GOQii Fitness Bands Not Pedometers But Data Communication Devices: CESTAT Mumbai Partly Allows Revenue Appeal

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai has ruled that GOQii activity trackers and fitness bands are not just simple pedometers, but devices with a range of features including the ability to communicate data. The tribunal partly allowed the Revenue's appeal against GOQii Technologies Pvt. Ltd

The order was passed by a bench of Judicial Member Dr. Suvendu Kumar Pati and Technical Member M.M. Parthiban while deciding a dispute over how these imported devices should be classified for customs duty purposes. The case covered imports made between November 20, 2017 and November 15, 2019.

“The impugned goods are not simple 'pedometer' or activity tracker apparatus and due to its multifarious features offered to the wearer, by way of communication of data/messages, it is more appropriately classifiable as 'other communication apparatus',” the tribunal said.

The department's case was that GOQii had declared the devices as pedometers, attracting a lower rate of duty. It argued that the bands rely on Bluetooth to transmit health data to smartphones and servers, which makes them closer to machines used for receiving and transmitting data.

GOQii, however, maintained that these were primarily health and fitness devices. It pointed to features such as step tracking, heart rate monitoring, oxygen level measurement, sleep tracking, blood pressure monitoring, and ECG screening. Bluetooth, it said, was only used to sync data with the app and was not the main function of the product.

To understand how the devices actually work, the tribunal relied on a technical report from IIT Bombay, which examined several GOQii models. The report found that their core function is to track activity and monitor vital parameters. Bluetooth adds convenience, for instance, by syncing data or enabling access to additional features through the app.

Even so, the tribunal was not persuaded that the devices could be treated as basic pedometers. It pointed out that they do far more than count steps. They track and communicate data, including through connected applications and coaching systems. The tribunal also noted that the products are registered with BIS as “smart watches”.

Taking a broader view of what these devices do in practice, the tribunal concluded that they cannot be reduced to simple counting instruments.

Accordingly, the tribunal upheld the Revenue's stand on classification and set aside the order that had dropped proceedings against GOQii. The appeal was allowed in part.

For Appellant: Ram Kumar, Authorized Representative 

For Respondent: Advocates Gopal Mundhra and Samiksha Chatur,