Madrasdated High Court · 2025

W.P.Nos. 28151 of 2024 & 28118 of 20253.Assistant Commissioner (ST)Thirumazhisai Assessment Circle,4/109, Chennai Bangalore Road,Varadharajapuram, Chennai – 600 123. 4.State Tax Officer,Group – VIII, Inspection – II,Integrated Commercial Taxes Building,Greams Road, Chennai – 600 006.... RespondentsPrayer: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari, calling for the records relating to the Impugned Order bearing Reference No.GSTIN No.33AAZCS3504R1ZK/2021-22 dated 21.06.2024 passed by the 1st respondent and quash the same. For Petitioner:Mr. Vijay NarayanSenior CounselFor Mr. Raghavan Ramabadran For Respondents: Mr. C.Harsharaj Additional Government PleaderW.P.Nos. 28118 of 2025:Mobase Electronics India Private Limited,Represented by its Authorised Signatory,Mr.Yang Soo Tak,____________Page No. 2 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025No.136, Arakonam Road,Thodukadu Village,Sriperumbudur, Tamil Nadu – 602 105.... Petitioner Vs.1.Assistant Commissioner (ST),Sriperumbudur Assessment Circle,4/109, Chennai Bangalore Road,Varadharjapuram, Chennai – 600 123.2.Deputy Commercial Tax Officer (ST)Sriperumbudur Assessment Circle,4/109, Chennai Bangalore Road,Varadharajapuram, Chennai – 600 123.... RespondentsPrayer: Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari, calling for the records relating to the Impugned Assessment Order bearing Reference No.GSTIN No.33AAZCS3504R1ZK/2020-21 dated 25.04.2025 passed by the 1st respondent and quash the same. For Petitioner:Mr. Vijay NarayanSenior CounselFor Mr. Raghavan Ramabadran For Respondents: Mr. C.Harsharaj Additional Government Pleader____________Page No. 3 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025ORDERHeard the learned Senior Counsel for the petitioner and the learned for the respondent. 2.In these Writ Petitions the petitioner has challenged the respective impugned orders dated 25.04.2025 and 21.06.2024 passed for the assessment years 2020 – 2021, 2021 – 2022. The impugned orders have been passed after a detailed show cause notice were issued to the petitioner under Section 74 of the Tamil Nadu Goods and Service Tax Act, 2017, on 20.07.2023, for the respective tax period. 3.It is noticed that earlier an order came to be passed on 04.04.2024 for the tax period 2020 – 2021. The said order was subject matter of challenge in this Court in WP.No.16981 of 2024. The principle issue in the said order was whether the lock and key manufactured by the petitioner and supplied to Automobile Companies (Car Manufacturers) were to be classified under tariff item 8301 (8301 ____________Page No. 4 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 202520 00) as Locks of a kind used for motor vehicles or under 8708 (8708 99 00) as “others”. 4. The petitioner had adopted the classification of the lock and key manufactured and supplied by the petitioner to Automobile manufactures under 8301 (8301 20 00) by paying tax at 18% GST in terms of the notification issued by the Government. On the other hand, it was the contention of the department that the lock and key manufactured and supplied by the petitioner was classifiable under 8708 ( 8708 99 00). 5. This Court had entertained WP.No.16981 of 2024 and had quashed the order dated 04.04.2024 passed for the tax period 2020 – 2021 and remitted the case back, with certain directions specifically in paragraph Nos.10 to 13. The Court had noted that the contention of the petitioner that lock and key manufactured and supplied by the petitioner merits classification under heading 8301 (8301 20 00) and was to be examined in terms of Rule 3 (a) and 3 (b) of the General Rules of ____________Page No. 5 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025Interpretation, as made applicable for classification of the goods under the respective GST enactment. Relevant portion of the said order dated 04.04.2024, was also extracted in paragraph No.10 by the Court in its order dated 09.07.2024. It reads as under: “In order to classify impugned goods under this chapter they must satisfy the chapter notes miscellaneous articles of base metal – Here both the car lock set and car smart key made of combination of both metal and plastics therefore, impugned goods do not merit classification under this chapter 83.” 6. Almost an identical conclusion has been arrived in the impugned order dated 25.04.2025, passed for the Assessment Year 2020 – 2021, without reference to Rule 3 (a) or Rule 3 (b) of the General Rules of Interpretation. Relevant portion of the impugned order dated 25.04.2025, is extracted hereunder:“In order to classify impugned goods under this chapter they must satisfy the chapter notes miscellaneous articles of base metal – Here both the car lock set and car smart key made of combination of both metal and ____________Page No. 6 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025plastics therefore, impugned goods do not merit classification under this chapter 83.”7. The learned counsel for the respondent would submit that even though there is no specific reference to Rule 3 (a) and 3 (b) of the General Rules of Interpretation, the I Schedule of the Customs Tarrif Act, 1975, as made applicable to the respective GST enactments has been discussed. It is submitted that the impugned order is detailed and indirectly refers to the same and that the product under consideration will not come within the purview of 83 01.8. A cursory reading of the impugned order indicates that there is no discussion as to why Rule 3 (a) or Rule 3 (b) of the General Rules of Interpretation, was neither tested nor applied while determining the correct classification, pursuant to order dated 09.07.2024 of this Court in the above Writ Petition. ____________Page No. 7 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 20259. In the impugned order dated 21.06.2024, passed for the assessment year 2021 – 2022 also there is no specific discussion regarding applicability / non-applicability of Rules of Interpretation specifically to Rule 3 (a) and 3 (b), even though the specific case of the petitioner is that if Rule 3 (a) was applied the petitioner's classification under 8301 (8301 20 00) as Locks of a kind used for motor vehicles will merit consideration. Therefore, the impugned order is liable to be set aside to that extent. 10. In the notice that preceeded the impugned orders also there was no allegation to the effect that the petitioner was not entitled to input tax credit in respect of the canteen expenses. It is noticed that only in the impugned order for the first time these issues have been discussed. Thus, there was no opportunity given for the petitioner to answer to the same. ____________Page No. 8 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 202511. The other issues regarding classification of power window switches, wheel remote switches, multi-function switches, wireless power charger, are concerned the petitioner had adopted classification under 8536 – Electrical Apparatus For Switching, 8542 – Electronic Integrated Circuits, 8504 – Electrical Transformers / Static Converters, attracting 18% tax. The department however classified the same under heading 8708 attracting tax at 28%. 12. The discussion in the impugned order reads as under:“The impugned goods (Electrical Switch System) not satisfying the description of goods (CTH 8542 of CTA):The Electrical Switch system is specially designed and assigned with a number as part of specific cars.On the verification of tax payers reply, the taxpayer has classified their product i.e., Electrical Switch system for car under HSN 8542. As per HSN the description of this chapter heading under First schedule of custom tariff act is reproduced as under.____________Page No. 9 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025Section – XVIChapter 85Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles Tariff itemDescription8542Electronic Integrated Circuits85423100Processors and controllers, whether or not combined with memories, converters, logic circuits, amplifiers, clock and timing circuits, or other circuits85423900OtherIn order to classify impugned goods under this chapter they must satisfy the chapter notes Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles – Here the part classified is specially designed for car not for sound recorders and reproducers, television image and sound recorders and reproducers therefore, impugned goods do not merit classification under this chapter 85.In terms of Note 2 to Section XVII, the expression 'parts' and accessories do not apply to certain articles, ____________Page No. 10 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025whether or not they are identifiable as for the goods of this section. In the exclusion, list the item of Chapter 85 can only be excluded, if it satisfies to the following.(b)parts of general use, as defined in Note 2 to Section XV, of base metal (Section XV), or similar goods of plastics (Chapter 39);(f)Electrical machinery or equipment (Chapter 85)With regards to exclusion list (b) the item 'Electrical switch system' is specially designed for specific cars which cannot be qualified as part of general use of base metal or plastic. The Electrical switch system are specially designed for use in motor vehicle, which cannot be used elsewhere and the same do qualify as parts of motor vehicles and liable for classification under CTH 8708, in as much as the same do not remain as part of general use.In order to classify impugned goods under this function as stated in the description the impugned goods are not “electrically operated”, whereas they are basically “electronically operated”.Further, the Collins English Dictionary defines an electrical equipment as,Electrical goods, equipment's or appliances work by ____________Page No. 11 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025means of electricity.Considering the above facts here the electrical switches are not considered as electrical equipment the primary role of it is, it will open or close the circuit, whereas the fuse, relay, circuit breaker are which used to transfer the voltage to the power windows are the electrical equipment's.Further, the effect of Note-3 of Section XVII is that when a part or accessory can fall in one or more other section, its final classification is determined by its principal use.The component manufactured by the Tax payer have been specifically designed and once these are not capable to be used for any other purpose except for use in the manufacture of motor vehicles of chapter 87 of the customs tariff, these parts / accessories / components do not quality to assign as parts of general use.There are two aspects in this regard to understand the nature of general use. One aspect is that where the parts / accessories / components of the motor vehicle are of general use and are available in the open market as general items i.e., are also used by the manufacturer of motor vehicle and still as parts / accessories / components ____________Page No. 12 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025are also used by the manufacturer of motor vehicle and still they are capable of being used for any other purpose. Another aspect is that were the parts / accessories / components of the motor vehicle are specially designed to be used in specific model of the motor vehicle and the same is commercially known as parts of the specific motor vehicle and the same cannot be used elsewhere.In respect of Tvl. Mobase India Private Limited, the electrical switch system and are for solely and principally to be used in the motor vehicles of specific OEM's Car only and the same cannot be used elsewhere except in the motor vehicle and also not in other OEM's car.Hence, the supply of power switch system, Electrical Control unit, Pad Wireless charger which is exclusively used in cars and supply of same to be the car manufactures (OEM) is to be assessed under the classification of parts and accessories of Motor Vehicles at the rate of 28% tax.13. A reading of the above portion indicates that there is a discussion on the basis on which classification has been imposed on the ____________Page No. 13 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025petitioner and the above mentioned heading. Therefore, to this extent challenge to the impugned order has to fail. 14. Therefore, the petitioner is given a liberty to challenge the impugned order dated 21.06.2024, within a period of 30 days from the date of receipt of a copy of this order in so far as classification of power window switches, wheel remote switches, multi-function switches, wireless power charger are concerned. 15. Since the impugned order has not quantified the amount due in respect of classification of power window switches, wheel remote switches, multi-function switches, wireless power charger, the respondents are directed to issue corrigendum to the impugned order in so far as the above three items by quantifying the amount due on these items so that the petitioner can make necessary pre-deposit for filing an appeal. This exercise shall be completed within a period of 30 days from the date of receipt of a copy of this order. ____________Page No. 14 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 202516. The petitioner shall thereafter file an appeal within a period of 30 days thereafter.17. In view of the above discussion, the impugned order dated 21.06.2024, in so far as classification of lock and key supplied to car manufacturers by the petitioner and the issue relating to availability of tax credit on canteen expenses are set aside and remitted back to the 1st respondent for fresh consideration.18. The writ petitions are disposed of. Consequently, the connected miscellaneous petitions are closed. No costs. 23.10.2025Neutral Citation : Yes / Nokan____________Page No. 15 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025To:1.Assistant Commissioner (ST),Sriperumbudur Assessment Circle,4/109, Chennai Bangalore Road,Varadharjapuram, Chennai – 600 123.2.Commercial Tax Officer (ST)Sriperumbudur Assessment Circle,4/109, Chennai Bangalore Road,Varadharajapuram, Chennai – 600 123.3.Assistant Commissioner (ST)Thirumazhisai Assessment Circle,4/109, Chennai Bangalore Road,Varadharajapuram, Chennai – 600 123. 4.State Tax Officer,Group – VIII, Inspection – II,Integrated Commercial Taxes Building,Greams Road, Chennai – 600 006.____________Page No. 16 of 17 https://www.mhc.tn.gov.in/judis W.P.Nos. 28151 of 2024 & 28118 of 2025C.SARAVANAN, J.kanW.P.Nos. 28151 of 2024 & 28118 of 2025 23.10.2025____________Page No. 17 of 17