Baxter’s Extraneal Peritoneal Dialysis Solution Classifiable under CTH 9018: CESTAT [Read Order]

The Customs, Excise and Service Tax AppellateTribunal (CESTAT), Chennai Bench, allowed Baxter's appeal and held that the classification of extraneal peritoneal dialysis solution should be under CTH 9018.

The facts of the case are that the import of goods described as “Extraneal Peritoneal Dialysis Solution with 7.5% Icodestrin, Fnb4984t Dialysis Fluids C.A.P.D” were classified under CustomsTariff Heading (CTH) 9018 which pertains to instruments and appliances used in medical, surgical, dental, or veterinary sciences.

However, since the authorities reclassified the goods under CTH 3004 which covers medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, the appellant was denied the benefit of exemption.

This resulted in issuance of a Demand Notice under Section 28(1) of the Customs Act, 1962. The demand was confirmed and when appealed, the Commissioner (Appeals-II) dismissed their appeal.

The main issue before the CESTAT was whether the classification of “Extraneal Peritoneal Dialysis Solution with 7.5% Icodestrin” is correctly classifiable under CTH 9018. CESTAT took into consideration the decision of the Apex Court in the appellant’s own case where it was held that the classification of C.A.P.D. was settled. The considerations of Commissioner (Appeals) had also been noted before arriving at the decision to classify the goods under CTH 9018.

The appellant contended that the classification of goods in question is no more res integra and therefore, deserves to be set aside. The bench of Vasa Seshagiri Rao (Technical Member) and P. Dinesha (Judicial Member) held that the contention needed to be appreciated and the appeal was accordingly allowed.

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