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TMI Blog2019 (2) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... bedded in it for drawing required rated current depends on the load. The accumulators are covered under heading 8507 whether or not they include any ancillary components which contribute to their function of storing and supplying electric energy. Further the. accumulators are classified under the heading 85.07 even if they are designed for use with a specific device. Therefore, even though the battery in the said “Power Bank” is attached to the ancillary circuitry of “Voltage Booster System”, for effective function of the said battery, the principal function of the said Power Bank remains the same i.e storing and supplying of electric energy and ‘hence the said product merits classification of the heading 85 07. as an accumulator. - AAR KAR ADRG 01/2019 - - - Dated:- 22-1-2019 - SRI. HARISH DHARNIA, AND DR. RAVI PRASAD M.P. MEMBER Represented by: Sri Shivarejan K, Charted Accountant ORDER UNDER SUB-SECTION (4) OF SECTION 98 OF CENTRAL GOODS AND SERVICE TAX ACT, 2017 AND UNDER SUB-SECTION (4) OF SECTION 98 OF KARNATAKA GOODS AND SERVICES Tax ACT, 2017 1. M/s. Xiaomi Technology India Private Limited, Orchid - Block E, Embassy Tech Village/ Devarabisanahahalli, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the other components. It is of aluminum/ polycarbonate and is flame retardant. 4. The Applicant further submits that the Mi Power Bank performs the function of charging i.e it provides regulated output to compatible devices such as mobile phones tablets, Bluetooth speakers etc., It performs mainly two activities while charging the said compatible devices namely (i) Accumulation of electrical enter and (ii) converts energy from DC-to-DC to provides regulated output based on the load demand. 5. In view of the above, the applicant sought advance ruling in respect of the following question: Whether the Power Bank , traded by the Applicant, is classifiable under Heading 8504 40 90 as Static Converter -Others ? PERSONAL HEARING: / PROCEEDINGS HELD ON 29.05.2018 28.06.2018. 6. The Applicant authorized Sri Shivarajan K, Charted Accountant and the said authorized representative appeared for personal hearing proceedings on 29.05.2018, before this authority and submitted that they have been classifying their product Power Bank right from the pre-GST regime under the entry 8504 40 90 as Static Coverters - Others with respect to imports as well as domestic pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut forth another argument, submitting that the Power Bank essentially performs dual function i.e. accumulation of energy conversion of energy from DC to DC providing regulated output current; the principal function of the Power Bank is to ensure the charging of device; mere lithium-ion battery would not suffice to charge a device unless the battery is supported by a converter. Therefore the Power Bank has to be classified as per the converter contained therein, which performs the principal function of charging, in terms of Section Note 3 to the Section XVI of the Customs Tariff Act 1975. 7.3 The applicant wishes to draw the attention towards the rule 3(b) of General Rules of Interpretation of Customs Tariff and contends that the Power Bank shall be classified on the basis of the component contained therein i.e. converter, which gives its essential character and principal function and also enables the purchaser to charge devices of multiple voltage/ current ratings. They further submit that function of the Power Bank is akin / similar to Uninterrupted Power Supply System (UPSS) which is classifiable under 8504 as static converter, explaining the construction / circuitry worki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he battery in Power Bank and to adjust the current accordingly and (ii) Voltage Booster System, which is used to detect the device Connected to the Power Bank and to obtain output as per the load demand. Both the circuits are essentially enhancing the function of the main part i.e. Battery. Therefore the principal function of the said product is to store the electricity and supply the same i.e to charge the devices, connected to it. 8.3 Therefore it is clear from above that the principal function of the instant product is to store the electricity in the battery of the said product and to supply the same when required. Hence it is pertinent to mention here that the battery in the Power Bank is the main / core part of the device and without the battery the Power Bank would not function in the required manner. The charge management system is an ancillary circuitry for Charging the battery and the voltage boost converter is also an ancillary circuitry to draw the current from the battery at the relevant rating, depends on the load of the device connected. The Power Bank can also be used in the absence of the said voltage booster system, in which Case only the prescribed / pre-determ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the light of this discussion we feel that the ratio of the case law cited supra is not applicable to this issue. 8.6 Further the explanatory notes to the Harmonised Commodity Description and Coding System to heading 85.07 states the following: Electric accumulators remain classified here even if presented without their electrolyte. Accumulators containing one or more cells and the circuitry to interconnect the cells amongst themselves, often referred to as battery packs , are covered by this headings whether or not. they include any ancillary components which contribute to the accumulator s function of storing and supplying energy, or protect it from damage, such as electrical connectors, temperature control devices, and protective housings. They are classified in this heading even if they are designed for use with a specific device. It is clearly evident from the above explanatory note that accumulators are covered under heading 8507 whether or not they include any ancillary components which contribute to their function of storing and supplying electric energy. Further the. accumulators are classified under the heading 85.07 even if they are designed for use ..... X X X X Extracts X X X X X X X X Extracts X X X X
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