The Advance Ruling Authority (AAR), Karnataka has held that the power bank supplied by the Xiaomi Technology India Private Ltd, is classifiable as an accumulator and not as static converter under GST.
The Applicant, a leading mobile Company in India, sought for a clarification as to Whether the “Power Bank”, traded by them is classifiable under Heading as Static Converter Others’?
The department contended that the ‘power bank’ is primarily used to charge the battery of the mobile phone and is different from the accumulator.
The AAR noted that the principal function of the instant product is to store the electricity in the battery of the said product and to supply the same when required. Hence it is pertinent to mention here that the battery/ Power Bank is the main / core part of the device and without the battery/ Power Bank it would not function.
“It is thus in the nature of an accumulator and is classifiable under Chapter Heading 5507,” the order said.
The AAR analyzed the explanatory notes of the Harmonized Commodity Description and Coding system and held that “it is clearly evident from the above explanatory note that accumulators are covered under heading 3597 whether or not they include any ancillary components which contribute to their function of storing and supplying e1ectric energy. Further, the accumulators are classified under the heading 8501 even if they are designed for use with a specific device. Therefore., even though the battery in the said Power Bank is attached to the Ancillary circuitry of “Voltage Booster System” for effective function of the said factory, the principal function or the said Power Bank remains the same, i.e, storing and supplying of electric energy and hence the said product merits classification of the heading 85.07, as an accumulator.
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