatel Power Supply Unit, Alcatel Power Feeding Equipment, and Alcatel Power Converter Assembly are classifiable under Tariff Item No. 8504 40 90 of the Tariff Act. This ruling was pronounced in an open court on August 30, 2005, by the Chairman of the Authority for Advance Rulings.