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TMI Blog2021 (3) TMI 1359X X X X Extracts X X X X X X X X Extracts X X X X ..... eadings and sub-headings is the primary determinant of classification. The terms of the tariff headings and the accompanying explanatory notes leave no doubt that vehicles that transport goods, but are off-road vehicles are covered under CTH 8704 10. In the event, there is no necessity to refer to the provisions of Motor Vehicle Act or to the product positioning in the advertisements of the supplier. It cannot be the case that extraneous criteria can take precedence over the terms of tariff headings and HSN explanatory notes - In fact, the HSN explanatory notes even elaborate that the goods under sub-heading 8704.10 can generally be distinguished from other vehicles for the transport of goods by the characteristics such as limited speed and area of operation, special earth-moving tyres, payload and that certain dumpers are specially designed for working in mines or tunnels. The goods under consideration in this application are meant for movement/transport goods, carrying relatively high payloads, albeit over short distances within the premises of small and medium sized mines. They are not meant for working the earth. The terms of Heading 8704 10 and the accompanying chapter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... marised the technical specifications and usage of the proposed imports through the example of model Sandvik TH 320 underground mining truck, some characteristics of which are reproduced below :- Narrow 20 metric ton - for use in small and medium sized hard rock mines, Off-road use only, mainly in mining sites - max speed 27.8 km./hr., Loading weight - 42,600 kg. The applicant proposes the classification of the subject product under sub-heading 8430 50 10 as mining machinery excluding coal mining. The applicant has also pointed out a competing classification under sub-heading 8704 10 10 which includes motor vehicles including dumpers designed for off highway use. 3. In their application, the applicant indicated the Principal Commissioner of Customs, Nhava Sheva-I as the office concerned with the application. However, considering the work allocation at the Jawaharlal Nehru Custom House, the application was forwarded to the Commissioner of Customs, Nhava Sheva-V (the Commissioner, in short). Comments have been received from the Commissioner in which, considering the product specifications, intended usage and the relevant chapter notes and HSN explanatory notes, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mport is only for moving mined ore/muck from the mine, it cannot be called as a vehicle for transportation of goods. During the hearing, video clips of the product in operation was shown to emphasize its limited speed, compact build, its ability to squeeze in to narrow confines of an underground mine, as well as the severely restricted visibility from the cabin of the truck making it totally unsuitable for road use. It was also stated that the underground mining truck is capable of being operated remotely. During the hearing, the applicant was asked about the source country from which they intend to import the underground mining trucks and what is the classification adopted by them before the customs authorities of other countries where such trucks are imported. The applicant informed that Sandvik TH 320 underground mining trucks are manufactured in Finland and fairly concede that they classify such underground mining trucks under Chapter 87 of the Customs Tariff. On the request of the applicant, another hearing was held, in virtual mode, on 8-3-2021, so that the applicant can effectively put across their arguments vis-a-vis the comments offered by the Commissioner. During this hea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional organizations and the private sector for many other purposes such as internal taxes, trade policies, monitoring of controlled goods, rules of origin, freight tariffs, transport statistics price monitoring, quota controls, compilation of national accounts, and economic research and analysis. The HSN is, thus, a universal economic language and code for goods, and an indispensable tool for international trade. The Harmonized System is governed by The International Convention on the Harmonized Commodity Description and Coding System . The official interpretation of the HS is given in the Explanatory Notes (5 volumes in English and French) published by the WCO. The importance of the HSN, in matters of classification, in the words of none other than the Hon ble Supreme Court of India, is as follows :- Commissioner of Cus. C. Ex., Goa v. Phil Corporation Ltd. - 2008 (223) E.L.T. 9 (S.C.) :- 29. In a number of cases, this court has clearly enunciated that the HSN is a safe guide for the purpose of deciding issues of classification made under chapter 20. Collector of Central Excise, Hyderabad v. Bakelite Hylam Ltd. - 1997 (91) E.L.T. 13 (S.C.) :- 17 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uced above pertain to classification under central excise and not customs, the substantive line of reasoning that emerges from the aforesaid pronouncements is that when the commodity classification system is aligned with the HSN, as both customs and central excise tariff are/were, in India, HSN can be a reliable guide in determination of classification when there exists a doubt or a scope of dispute among more than one tariff entries. 7. To take a definitive view on the classification of underground mining trucks proposed to be imported by the applicant, which is designed for use in underground mines, primarily for removal of blasted ore (mucking) and moving material from extraction area to another place (tramming), it is important to look at the rival tariff entries. For the sake of clarity, both the contending tariff entries are reproduced below :- 8430 OTHER MOVING, GRADING, LEVELLING, SCRAPING, EXCAVATING, TAMPING, COMPACTING, EXTRACTING OR BORING MACHINERY, FOR EARTH, MINERALS OR ORES; PILE-DRIVERS AND PILE-EXTRACTORS; SNOWPLOUGHS AND SNOW-BLOWERS 8430 50 Other machinery, self-propelled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01 covers dumpers designed for off-highway use. Further classification under subheadings is on the basis of payload capacity. 10. The HSN explanatory notes under CTH 8704 state that the heading covers, inter alia, - Dumpers - sturdily built vehicles with a tipping or bottom opening body, designed for the transport of excavated or other materials. These vehicles, which may have a rigid or articulated chassis, are generally fitted with off-the-road wheels and can work over soft ground. Both heavy and light dumpers are included in this group; the latter are sometimes characterised by a two-way seat, two seats facing in opposite directions or by two steering wheels, to enable the vehicles to be steered with the driver facing the body for unloading. Shuttle cars - vehicles used in mines to transport coal or ore from the hewing machinery to the conveyor belts. They are heavy, underslung vehicles, equipped with tyres and fitted with internal combustion piston engines or electric motors. Thus, the above heading clearly covers goods in the nature of motor vehicles used for transport of goods, including those used for off-road purposes. Vehicles used for transport of excavat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he heading also state that vehicles designed for off-highway use are covered CTH 8704 10. The relevant HSN explanatory notes also make the above position clear. The notes mention that the vehicles falling under CTH 8704 10 are generally fitted with off-the-road wheels and can work over soft ground ; are used in mines to transport coal or ore from the hewing machinery to the conveyor belts ; are heavy, underslung vehicles, equipped with tyres and fitted with internal combustion piston engines or electric motors. 13. Thus, the terms of the tariff headings and the accompanying explanatory notes leave no doubt that vehicles that transport goods, but are off-road vehicles are covered under CTH 8704 10. In the event, there is no necessity to refer to the provisions of Motor Vehicle Act or to the product positioning in the advertisements of the supplier. It cannot be the case that extraneous criteria can take precedence over the terms of tariff headings and HSN explanatory notes. Even though the applicant has strenuously attempted to distinguish between the terms Transport and Movement , for the purpose of the present proceedings, considering the explanatory notes, I do not thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon ble Tribunal in the case of Chief Engineer, Ground Water Department [Mumbai 2011 (5) TMI 605 = 2011 (272) E.L.T. 551 (Tri. - Mumbai)] and the Hon ble Orissa High Court in the case of Orissa Mining Corporation (MANU/OR/0024/1978) have no application in the facts of the present proceedings in view of the explicit mandate of the HSN explanatory notes that, vehicles used in mines to transport coal or ore from the hewing machinery to the conveyor belts, which are heavy, underslung, equipped with tyres and fitted with internal combustion piston engines or electric motors .. ; are classifiable under Heading 8704. 16. To sum up, the goods under consideration in this application are meant for movement/transport goods, carrying relatively high payloads, albeit over short distances within the premises of small and medium sized mines. They are not meant for working the earth. The terms of Heading 8704 10 and the accompanying chapter notes/HSN explanatory notes squarely cover the said goods. Therefore, I do not find any merit in the applicant s contention of the goods not being motor vehicles as the functional and design feature of the goods answer the requirements of CTH 8704 10, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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