Custom, Excise & Service Tax Tribunal
M/S Syndicate Labels vs Cc (I&G), New Delhi on 21 September, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
West Block No. 2, R.K. Puram, New Delhi 110 066.
Date of Hearing: 1.9.2016
Date of Pronouncement: 21.9.2016
Appeal No. C/41/2011-CU.(DB)
(Arising out of Order-in-Appeal No. C(A)Cus/I&G/239/2010 dated 20.10.2010 passed by the Commissioner of Customs (I&G), New Delhi)
M/s Syndicate Labels Appellant
Vs.
CC (I&G), New Delhi Respondent
Appearance Shri Nandan Singh, G.M. - for the appellant Shri S.K. Sheoran, D.R. - for the respondent CORAM: Honble Mr. S.K. Mohanty, Member (Judicial) Honble Mr. Ashok K. Arya, Member (Technical) Final Order No. 53667/2016 Per Ashok K. Arya :
1. Both sides have been heard.
2. The matter concerns with the classification of the item viz. HELIOS 11 SYS, 330MM WEB WIDTH 4K B AND W LCD CAMERA A SINGLE 17INCH FLAT TFT MONITOR INSTALLATION AND TRAINING.
3. The appellant viz. M/s Syndicate Labels has been represented by ld. G.M., Shri Nandan Singh and Revenue has been represented by ld. AR Shri S.K. Sheoran.
4. Shri Singh for the appellant pleads that the subject item deserves classification under Chapter Heading 84714190 and inter alia submits as follows :-
(i) The subject item is an independent complete device which automatically inspect, count, process, stores and displaying the data with the help of in-built software with monitor and camera;
(ii) It has in built data processing unit which does all sort of arithmetic and logical calculation and stores the data;
(iii) It is freely programmable in accordance with requirement and does all sort of arithmetic computation;
(iv) This device neither incorporating nor working in conjunction with an automatic data processing machine;
(v) It executes and processes the programmed without human intervention by logical decision during the process run.
4.1 Further he submits that the item imported is entirely different from the items under Chapter Heading 90.
5. The ld. AR Shri S.K. Sheron on behalf of Revenue has reiterated the findings of the lower authorities. He inter alia mainly submits as under :
(i) Note 5(E) to Explanatory Notes to Chapter 84 reads as under:
Machines performing a specific function other than data processing and incorporation or working in conjunction with an automatic data processing machine are to be classified in the heading appropriate to their respective functions or failing that in residual heading. This would be applicable for the classification of the present goods.
(ii) The goods under import designed to provide inspection solution qualify as machines performing a specific function other than data processing and incorporation or working in conjunction with an automatic data processing machine are to be classified in the heading appropriate to their respective functions or failing that in residual heading, therefore, their classification is correctly possible under Rule 1 of General Rules of Interpretation and classification has to be decided in terms of Rule 1 red with chapter note 5(E) of chapter 84.
(iii) The item in question is more appropriately classifiable under CTH 90318000.
6. We have carefully considered the facts of the case along with the submissions of both sides.
7. The appellant is arguing for classification of the item under Chapter Heading 847190. The Revenue is arguing for classification of the subject item under Chapter 90318000. It will be right to reproduce below the description given under these chapter headings:
90318000 9031 Measuring or checking instruments, appliances and machines, not specified or included elsewhere in this chapter; profile projectors. 9031 10 00 Machines for balancing mechanical parts.
9031 20 00 Test benches.......
Other optical instruments and appliances:
9031 41 00 For inspecting semiconductor wafers, or devices or for inspecting photomasks or reticles used in manufacturing semiconductor devices.
9031 49 00 Other 9031 80 00 Other instruments, appliances and machines 84714190 8471 Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data on to data media in coded form and machines for processing such data, not elsewhere specified or included 8471 30 Portable automatic data processing machines, weighing not more than 10 kg., consisting of at least a central processing unit, a keyboard and a display. 8471 30 10 Personal computer. 8471 30 90 Other Other automatic data processing machines:- 8471 41 Comprising in the same housing at least a central processing unit and an input and output unit, whether or not combined: 8471 41 10 Micro Computer 8471 41 20 Large or main frame computer 8471 41 90 Other.
7.1 We have reproduced above the descriptions of the chapter headings 8471 and further sub headings upto 84714190, (whereunder the appellant classifies the product and of the Chapter Heading 9031 and further sub headings up to 90318000, whereunder the Revenue prefers the classification of the product.
7.2 Chapter 8471 is covering mainly the following items:
(i) Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data on to data and machines for processing such data, not elsewhere specified.
7.3 Chapter sub heading 847141 covers the goods which are other automatic data processing machines - Comprising in the same housing at least a central processing unit and an input and output unit, whether or not combined; when such goods are in the category of micro computer, the right classification will be 8471 41 10 or if it is in the category of large or main frame computer then right classification will be Chapter 8471 41 20; for other items, not covered in 84714110 or in 84714120 right classification will be, 84714190, where the appellant wants to classify the subject items.
7.4 Chapter Heading 9031 inter alia covers measuring or checking instruments etc., not specified or included elsewhere. When the goods of above description are not covered under chapter sub headings 9031000, 90312000, 90314100, 90314900, it will be covered under Chapter 90318000 as other instruments, appliances and machines. This is the Chapter sub heading 90318000, where Revenue prefers the classification for subject goods.
8. We have gone through the chapter notes and also respective Explanatory Notes to the Chapter Heading 8471. The Explanatory Notes for Chapter heading 8471 specifically says that this Chapter 8471 excludes machines, instruments or apparatus incorporating or working in conjunction with an automatic data processing machine and performing a specific function. Such machines, instruments or apparatus are classified in the headings appropriate to their respective functions or, failing that in residual headings.......
8.1 Explanatory notes to Chapter Heading 9031 inter alia say that Chapter heading 9031 covers measuring or checking, instruments, appliances and machines whether or not optical....
9. From the descriptions of the chapter headings and the observations in Explanatory Notes to HSN for the respective chapter heading mentioned above, it is clear that subject item cannot be covered under chapter heading 8471 and in any of its sub headings. From the description given for the chapter heading 9031, it is clear that checking instruments which are not covered elsewhere are covered here. The Explanatory Note to Chapter 9031 extracted above makes it further clear that measuring or checking instruments, whether or not optical are to be covered under Chapter Heading 9030.
10. In this regard, we agree with the findings and observations made by lower Revenue authorities, who have also referred to General Rules of Interpretations. The appellant has failed to give required substantial reasoning or evidences in favour of the classification under Chapter Heading 84714190 for the subject item. Further Revenue produced a copy of the import data as an evidence that subject item is being classified by Customs at Air Cargo Bombay under Chapter 90318000, where the goods were imported from Israel and the date of clearance/reference has been given as 5th Jan. 2016.
11. In the light of discussions and analyses made above, we agree with the findings of the impugned order and hold that the subject item deserves classification under Chapter Heading 90318000 of Customs Tariff. Consequently, impugned order sustains and the appeal is hereby dismissed.
(Pronounced in Court on 21.9.2016) (S.K. Mohanty) Member (Judicial) (Ashok K. Arya) Member (Technical) RM 1