Government of Pakistan
Model Customs Collector of Appraisement
Custom House, Karachi
No.CC-12/2007(A) Dated: 09-09-2011
PUBLIC NOTICE NO. 09/2011(A)
SUB: CLASSIFICATION OF FREQUENCY CONVERTER.
In order to determine the proper classification of frequency converter, the case was forwarded to classification committee by MCC Port Qasim. The dispute regarding the classification of subject goods emerged because of the observation of CRA Audit that the goods i.e. frequency converter fall under PCT Heading 8502.400 as against the declared / assessed PCT heading 8504.4090. The meeting of the Classification Committee was held on 22.08.2011. The following PCT Heading were considered:
1) 8502.4000
2) 9032.0000
3) 8504.4090
2. In CRA’s observation it was pointed out that the correct PCT is 8502.4000 instead of PCT heading 8504 which only covers electrical static converters. The documents/literature provided by the party also provided that the goods were static converter. The manufacturer’s letter dated 18.05.2005 certified the goods in dispute are static converters. The feature of Electric rotary converters have been elaborated, in the Explanatory Notes to Chapter 8502 in following terms;
“These consist essentially of a combination of an electric generator and prime mover consisting of an electric motor permanently mounted on a common base, through in certain cases the two functions are combined in one unit with certain windings in common. They are used to transform the nature of the current (to convert from AC to DC or vice versa) or to change certain characteristics such as the voltage, frequency or phase of alternating current (to convert, for example, the frequency of 50 to 200 cycles or to transform single phase to three phase current.) Another type of rotary converter (sometimes known as a rotary transformer) is used to convert DC from one voltage to another”. Whereas Electrical Static Converter has been defined in the Chapter note to PCT heading 8505 as “The apparatus of this group are used to convert electrical energy in order to adapt if for further use. They incorporate converting elements (e.g., valves) of different types. They may also incorporate various auxiliary elements (e.g., transformers, indication coils, resistors, command regulators, etc.). The operation of such type of machine involves converting elements by alternately interplay of conductors and non conductors.
The fact that these apparatus often incorporate auxiliary circuits to regulate the voltage of the emerging current neither affect their classification in this group, nor does the fact that they are sometimes referred to as voltage current regulators.
This group includes:
A) Rectifiers by which alternating current (single or polyphase) is converted to direct current, generally accompanied by a voltage change.
B) Inverters by which direct current is converted to alternating current.
C) Alternating current converters and cycle converters by which alternating current (single or polyphase) is converted to a different frequency or voltage”.
3. PCT heading 9032 covers instruments and apparatus regulating or controlling instruments which includes instruments or apparatus for automatically controlling the flow, level, pressure or other variables of liquid or gases, or an Electrical phenomenon which varies according to the factor to be automatically controlled, and Automatic regulators of electrical quantities, and instruments or apparatus for automatically controlling non-electrical quantities the operation of which depends on electrical phenomenon varying according to the factor to be controlled. The heading also includes automatic controlled apparatus of liquid or gases and apparatus for automatically controlling temperature which form part of complete automatic control systems and consist essentially of the following devices:
(A) A device for measuring the variable to be controlled (pressure or level in a tank, temperature in a room, etc.); In some cases, a simple device which is sensitive to changes in the variable (metal or bi-metal rod, chamber or bellows containing or expanding liquid, float, etc.) may be used instead of a measuring device.
(B) A control device which compares the measured value with the desired value and actuates the device described in (C) below accordingly.
(C) A starting, stopping or operating device.
4. The item in dispute is not rotary and converts the required frequencies of the alternating current and does not contain all three devices/parameter i.e. measuring, control, operate therefore PCT headings 8502 and 9032 are not relevant. The PCT Committee unanimously concludes the goods under discussion may be classified under PCT heading 8504. Keeping in view clause 1 to 6 General Interpretative Rules of schedule 1 to the Customs Act, 1969, the product in question i.e. static converter is classifiable under PCT heading 8504.4000.
Signed by
(Dr. Zulfiqar Ahmed Malik)
ADC-I/Chairman PCT Committee
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