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ISLAMABAD: The customs classification committee of the Federal Board of Revenue (FBR) has imposed 20 percent customs duty on the import of a “steam-fired absorption chiller”, rejecting the importer’s claim of zero percent duty.

In this regard, the customs classification committee has issued a ruling to resolve the dispute between the customs department and the importer. According to the committee’s decision, Committee is of the view that the imported ‘steam fired absorption chiller’, is classifiable under Pakistan Customs Tariff (PCT) heading 8418.6990. The importer has claimed zero percent duty on the import of the said product.

The Collectorate of Customs Appraisement Port Muhammad Bin Qasim has forwarded a reference for classification of ‘steam fired absorption chiller’ under specific PCT Code 8418.6990 or as partial shipment and a part of Plant under PCT 8477.8000, being part of 300TPD Bottle and Film Grade PET Scan Line Plant.

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Brief facts as reported by the referring Collectorate are that importer M/s Ismail Resin (Private) Limited, Karachi imported ‘steam fired absorption chiller’ as partial shipment of 300 TPD Bottle and Film Grade PET Scan Line Plant for release thereof under PCT heading 8477.8000, which covers machinery for working rubber or plastics or for the manufacture of products from these materials. However, referring Collectorate was of the view that the imported goods (absorption chiller), being refrigerating equipment, is appropriately classifiable under PCT heading 8418.6990, which is meant for ‘refrigerating or freezing equipments’.

The representative of the importer explained the working of the Chiller and contended that the imported impugned goods would function in conjunction with other machineries to manufacturer end products (resin); hence, should be treated as integral part of ‘Plant for manufacturing of resins’ and classified under heading 8477.8000.

On the other hand, the representative of Collectorate of Port Muhammad Bin Qasim asserted the imported ‘steam fired absorption chiller’ has separately defined function of production of chilling water as its end product which can be used for multiple purposes and is not restricted to be used specifically for the manufacturing of “Resin” as its end product. Therefore, the imported boiler having individual function is specifically classifiable under PCT heading 8418.6990.

Needless to mention that during the meeting, the representative of Port QasimCollectorate confirmed that the subject chiller is imported in complete assembled form and this position has not been rebutted by the importer’s representative, committee observed. Foregoing in view, Committee is of the view that the imported ‘steam fired absorption chiller, Model XZ0.01-233 D (33/43) 112 (66 IRT)’ is classifiable under PCT heading 8418.6990, customs classification committee added.

Copyright Business Recorder, 2023

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Aamir Latif Jan 10, 2023 08:20am
Customs interpretation is wrong, if a refrigerant equipment is part of process plant, it should be treated as such. There are many technical application of refrigeration systems in hydrocarbon processing and other industries... Chiller is not being used as stand alone refrigeration or air-conditioning purpose. Importer should not surrender but fight. Customs should have better technical understanding of machinery applications
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