EPS - ECU is not an Instrument but a Part of Power Steering System: CESTAT dismisses Appeal of Mitsubishi [Read Order]

The Delhi bench of the Customs Excise Service Tax Appellate Tribunal ( CESTAT ) held that EPS-ECU is essentially a part of an automobile specifically designed to be a part of power steering and not an instrument. The Tribunal classified the EPS-ECU and its sub-assembly under CTI 8708 94 00.

M/s Mitsubishi Electric Automotive, the appellant manufactures and supplies parts of automobiles and for this purpose it imported “electronic control units for electronic power steering” (EPS – ECU) and its parts through 127 bills of entry. The appellant classified the goods under Customs Tariff Item 8708 9400 as parts and accessories of motor vehicles in its self-assessment.

 The revenue contented that they are parts of motor vehicles and should be classified, as such. Since they are electrical/electronic parts they should be classified, as such and not as parts of motor vehicles

The two member bench of Justice Dilip Gupta (President) and P.V Subba Rao (Technical Member) observed that merely because it is in the form of a PCB and other electronic components does not change it from a part of an automobile into an instrument or an apparatus.

The Bench found that EPS-ECU is used in cars with power steering to dynamically determine- based on the speed and torque of the car- how much assistance should be provided to the driver in steering and accordingly regulate the voltage supplied to the motor from the 12-volt battery.

The Bench also clarified that EPS-ECU is only meant for use in automobiles and it has no other use. The Bench accepted the submission of appellant that it should be treated as an incomplete EPS-ECU and should be classified as complete EPS-ECU as per GIR 2(a).

It was observed that any importer can self-assess goods by filing the Bill of Entry, and until the Bill of Entry is filed, the departmental officer cannot assess or take any action on it with respect to assessment.

While questioning as to how the departmental officers could have insisted that the goods should be classified in a particular heading in the Bill of Entry even before it was filed, the Bench explained that if the proper officer does not agree with the self-assessment by the importer, he can re-assess the duty and provide a speaking order.

It was found that EPS-ECU is a microprocessor with certain other parts which receives information from the speed and torque sensors and processes it and issues instructions to regulate the assistance provided by the power steering to the driver, and therefore, EPS-ECU does not merit classification under CTI 9032 90 00.

The CESTAT therefore dismissed Assessee's appeal and concluded that EPS-ECU and its sub-assembly deserve to be classified and were correctly classified under CTI 8708 94 00.

To Read the full text of the Order CLICK HERE

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