COMMISSIONER OF CUSTOMS (IMPORT) v. M/S WELKIN FOODS
Customs Classification: Aluminium Shelves for Mushroom Cultivation Classified as Aluminium Structures, Not Parts of Agricultural Machinery; Importance of Sequential GRI Application.
Court: Supreme Court of India
Citation: 2026 INSC 19
Decision Date: 06-01-2026
List of Laws
Customs Act, 1962; Customs Tariff Act, 1975; General Rules of Interpretation (GRI); Harmonised System Nomenclature (HSN); Common Parlance Test; Section Notes; Chapter Notes; Eo-nomine tariff entry
- Facts: M/s Welkin Foods imported aluminium shelving, a floor drain, and an automatic watering system for mushroom cultivation, classifying them under Customs Tariff Item (CTI) 84369900, attracting nil duty. The Commissioner of Customs (Import) challenged this, arguing the aluminium shelving should be classified under CTI 76109010 as aluminium structures, attracting a 10% basic customs duty, 12.5% countervailing duty, 3% customs cess, and 4% additional customs duty. The Audit Scrutiny revealed that the aluminium shelving was a type of aluminium structure and not a 'part' of any agricultural machinery.
- Procedural Posture: The Commissioner of Customs (Import) appealed to the Supreme Court against the Customs, Excise and Service Tax Appellate Tribunal (CESTAT)'s order, which had allowed M/s Welkin Foods' appeal, classifying the aluminium shelves as 'parts' of agricultural machinery. The CESTAT had disagreed with the Joint Commissioner of Customs and the Commissioner of Customs (Appeals), who had both classified the goods as aluminium structures.
- Issue: Should the imported aluminium shelves be classified as 'parts' of machines or mechanical appliances under Chapter 84 (CTI 84369900), or as aluminium structures under Chapter 76 (CTI 76109010) of the Customs Tariff Act, 1975?
- Holding: The Supreme Court held that the aluminium shelves are to be classified as Aluminium Structures under CTI 76109010. The appeal of the Commissioner of Customs (Import) was allowed, and the CESTAT's order was set aside.
- Reasoning: The Court reasoned that Chapter Heading 7610 is an eo-nomine provision for aluminium structures, requiring the goods to be made of aluminium and be a structure or part thereof. The Court found that the aluminium shelves met these criteria. The Court emphasized that Section Note 1(f) to Section XV and the Explanatory Note to Chapter Heading 7610 exclude goods classifiable under Section XVI (which includes Chapter 84) from being classified under Section XV. The Court rejected the argument that the shelves were 'parts' of agricultural machinery under Chapter Heading 8436, finding that the mushroom growing apparatus was not a single machine or a functional unit, and the shelves merely provided a surface for other machines. The Court also found that the CESTAT erred in relying on trade parlance and the 'no other purpose' argument without sufficient evidence and without properly applying the General Rules of Interpretation (GRIs) sequentially.
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