Customs Excise and Service Tax Appellate Tribunal dismisses extended limitation claim, sets aside penalty and fine imposed on I-STAT Analyzer cartridges.
In a significant ruling, the Customs Excise and Service Tax Appellate Tribunal (CESTAT), West Zonal Bench, Mumbai, has ruled in favor of M/s. Sandor Medicaids Pvt. Ltd., reclassifying their imported cartridges used in the I-STAT Analyzer under Customs Tariff Heading (CTH) 9027. The tribunal dismissed the earlier classification under CTH 3822 and set aside penalties and fines imposed by the Commissioner of Customs (Imports).
The case revolved around the classification of imported cartridges for the I-STAT Analyzer, which Sandor Medicaids had classified under CTH 9027 as accessories. The Commissioner of Customs had previously reclassified these under CTH 3822, alleging they were diagnostic reagents, and imposed a penalty equal to the duty amount along with a redemption fine.
The tribunal, comprising Dr. Suvendu Kumar Pati, Member (Judicial), and Mrs. R. Bhagya Devi, Member (Technical), concluded that the cartridges are integral accessories to the I-STAT Analyzer and do not function independently as diagnostic reagents. Therefore, they are correctly classified under CTH 9027, which pertains to instruments and apparatus for physical or chemical analysis.
The tribunal also addressed the issue of extended limitation, which the Commissioner had invoked, citing suppression or misdeclaration by Sandor Medicaids. The tribunal found no evidence of such suppression, noting that the description in the Bills of Entry was clear and the classification dispute was merely interpretational. This led to the conclusion that the extended period of limitation was not applicable.
The tribunal's decision drew on previous rulings, including a precedent from the Regional Bench Tribunal Hyderabad, which had also ruled in favor of classifying the cartridges under CTH 9027. The tribunal underscored that the interpretation of the classification was a matter of legal interpretation without any intent of misclassification by the appellant.
This ruling not only provides relief to Sandor Medicaids but also establishes clarity on the classification of such medical devices, potentially impacting future cases involving similar products.
Bottom Line:
Classification of imported goods - Cartridges used in I-STAT Analyzer classified under Customs Tariff Heading 9027 as accessories, not under Heading 3822 which pertains to diagnostic reagents - Extended period of limitation not attracted due to absence of suppression or misdeclaration.
Statutory provision(s): Customs Act, 1962 Sections 111(m), 125(1), 114A, 28
