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Tuesday, February 26, 2013

mould for rubber is classifiable under sub -heading 84807100

CUSTOMS CLASSIFICATION OF BLADDER MOULD FOR RUBBER TYRE

 Goods are tire mold and is the one imparting the final shape to the tire. This is being used in the tire curing press. Mold parts are fixed in the press in the relative positions along with bladder assembly. Press is closed after placing the green tire, in its location. Once the press is fully closed, high pressure steam is given inside the bladder assembly. This steam pressure, compresses the green tire against the surface of the mold. Once curing cycle is completed, press opens and facilitates tire to come out.

Whole process is achieved by the compressive force exerted by steam and thus process is termed as compression molding. Hence, mold is categorized as compression mold.

Before proceedings for classification of  compression mold under import tariff , it would be relevant to refer to the relevant law for  classification of goods  under  “THE  GENERAL  RULES  FOR THE  INTERPRETATION (GIR) OF IMPORT TARIFF”, and ,”CLASSIFICATION  OF GOODS (Chapter 4 , Customs Manual 2012).”

 I. THE  GENERAL  RULES  FOR THE  INTERPRETATION  OF IMPORT TARIFF-
“ Classification of goods in this Schedule shall be governed by the following principles:
1. The titles of Sections, Chapters and sub-chapters are provided for  ease of reference only; for legal  purposes,  classification shall  be determined according to the terms of  the headings  and any relative Section or Chapter Notes and, provided such headings or  Notes  do not otherwise require, according to  the  following provisions:…………………………………
………………………………………………………………………………………………………………………
6. For legal purposes, the classification of goods in  the  sub-headings of a heading shall be determined according to the  terms of  those  sub headings  and any related  sub headings  Notes and, mutatis  mutandis, to the above rules, on the understanding  that only  sub  headings  at the same level are  comparable.  For  the purposes of this rule the relative Section and Chapter Notes also apply, unless the context otherwise requires.
Classification of Goods ( Chapter 4 of  Customs  Manual  2012)

    Relevant portion of this Chapter is reproduced for easy reference is as:

“2. Methodology of classification:
2.1 In the Tariff Schedule, commodities/products are arranged in a fixed pattern with the duty rates specified against each of them. The pattern of arrangement of goods in the Tariff is in increasing degree of manufacture of commodities/products in the sequence of natural products, raw materials; semi-finished goods and fully finished goods / article/ machinery, etc. The Indian Customs Tariff has 21 Sections and 98 Chapters. A Section is a group consisting of a number of Chapters which codify a particular class of goods.
The Section notes explain the scope of chapters / headings, etc. The Chapters consist of chapter notes, brief description of commodities arranged at four digit, six digit and eight digit levels. Every four-digit code is called a ‘heading’ and every six digit code is called a ‘subheading’ and 8-digit code is called a ‘Tariff Item’.


2.2 The Harmonized System (HS) provides commodity/product codes and description up to 4-digit (Heading) and 6-digit (Sub-heading) levels only and member countries of WCO are allowed to extend the codes up to any level subject to the condition that nothing changes at the 4-digit or 6-digit levels. India has developed 8-digit level classification to indicate specific statistical codes for indigenous products and also to monitor the trade volumes…………


2.5 The process of arriving at a particular heading/subheading code, either at four digit, six digit or eight digit level for a commodity in the Tariff Schedule is called ‘classification’.
The titles of Sections, Chapters and Sub-chapters are provided for ease of reference only. For legal purposes the texts of the Section Notes, Chapter Notes, Subheading Notes, Supplementary Notes, Headings, Subheadings, and the General Rules for Interpretation of Import Tariff (GIR) should be relied upon to determine the classification of an item.


2.6 The GIR is a set of 6 rules for classification of goods in the Tariff Schedule. These rules have to be applied sequentially. Rule 1 gives precedence to the Section notes/Chapter notes while classifying a product. Rule 2(a) applies to goods imported in incomplete / finished condition and assembled / unassembled condition. Rule 2(b) is applicable to ‘mixtures’ and ‘composite goods’. Goods which cannot be classified by application of Rule 2(b), will be classified by application of Rule 3 i.e. by application of ‘most specific description’ as per Rule 3 (a) or by ascertaining the ‘essential character’ of the article as per Rule 3 (b) or by taking into consideration the heading that occurs last in the numerical order as per Rule 3 (c). Rule 4 states that goods which cannot be classified by application of the preceding rules may be classified under the heading appropriate to the goods to which they are most akin. Rule 5 applies to packing materials / articles in which the goods are carried. Rule 6 is applied to arrive at the appropriate subheading within a heading and for that purpose the provisions of Rules 1 to 5 apply mutatis mutandis on the understanding that subheadings at the same level are comparable.

For the purpose of Rule 6 the relative Section and Chapter Notes also apply unless the context otherwise requires.”


II.THE GENERAL EXPLANATORY NOTES TO IMPORT TARIFF


1. Where in column (2) of this Schedule, the description  of  an article or group of articles under a heading is preceded by  “-”, the said article or group of articles shall be taken to be a sub-classification of the article or group of articles covered by the said  heading. Where, however, the description of an  article  or group of articles is preceded by “- -”, the said article or group of  articles  shall be taken to be a  sub-classification  of  the immediately  preceding  description of the article  or  group  of articles which has “-”. where the description of an article or group of articles is proceded by "---" or "----", the said article or group of articles shall be taken to be a sub classification of the immediately preceding description of the article or group of articles which has "-" or "--".
2. The  abbreviation  “%”  in any column  of  this  Schedule  in relation to the rate of duty indicates that duty on the goods  to which  the  entry relates shall be charged on the  basis of  the value  of the goods as defined in section 14 of the Customs  Act, 1962 (52 of 1962), the duty being equal to such percentage of the value as is indicated in that column.
3. In any entry, if no rate of duty is shown in column (5), the rate shown under column (4) shall be applicable.
ADDITIONAL NOTES
In this Schedule,—
(1) (a) “heading”, in respect of goods, means a description in list of tariff provisions accompanied by a four-digit number and includes all sub-headings of tariff items the first
four-digits of which correspond to that number;
(b) “sub-heading”, in respect of goods, means a description in the list of tariff
provisions accompanied by a six-digit number and includes all tariff items the first six-digits
of which correspond to that number;
(c) “tariff item” means a description of goods in the list of tariff provisions
accompanying eight-digit number and the rate of customs duty;

(2) the list of tariff provisions is divided into Sections, Chapters and Sub-Chapters;

(3) in column (3), the standard unit of quantity is specified for each tariff item to facilitate
the collection, comparison and analysis of trade statistics.


The relevant  Section, Chapter ,heading, sub-heading ,tariff items and HS explanatory notes for  determining classification of  compression mold for rubber tyre under Custosm Tariff  and  which are as under   :-    

                                                                                                                                                                                                                                
Note 2 to Chapter  84 of  Section VI

“2. Subject to the operation of Note 3 to Section XVI, and subject to Note 9 to this Chapter,a machine or appliance which answers to a description in one or more of the headings 8401 to
8424, or heading 8486 and at the same time to a description in one or other of the headings 8425 to 8480  is to be classified under the appropriate heading of the heading 8401 to 8424 or under the heading 8486, as the case may be, and not under the headings 8425 to 8480.”


  HSN explanatory Notes has given following heading and sub-headings classification of molds (as per page  XVI-8480-1, HSN ,edition,2007,is  reproduced below:


Mould  is defined in HSN (at page XVI-8480-1, HSN ,edition,2007) as under:-
 HSN Explanatory Notes to   Group (G) of heading 8480  as per page XVI-8480-1, HSN ,edition,2007 is  reproduced below :

It is observed that ,“Bladder” mould for vulcanizing tyre, uses compression force for the rubber to conform to the mold cavity. Hence, Bladder moulds for rubber are compression type .


Entries   at Chapter 84 of Customs Tariff ( 2012-2013)  with Basic Customs Duty(BCD):
Tariff Item
Description of goods
Unit                         Rate of duty
           _________________
                  Standard               Preferential Area   
    (1)
       (2)
   (3)
    (4)
             (5)

  8480             MOULDING BOXES FOR METAL
                       FOUNDRY; MOULD BASES;
                       MOULDING PATTERNS; MOULDS
                       FOR METAL (OTHER THAN
                       INGOT MOULDS),  METAL CARBIDES,
                       GLASS,  MINERAL MATERIALS,
                       RUBBER OR PLASTICS

                      -      Moulds for rubber or plastics :

8480 71 00   --       Injection or compression types                 kg.            7.5%                          -

8480 79 00   --        Other                                                              kg.             7.5%                         -




 Thus , it is seen above , that the at tariff Heading 8480, `Moulds for rubber or plastics ` is preceded by “ –“. And ‘Injection or compression types ` and ` Other’ are preceded “- - “.Thus as per THE GENERAL EXPLANATORY NOTES TO IMPORT TARIFF, the Moulds for rubber or plastics has two  sub-classes  of  ‘Injection or compression types ` and ` Other’. Under ‘Injection or compression types ` , and `other ` there is only  one tariff item 84807100 and 84807900 ,respectively. Hence, classification of mould for rubber is decided based on molding process used,e.g.injection,compression ,or,other.



The goods are compression type mold and used for rubber tyre making. Mold parts are fixed in the press in the relative positions along with bladder assembly.  Press is closed after placing the green tire, in its location. Once the press is fully closed, high pressure steam is given inside the bladder assembly. This steam pressure, compresses the green tire against the surface of the mold. Once curing cycle is completed, press opens and facilitates tire to come out.
                                                                          The whole process is achieved by the compressive force exerted by steam and thus process is termed as compression molding. Hence, mold is categorized as compression mold.

To build hollow parts of a tyre ,it is often necessary to build an inflatable bladder which temporarily occupies the void within the tyre. Thus, Bladder molding is a form of compression molding in that pressure forces the rubber to conform to the mold cavity.

The goods are specifically covered sub-heading 848071 as “Bladder moulds” for vulcanizing tyres as per HSN Explanatory Notes to   Group (G)(1) of heading 8480  , page XVI-8480-1, HSN ,edition,2007 . Also, it falls under single tariff entry 84807100 of sub-heading 848071.
 Compression mold for rubber tyre is not excluded from heading 8480 by virtue of Note 2 to Chapter 84 of Section VI and also as per exclusion of  heading 8480  given into  HSN Explanatory Notes

  Under the authority of GIR 1, imported goods are provided for specific tariff item  84807100. Therefore, on application of General Rules for the Interpretation (GIR) of the First Schedule to Customs Tariff, GIR-1 read with Note  2  to Chapter 84  ,  “mould for rubber ” falls  under Chapter heading 8480 . Also,  by application of ‘most specific description’ ,compression mold for rubber tyre ,are falling under sub-heading 848071.Hence, as per GIR-6 read with   HSN Explanatory Note to tariff heading 8480, ‘mould for rubber’ is classifiable under sub -heading 84807100.

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