H-D MOTOR COMPANY INDIA PRIVATE LIMITED Vs. COMMISSIONER OF CUSTOMS, INLAND CONTAINER DEPOT,
LAWS(AR)-2010-7-4
AUTHORITY FOR ADVANCE RULINGS
Decided on July 27,2010

Appellant
VERSUS
Respondents

JUDGEMENT

J.K.Batra, J. - (1.) M /s H -D Motor Company India Private Limited, the applicant, is a wholly owned subsidiary of Harley -Davidson Singapore Pte. Ltd. The applicant proposes to import parts / components of motorcycles from Harley -Davidson Group of Companies and their vendors located in different countries for assembly of Harley -Davidson brand of motorcycles in India. The said parts are proposed to be packed into motorcycle kits. In general all the parts, components and sub assemblies required to build a standard order quantity of motorcycles would be shipped together. The vehicles would be assembled in India by fastening the various components together in a predefined sequence of operations. The operators will use a combination of hand tools (wrenches, sockets, screw drivers, etc.) and power tools (electric or pneumatic wrenches, nut drivers, drills, guns etc.) in assembling the vehicles. No other process such as machining, fabrication, stamping etc is proposed to be undertaken with respect to imported parts and components. Routine quality checks would be performed during the assembly operations and motorcycles would be released for distribution after final vehicle inspection.
(2.) MOTORCYCLES imported by the applicant are claimed to be covered under Custom Tariff sub heading 8711 50 00 of the First Schedule to the Custom Tariff Act, 1975. Further, motorcycles imported as "completely knocked down (CKD) unit" are eligible for a concessional rate of duty of 10% ad valorem under -Customs, dated 1st March, 2002. Based on the aforesaid facts the applicant has sought a ruling on the following question, namely: Whether in the facts and circumstances of the present case, the import of motorcycle in the form of components, parts and sub -assemblies, proposed to be imported by the applicant, would constitute import of motorcycles in Completely Knocked Down form and as such would be eligible for concessional rate of basic customs duty at the rate of 10% provided under Entry 345 of , dated 1st March 2002(as amended)?
(3.) THE relevant extracts of Entry No. 345 of Cus dated Ist March, 2002 (as amended) are as follows: S.No. Heading No. Description Rate of Duty 345 8711 Motorcycles (including mopeds) and cycles fitted with an auxiliary motor, with or without side cars, and side cars, new, which have not been registered anywhere prior to importation, - (1) if imported as completely 10% knocked down(CKD)unit (2) if imported in any other form 60%;


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