2022(11)LCX0209(AAR)

Milacron India Private Limited

decided on 03-11-2022

CUSTOMS AUTHORITY FOR ADVANCE RULINGS

NEW CUSTOM HOUSE, BALLARD ESTATE, MUMBAI - 400 001

E-MAIL: cus-advrulings.mum@gov.in

The 03^rd of November, 2022
Ruling No. CAAR/Mum/ARC/37/2022
In
Application No. CAAR/CUS/APPL/58/2022-O/o Commr-CAAR-MUMBAI

Ruling

    M/s. Milacron India Private Limited (hereinafter referred to as ‘the applicant’, in short) filed an application for advance ruling before the Customs Authority for Advance Ruling, Mumbai (CAAR, in short). The said application was received in the registry/secretariat of the CAAR, Mumbai on 5-8-2022 along with its enclosures filed by the above-mentioned applicant in terms of Section 28H(1) of the Customs Act, 1962 (hereinafter referred to as the ‘Act’). The applicant is holding IEC No. 895005441 and stated to be a global leader in the manufacture of highly engineered and customized plastic processing machineries and are one of the multinational companies with a wide range of product portfolio. The applicant is seeking advance ruling on the classification of semi-finished and finished casting parts (hereinafter referred to as the “subject goods”) which they propose to import for manufacturing of injection molding machine.

2. The applicant indicated that they propose to import Rough/Semi-finished casting parts (hereinafter referred to as the ‘subject goods’) for manufacturing of injection molding machine and seeking departments view for correct classification. The applicant has declared that they would be importing the subject goods through the port of Nhava-Sheva. Accordingly, comments from the jurisdictional Principal Commissioner/Commissioner of Customs, NS-V Zone II Mumbai, were invited in respect of the application for advance ruling in respect of the subject goods.

3. The applicant has submitted that they import spheroidal graphite iron castings of complex shapes that would be otherwise difficult or uneconomical to make by other methods. The size, shape, and function of the casting parts vary based on model & size of the injection molding machines. The casting parts are produced specifically in accordance with the design of the injection moulding machine as per Milacron drawings and patterns. These castings cannot be used for any other purpose and these are parts of the injection moulding machine suitable for use solely with a particular kind of machine manufactured by them. After importing, the surface and holes of casting parts are cleaned, finished & tapped before they are used in the injection moulding machine. Every casting part has its own specific function/role in the injection molding manufacturing process. In this respect the applicant also submitted images of the rough/semi-finished casting parts and images of the injection molding machine where the casting parts would be used.

3.1 The applicant has contended that the explanatory note of Heading 7325 does not cover castings which are products falling in other headings of the Nomenclature (e.g., recognizable parts of machinery or mechanical appliances) or unfinished castings which require further working but have the essential character of such finished product. In view of the above grounds, the applicant has opined that the rough and semi-finished casting imported by them should be classified under CTH 8477 90 00.

4. Personal hearing in the matter was held on dated 22-9-2022 wherein Mr. Rajesh Soni, (DGM-EXIM) along with Mr. Rajendra Sharma-Technical officer, represented the applicant. However, no one was present for the jurisdictional authority. Above stated representatives presented their case covered under CAAR-1 application. They presented D.O.R. (MOF) Notification No. 42/2017-Customs (ADD), dated 30-8-2017 in which castings are classified under CTH 8483. They also invited attention to the HSN explanatory notes by virtue of which their proposed imports will not get covered under Chapter 73. Further they explained the scope of CTH 8477 90 00 in support of their classification claim.

5. I have gone through the application, the submission of applicant along with records of personal hearing and other relevant information. I have perused the contents of Notification No. 42/2017-Cus. (ADD), dated 30-8-2017. After comparing the description of the subject products including CTH, in CAAR-1 application vis-à-vis sub-heading or tariff item and description of goods in columns 2 & 3 respectively of the Notification No. 42/2017-Cus. (ADD), I observe that the proposed imports are not covered under any of the serial numbers of this notification. I have gone through the design/drawings of castings of injection moulding machine parts submitted by the applicant along with CAAR-1 and compared descriptions of proposed imports of these parts/castings vis-à-vis product description of Notification No. 42/2017-Cus. (ADD), dated 30-8-2017 which specifically states casting for wind operated electricity generators falling under Tariff Item 8483 40 00, 8503 00 10 or 8503 00 90. Castings of injection moulding machines and castings of wind operated electricity generators have completely independent and separate tariff headings in the Schedule-I to the Customs Tariff Act, 1975 and hence unless the product description of the imported products matches with the description of goods along with related sub-heading/tariff entry in the Notification No. 42/2017-Cus. (ADD), dated 30-8-2017, this notification has no bearing on deciding present classification matter. In view of the above and different tariff entries being mentioned for the classification of subject goods, it is necessary to examine the alternate classifications for the subject goods.

5.1 Chapter 73 covers articles of iron or steel and the notes to chapter provide as follows :

1. In this Chapter the expression “cast iron” applies to products obtained by casting in which iron predominates by weight over each of the other elements and which do not comply with the chemical composition of steel as defined in Note 1(d) to Chapter 72.

Heading 73.25 covers other cast articles of iron or steel.

As per the explanatory notes to Heading 73.25 this heading covers all cast articles of iron or steel, not elsewhere specified or included. The heading includes, inspection traps, gratings, drain covers and similar castings for sewage, water, etc. systems; hydrant pillars and covers; drinking fountains; pillar-boxes, tire alarm pillars, bollards, etc.; gutters and gutter spouts; mine tubbing; bails for use in grinding and crushing mills; metallurgical pots and crucibles not fitted with mechanical or thermal equipment; counterweights; imitation flowers, foliage, etc. (except articles of Heading 83.06); mercury bottles.

It is also provided that “this heading does not cover castings which are products falling in other headings of the Nomenclature (e.g., recognizable parts of machinery or mechanical appliances) or unfinished castings which require further working but have the essential character of such finished products”. The heading also excludes :

(a) Articles of a kind described above obtained by processes other than casting (e.g., sintering) (Heading 73.26).

(b) Statues, vases, urns and crosses of the type used for decoration (Heading 83.06).

Products under consideration, as per applicant, would be subjected to further working after importation but they have attained the essential character of finished product due to uniqueness of their use in their machines. Hence, in view of the above explanatory note, the subject goods do not seem classifiable under Heading 7325.

5.2 Alternate classification under CTH 8477 of Chapter 84 covers Machinery for working rubber or plastics or for the manufacture of products from these materials, not specified or included elsewhere in this chapter. The applicant intends to import subject goods for manufacturing of injection molding machine, and specific entry is available in the tariff under CTH 8477 10 00 for injection molding machine. The relevant entries available under this heading is as under :

    As can be seen from the relevant tariff heading, the parts of the machinery of this heading are also covered in this heading, subject to the general provisions regarding the classification of parts (see the General Explanatory Note to Section XVI). As per the submission of the applicant, the subject goods are rough/semi-finished casting parts for manufacturing of injection molding machine. Also, as per the drawings the subject goods are shown as parts of the machinery. Injection moulding machine and its parts are specifically covered under this heading as Tariff Items 8477 10 00 and 8477 90 00 respectively. In view of the aforementioned provision regarding classification of parts, the subject goods also come under the purview of the Tariff Item 8477 90 00.

6. In the absence of any comment from the jurisdictional Principal Commissioner/Commissioner of Customs, on the impugned subject matter, I proceed to render an advance ruling. As per the explanatory notes to Heading 73.25 which provides for exclusion of “castings which are products falling in other headings of the Nomenclature (e.g., recognizable parts of machinery or mechanical appliances) or unfinished castings which require further working but have attained the essential character of such finished products, the subject goods do not merit classification under Heading 7325. Further, as discussed in Para 5.2 supra the subject goods merit classification under Heading 8477 as parts of the machinery of the said heading. In view of above discussion, I rule that the subject goods, e.g., rough/semi-finished castings merit classification under Heading 8477; more specifically under Tariff Item 8477 90 00 of the Schedule I to the Customs Tariff Act, 1975.

(Narendra V. Kulkarni)         
Customs Authority for Advance Rulings,
Mumbai                    

F.No. CAAR/CUS/APPL/58/2022-0/o Commr-CAAR-Mumbai                     Dated: 03.11.2022

This copy is certified to be a true copy of the ruling and is sent to: -

1. M/s. Milacron India Pvt. Ltd., 93/2 & 94/1, Phase-1, G.I.D.0 Vatva, Ahmedabad, Gujarat — 382 445
Email: rajesh_p soni@milacron.in

2. The Commissioner of Customs (Nhava Sheva -V), Jawaharlal Nehru Customs House, Nhava Sheva, Tal Uran, District Raigad, Maharashtra — 400707 Email: comr-ns5@gov.in

3. The Customs Authority for Advance Rulings, 5^th Floor, NDMC Building, Yashwant Place, Satya Marg, Chanakyapuri, New Delhi-110021. Email: cus-advrulings.del@gov.in

4. The Principal Chief Commissioner of Customs, Mumbai Customs Zone-I, Ballard Estate, Mumbai -400001. Email: ccu-cusmuml1@nic.in

5. The Chief Commissioner(AR), Customs Excise & Service Tax Appellate Tribunal (CESTAT), West Block-2, Wing-2, R.K. Puram, New Delhi - 110066.
Email: cdrcestat123@gmail.com,ccar.cestat-delhi@gov.in

6. The Commissioner (Legal), CBIC Offices, LegalJCX.8A, Cell, 5^th floor, Hudco Vishala Building, C-Wing, Bhikaji Cama Place, R. K. Puram, New Delhi — 110066.
Email: anishgupta.irs@gov.in,commr.legal-cbec@nic.in

7. The Member (Customs), Central Board of Indirect Taxes, North Block, New Delhi-110001
Email: mem.cus-cbec@nic.in

8. The Webmaster, Central Boards of Indirect Taxes & Customs.
Email: webmaster.cbec@icegate.gov.in

9. Guard file.

(P. Vinitha Sekhar)           
Secretary/Additional Commissioner,    
Customs Authority for Advance Rulings,
Mumbai